General Motors has been in the headlines recently because of their failure to fix an ignition switch problem from 2004, which has now led to a 2.6 million vehicle recall. What went wrong mechanically and why GM failed to initiate a recall in a timely fashion are questions I cannot answer. However, this situation does provide an opportunity for all businesses to review what is involved in crisis communication and evaluate the strategies they have in place.

All business owners, small or large, need to have a strategy in place for when something goes wrong. No matter how carefully a business is run, a bad supplier, employee, or small mistake will inevitably lead to the need to employ crisis communication. In an ideal situation a response to a crisis is proactive. The company identified areas of weakness ahead of time and created a crisis management plan. By having a plan in place, the communications team can act quickly and minimize damage to the company’s reputation.

There are a few basic elements that crisis communication plans usually have in common.

Determine a crisis communication team
Select a spokesperson
Create a media strategy
Determine potential weaknesses
Be honest! Do not try to keep secrets during a crisis
Evaluate the plan after the crisis and make changes as needed

Now let’s take a closer look at General Motors. If they had conducted the recall after the ignition switch problem was first diagnosed they would have had more control over the release of information. However, the delay in response put the company and CEO Mary Barra in the hot seat.

Since the recall was announced the spotlight has been on GM’s new CEO Mary Barra, who took the reins in January. This past week, during congressional hearings, Barra has proven she is calm and confident under pressure. Barra, who was not made aware of the problem until becoming CEO, admitted that “terrible things happened.” During hearings she made it clear that the new GM is focused on a “customer culture” not a “cost culture.” She was well prepared to address the issue and not get rattled by congress.

After two days of congressional hearings, Barra made several apologies and left the impression that she is trustworthy and cares about the public. However, family members of the victims and the general public were probably left hoping for more concrete answers about compensation, which Ms. Barra is unwilling to provide pending the results of the internal investigation. In the end, Ms. Barra stuck to the facts and did not make any claims that could be called into question later.

In a statement to employees she mentions that the future of GM’s reputation will be determined by “how they respond going forward.” In order to avoid a crisis of this magnitude going forward, GM needs to reflect on what was missing that allowed this situation to happen. Moving forward Barra and GM’s communications strategists need to identify weaknesses and create better external and internal communications strategies.

What do you think? Has Ms. Barra and General Motors handled the situation well?

Until Next Time,
Katie

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