Robert Weinhold, Fallston Group
3 July 2020Executive Appointments

The power of crisis leadership

The importance and value of crisis leadership has perhaps never been more apparent than it has been in 2020. Companies across the globe have been bombarded by one societal crisis after another. Every time a leader delivers a message—be it at a board meeting, media interview, keynote, all-staff meeting, community event, or on a social platform—the reputational piggy bank realises a light deposit or heavy withdrawal.

Within the captive insurance industry, thinking strategically about what the right message is and how it will resonate with many micro, diverse communities will help assure your reputational and cash balances pay incremental dividends over time.

I’ve learned from many leaders who communicate spectacularly under duress. The best communicators are obsessive about every syllable they utter, facial expression, piece of clothing and message point they deliver. They’ve learned how to steer clear of organisational jargon. They are detail-oriented and compassionately deliver messages in a conversational way that quickly and emotionally connects with those who consume their words.

“Much like a sprinter’s start, effective crisis leadership is about getting out of the starting block strongly and saying the right things for the right reasons.”

They are analytical, well-timed and process loads of information, almost instantaneously. They have a steady hand under pressure no matter the gravity of the situation or tightness of deadline. They understand the big picture, it’s what they do best: seeing the whole room and moving people to proper perspective, balance, and action.

Mishandled crises will cost you time, money, stakeholder confidence and your career. The decisions made today will be judged by many for years to come. It is impossible to spin your way through a crisis, instead you must lead the way through it. It’s not about shallow window dressing, it’s about long-term sustainable change.

Real leaders emerge when the chips are down, and the stakes are at their highest. Anyone can lead when profits are high and employees are happy and motivated. After decades of helping people during life’s most difficult times, I’ve come to realise that crises are not to be feared, but rather present opportunities for growth.

Reputation leads to trust and trust leads to valuation, but not all valuation can be measured in dollars.

I’ve had the privilege of advising leaders in large healthcare, academia, financial, legal, entertainment and insurance organisations, along with many public, private, government and nonprofit entities who are fighting for marketplace trust and their futures. The key is to understand each organisation’s navigational fix—where’d they like to be—and then chart the path forward using a deep well of instinct and experience.

Crisis leadership is an art, not a science. It’s laden in nuance—a predictive mindset is not negotiable.

The right balance

I’ve worked with partners in the healthcare space on a myriad of issues, including accusations of patient dumping, criminal activity, gross mismanagement, sexual harassment accusations and medical malpractice claims, to name a few. There is no shortage of issues to contend with in this industry, and many are insured by captives.

In many cases, those filing claims will lay their case out, complete with disparaging facts with only a loose connection to the perceived truth, and with an aggressive demand for settlement. Layered into the claim is often the subtly veiled or overt threat of “going public” if the settlement demands are not met within very short periods of time.

This leaves the healthcare client and its legal/risk teams with a decision to make: should they settle and avoid the court of public opinion or risk reputational damage for the sake of saving dollars and/or doing what the system believes is fair and just?

This is a tricky balance, as the court of public opinion may initially weigh heavily in favour of the plaintiff. Its legal team is often first to market, putting the healthcare organisation on the defensive. To complicate matters, the court of public opinion renders a verdict in hours and days, not months and years.

Captives are seeing more instances of plaintiff attorneys using the media to attract more clients, as well as threats of class action suits if matters are not settled quickly. This can be especially challenging in cases involving allegations of sexual misconduct: how does one protect the reputation of the corporation or institution without completely submitting to the demands of the plaintiffs?

There is no easy answer in such situations. It is important to remember how the corporation or institution handles itself in the media in response to a lawsuit, or threat of one. This will be a factor in determining how that corporation or institution can recover once the event/lawsuit is resolved. It’s imperative to think both short and long-term, understanding that you are setting precedent along the way. It is a time to strategise cognitively, not emotionally.

To manage this dynamic, the forward-thinking legal teams I’ve worked with quickly analyse the treacherous traditional and digital landscape—the who, what, where, when, why and how of storytelling. It is about predicting how a story will land—and be reacted to—on varying media platforms, to the diverse micro-audiences who are influenced.

Concurrently, there is a lot of due diligence under way to ensure all of the facts are known; spokespeople are identified and trained; ambassadors, detractors and influencers are accounted for; media market is sized up and executive alignment is in tow. It is a real-time chess game whereby court filings or press conferences can occur at any moment.

The right people

Some healthcare captives boards put their CEO at the centre of the management of their media response. This is best accomplished by having the chief executive on the captive/risk board, so all the facts, nuances and timelines are clearly understood. Generally, in order to respond nimbly to such legal events, having the right people on the board and the right people supporting the captive is central to a favourable outcome.

If there is a desire to speak publicly about a lawsuit or pending matter before a case is resolved, it is important to make sure the right spokesperson is selected. Should it be a representative of the healthcare institution? If so, what level? Or should it be defence counsel?

Should the spokesperson deal with the print media only, or also broadcast journalists? What about timing? How will the story evolve? What are the plaintiffs and their attorneys saying? Does it matter? The list of considerations goes on and on.

