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2019 was another year fraught with corporate crises on both a national and international scale. With so much going on in our world, and the near-instantaneous news cycle that social media allows, it is easy to become overwhelmed by the sheer amount of organizational change that we saw this year.

While we will be focusing on some of the largest and most impactful business blunders of the past year, our observation doesn’t have to be exclusively negative. As with most downturns, there is something to be learned from these cases so that we can go into 2020 and the following years with confidence in our organization and how we operate. You’ll also see that in some of these disasters that we spotlight, that the leaders not only recover but bounce back stronger than before.

Similar to previous years, the crises we have gathered will be tested against our five key principles outlined in my book, Brand Under Fire: A New Playbook for Crisis Management in the Digital Age, along with some more conventional insights. You will have heard about most if not all of the crises we cover below, but perhaps by changing your perspective and putting yourself in the shoes of the people making the critical decisions, we can understand them in a new way.

We focused on:

    • Capital One Data Breach
    • College Admissions Scandal
    • NBA/China
    • USWNT Equal Pay

Capital One Data Breach

Brand Under Fire Principles: Speed & Agility

Capital One went public in July with news about a recent data breach. This announcement came just hours after an arrest was made on the suspected hacker.

Data breaches are a unique crisis in thousands to millions of people can be affected not only emotionally, but financially. They are not just moral issues that the company has to deal with, there are also direct interests at play. Capital One took the risk of communicating quickly despite having a full picture of the damage. It can be painful to roll out bad news over a long period of time as more information comes into play, but by staying in front of the news cycle, you are able to fill the void of information yourself, rather than have it filled for you.

In an effort to quell concerns of the bad news as it did inevitably roll out, Capital One kept a link at the top of their main website that directed users to a page where they could find the most up to date information on the breach and what Capital One was doing about it.

While it is said that many of the announcements did not come across as particularly genuine or personal, Capital One did respond in a timely matter that most likely saved them further negative headlines.

Takeaway: By being the source of news on your crisis, you fill the vacuum of info and can break the story rather than having it broken for you. By being an up-to-date reliable source, you block the ability of ill-intended organizations to spread false or slandering information.

College Admissions Scandal

Brand Under Fire Principles: Authenticity, Transparency & Agility

The college admissions bribery scandal, also cheekily labeled Operation Varsity Blues, suggested the involvement of CEOs, celebrities, athletic personnel, and top administrators in racketeering and money laundering in an effort to admit under-qualified students into prestigious universities. Not only were these individuals and institutions facing potential legal charges, but they were also thrust into the court of public opinion.

When you are an organization facing this onslaught of disappointment and anger, you must think before you act. After all, you are facing an uphill battle not only with the media but also with potential and current students and faculty. While schools sometimes seek to achieve prestige through hush around internal operations and affairs, the public will not be as patient when there are unanswered questions. Failure to fully outline and explain your plan for remediation can be damaging to your brand in the eyes of prospective students.

One of the standout responses came from UCLA’s Director of Athletics, Dan Guerrero, whereas part of the scandal, a high school senior had been awarded admission and a soccer scholarship without ever having played the sport. The response to this incident did well to address the audience in the first person, making it more personal and sincere as Dan Guerrero shared his detest for the events that had taken place. Although not a flawless release, the statement was a timely example of authenticity coming from the source with a promise to be more accountable as a university. In his own words, “how we do things is just as important as the results we produce.”

Takeaway: It is better to be open and transparent in how you explain what you will do to remediate the damage you have caused rather than try to save face.

NBA/China Scandal

Brand Under Fire Principles: Speed & Agility

One of the most intriguing sports crises of 2019 began with one individual on Twitter, and turned into an entire professional sports league being under fire. In October, Houston Rockets General Manager Daryl Morey sent out a pro-democracy tweet regarding Hong Kong. In response, the Chinese Basketball Association along with other sponsors withdrew partnerships with the NBA.

The primary mistake on the part of the NBA shortly followed. The organization tried to perform a balancing act of maintaining geopolitical ties while supporting the freedoms of their domestic audience. The tweet was called “regrettable.” This did not change the mind of the Chinese influencers, and it sparked even more outrage from U.S. fans.

Two days later, the NBA’s agility allowed them to redirect their course in navigating this crisis. A second statement was released by NBA commissioner Adam Silver, addressing the frustration and inevitably different viewpoints across international borders. He reiterated that the NBA will not regulate what individuals that are part of NBA teams can say on political issues.

While a second attempt at addressing the issue seemed to have positive effects, if the NBA had properly weighed their values against the benefits of multinational business, especially in China, they could have possibly gotten their messaging right the first time. Instead, in this instance, the NBA came out the loser in both battles.

Takeaway: Understand your priorities before going into a crisis, and reevaluate them during one. You can’t always please everyone, and you need to be able to choose a path or you’ll be stuck upsetting everyone involved.

USWNT Equal Pay

Brand Under Fire Principles: Transparency, Speed & Agility

In July of 2019, as the U.S. Women’s National Team was taking final control over the World Cup Final game over the Netherlands, a chant broke out amongst the crowd. Instead of the expected, “U-S-A,” instead the roar of, “EQUAL PAY” reverberated through the stadium.

As part of a years-long battle between the USWNT and U.S. Soccer, a class action lawsuit had been filed in March and signed by a large portion of the team members of the USWNT, alleged that they were consistently paid less than the men’s teams. This was further thrown into the spotlight by the USWNT’s consistent success on an international stage, while the men’s team has recently fallen short in most goals.

U.S. Soccer made a few initial mistakes from a communication perspective. From the beginning, they continually denied blame and argued that the men and women’s teams were separately functioning organizations. Their next highly criticized move included hiring lobbying firms as the legal battle grew. Lastly, U.S. soccer began to argue that the women’s team was actually paid MORE than the men’s team.

By denying, redirecting, and trying to push other narratives, the speed that U.S. Soccer came out with information did not quell the anger of fans and players because it did not feel authentic. In an attempt to be transparent with the numbers, the organization at the same time made little effort to show that the numbers had not been skewed. Overall, the response made the USWNT feel that they should be grateful instead of striving for more equal pay.

As far as the resolution to all of this, it seems that it must be settled in the courtroom.

Takeaway: Facts need context. Even if you believe that the numbers absolve you, you still need to show authenticity in the way that you present information rather than use it as a measure to entirely deflect blame.

Hopefully, these articles made you think about whether or not your organization is ready for something of this scale to occur. The businesses that come out of a crisis strongest are those that are the most equipped before an event ever occurs. The best time to prepare yourself for a disaster is yesterday. Are you ready?