By: Michael McQueen
Following the recent Senate enquiry, now ex-CEO of Optus Kelly Bayer Rosmarin resigned with a name now tied to two of the biggest tele-communications crises of the last few years – last year’s data breach and the recent network outage.
While crises will inevitably occur, they do not need to come at the cost of credibility. However, so many leaders and companies fail to exhibit the qualities that the public expects during a crisis, and because of this they forfeit the trust that undeniably equates to currency in today’s sceptical marketplace. This most recent network outage crisis offers leaders and organisations some lessons on precisely this front.
At an immediate level, the communication during the outage was simply not strong enough – particularly for a communications company. Even Prime Minister Anthony Albanese when being interviewed on Sky News pointed to the fact that Michelle Rowland was “out there giving more information, frankly, than Optus were giving out there to customers.”
Good Communication is Crucial
In today’s age of information and scepticism, bad communication is a death sentence. Not only does a lack of honest, real-time information invalidate any respect a company has for its customer, but it instantly erodes trust. While PR departments opt for polished statements in response to crisis, the traits that really release the “trust hormone” of oxytocin in human beings are openness, vulnerability – and even fallibility. Admissions of weakness, while uncomfortable, are far better at building, maintaining and restoring trust than a pretence of infallibility ever will be.
This is true across industries. In fact, research by social psychologist Kip Williams found that jurors were more likely to view an attorney and their case more favourably if the attorney revealed weaknesses in their case before the opposition had the chance to do so. In doing this, the attorney established a perception of honesty. Verdicts were statistically more likely to be given in favour of the party first to bring up the issue. In the same way, corporate mistakes are more likely to be forgiven if they are committed by a company that is trusted for its integrity and candour.
Beyond the psychology of it, a lack of communication signals that a company or individual does, in fact, have something to hide. And in these cases, today’s public will be quick to fill in the blanks. Particularly within a corporate crisis, companies need to ensure that they leave no space for the “narrative gap.”
Without an Explanation, Companies Can Become Villains
When people don’t have clear explanations, they create their own narratives – and the corporate behemoth that let them down is likely to be the villain of that story. Clear, candid and consistent communication prevents these narratives from proliferating. As undignified or uncomfortable as the truth may be, it’s likely that it pales in comparison to the narratives an angry public is likely to construct.
While self-disclosure will invariably win the hearts of crowd, the temptation for self-protection is understandable, particularly in the face of an outraged public who is looking for someone to blame.
In responding to a question surrounding ethical conduct in public servants, National Anti-Corruption Commission (NACC) chief Paul Brereton pointed out that while Bayer Rosmarin’s resignation satisfies what he describes as Australia’s ‘blame culture’, it fails to genuinely benefit the community.
“If we recognise that mistakes will happen, accept responsibility for them, put things right, rather than just going to find a scapegoat, we will do a lot to improve culture in the public service.”
Taking the blame is not the same as taking responsibility. While Optus may now have a scapegoat, it still lacks solutions for the complex set of operational and systemic issues which led to the crisis in the first place.
Corporate Governance Expert at RMIT University Helen Bird analysed the Optus Senate enquiry with the ABC, “What was revealed by [the senate inquiry] was a fundamental failure to assess this as a significant risk. They thought there’d never be such an outage… But anyone can tell you an outage is like a cyber hack – it’s not a question of if it’s going to happen, it’s more a question of when.”
Based on these comments, it’s clear that one of the traps that Optus fell into is an age-old error of corporate hubris. Companies grow too comfortable, too confident and too cumbersome to be able to detect and respond to the looming icebergs that could sink them – leading to titanic oversights.
When the communication of 40% of a national population depends on you, these oversights matter. The companies that survive crises like this are the ones that trade their hubris for humility, and make use of the opportunity to get back to basics and restore credibility.
With all the persuasion tips and communication strategies being circulated at the moment, it is easy to forget that the best tactic for winning trust is being trustworthy. All the self-disclosure and transparency the world can’t save you if the thing being disclosed is glaringly flawed.
As the old adage suggests, you should never waste a good crisis. The one just past is a reminder for big companies more broadly to be prepared for the storms that will inevitably shake up organisations. But when those storms do come, it is clear and frequent communication, transparency around mishaps and humanised candour that will keep the ship afloat. An outage does not need to become an outrage.
Article supplied with thanks to Michael McQueen.
About the Author: Michael is a trends forecaster, business strategist and award-winning conference speaker.