An increasing number of organisations are propelled into crisis by video—generally a sudden, digital event. Several years ago, a US-based healthcare system was suddenly thrust on the international stage when its emergency department (ED) security team was recorded escorting a vulnerable patient from the ED to a nearby bus stop wearing only a hospital gown.

To compound matters, the incident took place at night with the temperature close to freezing. Needless to say, within 24 hours the video elicited global outrage toward an institution that was “supposed to help people” as cries of “patient dumping” grew in the marketplace.

There is no question the situation was mishandled from an operating standpoint—on many levels, and with severe legal implications. Many clients have an internal tug-of-war at this point—do we simply issue a statement and not say anything more in anticipation of the possibility of a trial? Or is it better to get out in front by being open with the media, apologising and taking responsibility, and talking about the organisational steps forward?

It is often the executive leadership who will make that call, at times against the advice of counsel or insurance providers. In this particular case, the chief executive of the hospital stepped-up, apologised and humanised the institution and its response. The hospital’s response was handled brilliantly, in crisis terms, and on television for the world to see. Leadership owned the issue—there was no deflection.

Much like a sprinter’s start, effective crisis leadership is about getting out of the starting block strongly and saying the right things for the right reasons. That said, winning the race comes down to sustaining the intense messaging tempo and making the proper leadership, strategy and operating decisions that drive long-term sustainable change.

The hospital accused of patient dumping, over time, made timely policy and operating adjustments which serve their community well. This is an example of turning short-term adversity into long-term advantage—a patient advantage.

The guidepost must always be to act in the interest of the captive client. Below are a few tips to ensure your reputational piggy bank continues to overflow.

  • Never erode your integrity: misinformation breeds distrust. There can be an immense pressure to “make your organisation look good”. Many want you to press your nose up against the ethical window of truth and transparency. Do not cave in to others who would like you to lie, distort the truth or leave vital facts behind which alter messaging and perception—this is tantamount to a lie. Once it’s lost, you will never fully restore your integrity.
  • Be relevant: as the art of traditional and digital press relations evolves within a changing worldwide media landscape, many leaders seem less inclined to return a reporter’s calls, or otherwise seek to delay the release of information. Some view this as refusing to feed the “media monster”. By sticking their heads in the sand and not responding, businesses make themselves irrelevant and ineffective. If you don’t tell your story, someone else will. When someone else tells your story, it certainly won’t be the story you want told.
  • Know the facts: a common mistake of many who speak publicly revolves around not fully preparing and gaining a sound understanding of the facts before articulating their position. Too many professionals jump out on camera or in front of an audience with no substantive information or an unwillingness to engage with questions. Not knowing the facts or relying on the “no comment” phrase is unacceptable. Know your position, know your craft: it’s your legacy.
  • Be predictive: when preparing to deliver a message, be certain to plan for every question and eventuality. There is often a tendency for people to want to go on camera without fully preparing because they are used to speaking publicly or know the organisation very well—chief executives are good for this. Push back and demand ample preparation. Failing to plan is planning to fail.

An eight to 15-second media soundbite can ruin your career—just ask BP’s former chief executive, Tony Hayward, who recklessly uttered “I want my life back” after one of the world’s most damaging oil spills that killed 11 people in 2010. Don’t wing it; prepare for every interview no matter how mundane or harmless it may seem.

  • Build media relationships: know those who tell your story—media and your ambassadors—as well as your detractors. You want to get the benefit of the doubt when people tell your story. It’s not about an unfair advantage, but simply balance. When managing the media, gather intelligence from reporters and news organisations—ask them what angle they plan to cover, who they are speaking with and what their position is. They are under no obligation to share these details, but you’d be amazed at what they will tell you, particularly if there is an existing relationship or future mutual need.
  • Video doesn’t tell the whole story: a video account of what happened does not factor many variables—what each party said, body language from all angles and what transpired before and after the footage. In today’s digital world, everyone is a citizen journalist with an opinion, and many want to be the next YouTube sensation. More is recorded and shared than at any other point in history. The emergence of video has changed all professions, but be careful when making a judgement or decision based solely on video evidence. Treat video for what it is: another tool in the search for the truth.
  • Practise, practise, practise: it is essential to practise public speaking. Practise on camera in an authentic, safe environment. Reputations on camera can save your career.
  • Seek advice from colleagues. take a look at how others have responded during times of crisis and leverage their lessons learned to your advantage. Your colleagues, peers and competitors are invaluable pools of knowledge and can serve as the single most important case study resource. Be a student of your peer experiences and learn from other’s successes and missteps.

Of the many leaders I’ve worked with during crises, there are two benchmarks of success which allow leaders to quickly maintain control and weather the storm. First, they put their hand in the air and recognise they are in trouble—they don’t let their ego get in the way. Second, they ask for help from their trusted circle.

Recognition of trouble and decisiveness in action will help you turn short-term adversity into long-term advantage.

Robert Weinhold is chief executive officer of the Fallston Group. He can be contacted at: