Dealing with Corporate Chaos – The value of the right strategy

I like structure, order and consistency. I also like chaos. One provides stability, the other a challenge. In the corporate business world, we often see both: longer periods of relative stability and continuity with brief interjections of chaotic episodes that help make the business world a bit more of a challenge, a bit more fun, especially from a communications perspective.

Businesses need to communicate, and there are no shortage of groups within most organizations that can be leveraged, including Public Relations, Analyst Relations, Marketing, Sales, etc. I typically view corporate communications as falling into one of three categories:

  • Corporate-Focused messaging, where the company is focused on corporate stability, overall market direction (and domination) and the ability to be a long-term, reliable brand,
  • Product/Service-Focused messaging, designed to promote the merits and/or value of a particular product or service, and
  • Feel-good messaging, where the company is trying to promote the overall business, or the “brand” – often through a hybrid combination of Corporate and Product/Service messaging, and typically through cause-based efforts (“we’re so committed to this cause, that we’ll donate $$$ for every product you buy…”).

In a period of stability and order, this system works fairly well. In fact, many companies just assume that things will always be quiet and calm and plan their “market influence” strategies accordingly. But things never stay calm, do they.

Chaos has its own unique way of being an extremely efficient disruptor of corporate communications, and can strike from any source. A rogue employee (even in the C-suite). A dysfunctional Board of Directors. A product that didn’t perform quite the way it was designed to, or even a product that has been tampered with or sabotaged.

The list of possible sources of chaos is essentially limitless, as is the type and list of companies that it strikes. Want some good examples? Tylenol, which faced a product tampering crisis, Netflix, and their botched announcement of Qwikster (and its subsequent disappearance), HP, and their ongoing Board of Director’s turf battle, and Bank of America, trying to put a positive spin on a $5/month debit card fee, then backing off, then clarifying (almost like a politician).

When evaluating the strength of an organization or company, I like to look at how they react to these periods of chaos. It shows me several key elements:

  • Have they anticipated probable or likely disruptive events?
  • Do they have contingency plans in place to make sure the right message gets out, to the right audience through the right vehicle?
  • Are they monitoring what their customers are saying about them (in all of the various mediums) and are they tailoring their message accordingly?
  • Do they have the ability to bounce back from a chaotic episode without scars and a damaged reputation?

More importantly, I look for how quickly they can adapt to the crisis at hand, and make sure that the right type of communications (Corporate, Product, Feel-good), or combination thereof, is being used in the right manner that helps diffuse the crisis as quickly as possible.

So the next time you are looking at a company, and trying to determine their real strength in a market, don’t just evaluate their ability to operate in a stable, predictable manner, but look at how they react, and counter, disruptive chaotic events. That’s where the real corporate culture comes out.

  • http://twitter.com/jeffthesensei Jeff Wilson

    Hi Fred,

    First time commenter, long time reader.

    Interesting insights particularly in light of J&J building crisis around their Baby Shampoo. The match that lit the fire in this case was a consumer advocacy group, not unlike what Green Peace did to Nestle a while ago. Now the fire builds with each consumer reaction and social share.

    So far the folks at J&J are defending and denying; a poor strategy should the accusations turn out to be true. Defend and deny is great if its small, but on an issue like this that is so emotionally charged, the chaos/risk grows exponentially to affect not just baby shampoo, but all J&J products, their bottom line and ultimately share price.

    It will be an interesting case live study to watch and ask the same questions you have raised here. I can certainly guarantee their competitors are watching and planning. The savvy ones will be creating their own strategies to take advantage of that weakness creating even more chaos for J&J.

    What are your thoughts on that?

    Jeff – Sensei