Slammed - In a PR crisis, act NOW!

By Jennifer Wang | Entrepreneur Magazine - August 2010

Q: How do I deal with a PR nightmare?

A: There are times when you can get away with burying your head in the sand, but a business crisis isn't one of them. You need to drop everything and fix it. Now.

"Small-business owners think they can put their heads down and outwork everything," says Ronn Torossian, founder of 5W Public Relations, based in New York. "But you can't outwork crisis. For the people it impacts, it will feel like the end of the world."

Torossian has seen major corporations, small businesses and celebrities through a fair number of troubling times (Lil' Kim's perjury case and financial scandals of a Fortune 100 company). By now, he's got a few standard rules for managing crises of any scale.

First, he says, come up with a message that addresses what went wrong and how you'll handle it. Don't wait to apologize.

Then communicate that message to everyone who's been affected--in person, if possible. A newsletter won't cut it, and letting the media provide updates will make matters worse. And don't pass things on through lawyers or spokespeople. Delegating raises the probability of more disaster. Warns Torossian: "It won't keep your employees from all walking out or vendors from suddenly saying, ‘We want immediate payment because we don't know if you're going to be here next month.'"

Work on your delivery, too, because how you say things in public can be more important than what you actually say. (Wrong: Tiger Woods' 13-minute ramble of an apology. Right: Bill Clinton's direct, sincere four-minute apology.) "Americans are very forgiving, but they need to believe you actually care," Torossian says. So leave the script at home and be prepared for scrutiny, because if you're uncomfortable, it will show. Do everything you can to make yourself and your audience more comfortable--grab water, enunciate, avoid jargon and fancy words and be ready for discussion. "Speak compassionately and honestly, and don't pretend to be on a higher level than your audience," he advises. "It's the best way to put people at ease."

In the end, be resigned to some fallout. Not all will be forgiven, but you can minimize the damage. Fortunately, Torossian says, small-business owners can move faster than big companies, and they should take advantage of that.

The Global GE ecomagination Challenge: Win $100,000 for Your Business

The challenge is open to business, technologists, entrepreneurs and start-ups from across the globe. Entries will be evaluated for both a commercial relationship, as well as a $100,000 innovation award.

GE ecomagination Challenge

ecomagination is GE's commitment to invest in a future that creates innovative solutions to environmental challenges and delivers valuable products and services while generating profitable growth for the company - in essence, making "green", green.

One way to participate is through the GE ecomagination Challenge: Powering the Grid, announced on July 13 by GE, leading venture capital firms, as well as Chris Anderson, editor-in-chief of Wired magazine. The challenge is an open call for breakthrough ideas and technologies that will help create a smarter, cleaner, more efficient and economically viable grid, and to accelerate the adoption of smart grid technologies. Collectively, GE and its venture capital partners have committed $200 million to help bring these new ideas to market.

The challenge, which runs through September 30, is open to business, technologists, entrepreneurs, start-ups, students and groups from across the globe. It's open to anyone aged 18 years or older and all legally formed entities. Read all the details here and submit your ideas at http://challenge.ecomagination.com/ideas

There are three categories for submission:

* Challenge 1: Create Power - Renewables
* Challenge 2: Connect Power - Grid Efficiency
* Challenge 3: Use Power - Eco Homes/ Eco Buildings

The challenge is open now at http://www.ecomagination.com/challenge, and you can read the full press release here. Get your family and friends involved - members of the general public will be able to view streaming video of the entrants presenting their ideas and vote for the idea that they believe will have the most impact on the smart grid of the future.

Join the conversation on Twitter too at @ecomagination.

* Use the #ecochallenge hashtag to talk about the challenge specifically
* Use the #ecomagination hashtag to talk about all ecomagination topics

By using these hashtags GE and its partners hope to connect the discussion between your Group and the larger ecomagination community.

The opportunity to change the world is in your hands, so join the challenge, submit your ideas, vote for the most promising teams and help change the way the world uses energy in powerful new ways.

The Power of Positive Failure

by David Simms

Positive failure: Isn't this an oxymoron? What good can come from failing? The answer, it seems, is "a lot."

I recently moderated a panel of nonprofit leaders titled, "So You Want To Be a Nonprofit Executive?" At one point, I asked each panelist to share a failure from which they had learned a valuable lesson. Believe it or not, they did so eagerly.

Steve Pratt, the CEO of My Turn, jumped right in and shared a great example of accepting a CEO job that, in retrospect, could have been done only by Superman. "There were too many stakeholders with competing agendas and different definitions of success," he said. "I convinced myself that my track record had given me superpowers that could overcome the fundamentals of effective strategy — no consensus means no strategy."

Ben Mahnke, the CFO of Facing History and Ourselves, described a situation in which his tendency to advocate strongly for his favored solution to a problem excluded others (and their ideas) from the debate. It once led him to "win the battle but lose the war." He said he placed too much emphasis on getting a particular course of action launched; the resulting program didn't have the necessary buy-in from his colleagues.

Panelist Amanda Fernandez, the vice president for diversity and inclusiveness at Teach for America, said she joined an organization early in her career without first assessing its culture and whether it fit her values — only to discover too late that it didn't.

Bridgespan's own Karen DeMay recalled working on a critical board search. Karen had a senior-level contact who had a relationship with a CEO that her client had targeted as a good candidate for board chair. When the contact offered to help with the search, Karen agreed, assuming that he would simply discuss her client organization and tee up an introduction. However, instead of connecting the two parties, the contact directly asked the CEO if he would be the organization's board chair. The CEO declined without ever learning about the client organization. Karen had failed to confirm with her contact how she wanted him to approach the CEO and the strategy she was taking for teeing up conversations with her client. As a result, the client lost out.

The panelists' experiences provided valuable insights for the audience of potential nonprofit leaders. But failures are often a taboo topic. When was the last time you talked about one of yours, even in private? Most nonprofits don't discuss individual or program failures, perhaps because they fear a loss of funding. Few foundations admit to supporting programs that don't work out, but we know there are thousands of grants made that don't achieve their desired results.

When we avoid discussing failures, we deprive both ourselves and our colleagues of the lessons we've learned from them. In Steve's and Amanda's cases, they learned important lessons about what to look for in a job. Steve had been too sure of himself and his ability to make things right when the structure of the job, viewed through any objective assessment, was clearly set up for failure. Amanda vetted culture and organizational values very carefully at Teach for America with CEO Wendy Kopp before accepting the new position. Ben learned the hard way the importance of building relationship capital and not always "being right." And Karen learned not to make assumptions about relationships when critical outcomes are at stake.

I didn't offer my own examples for the panel, but I could have shared the painful consequences of hiring a senior salesperson without first doing reference checks. He was essential to our revenue plan, but it turned out he couldn't close a sale! We also once added someone to a nonprofit board who had a stellar CV but little commitment to the cause. He ended up making no discernible impact on the nonprofit before leaving three years later, all the while occupying a valuable board seat and depriving the organization of the ideas and actions a more-engaged person might have brought to the table.

Whatever the consequences, the painful lessons you've learned, if shared appropriately, can certainly benefit someone else. I'm challenging myself — and you — to be willing to share those stories that have less than happy endings. We can help others, and maybe even learn something more about ourselves in the process.

So what about you? What have you learned from failure? Does your organization tolerate failure? Does the culture allow you to share lessons openly?

David Simms is a partner at The Bridgespan Group. He leads the firm's Leadership and Careers initiative.