Crisis Preparation Now Requires Response to Multiple Exposures from One Event
Social Risk Continues to Evolve
Stakeholders look at a company action from multiple perspectives. That’s why it’s increasingly important to anticipate these diverse reactions in order to plan effective responses to the range of issues. Here’s an example:
During April 2020, Amazon had COVID-19 cases in a number of its warehouses, resulting in employee protests and walkouts pressing for improved safety. This motivated “Amazon Employees for Climate Justice” to urge colleagues to call in sick. "We want to tell Amazon that we are sick of all this -- sick of the (coronavirus-related) firings, sick of racism, and sick of the climate crisis," said an AECJ press release. (Agence France Presse. 04/17/20)
This single scenario exposed Amazon to allegations of racism and other social risk issues. The employee group called out failing company policy regarding ESG issues, diversity and racial issues, and finally, the catalyzing issue of workplace safety.
An intersectional event presents multiple types of exposures at the same time. More and more social risk events, like the one at Amazon mentioned above, are intersectional. Companies need to treat these risks with extreme caution.
Why This Matters for Crisis Planning
Organizations preparing for risk events and crisis management circumstances now must prepare for event types – in combination. Failing to do so constrains planning, hampering crisis response.
Efficiently finding precedent risk events with likely issues requires sophisticated search tools – or an organized database of risk events classified by the type exposure. With this tool, a company can review risk event precedents, for example:
Racial issues impacting women
Employee free-speech activism compounded by terminations
Sustainability concerns combined with poor governance in other areas
Companies facing multiple risks from an event tend to experience more social risks – and these problems can cause significant reputational harm. A database approach that classifies multiple social risk exposures during single risk events enables you to search for relevant precedent that matches your circumstance.
MSA Can Help
We can help you research and identify relevant social risk events that can serve as planning precedents.
MSA Social Risk Data for Crisis Event Discovery
It all begins with an idea.
Corporations are encountering a risk exposure they are unprepared to address: social risk. The threats of labor and workplace disputes, diversity and inclusion issues, economic fairness concerns - and more – are buffeting companies large and small.
Marketing Scenario Analytica has developed a database of thousands of social risk events classified across many dimensions. We use a methodology called "crisis event precedent discovery" to help clients manage social risk events with this data.
Crisis event precedent discovery is similar to the process of legal precedent search. MSA queries its “library” of past social risk events for those that closely match a current problem faced by a company. The cohorts of relevant historical events can them be researched to determine reality-tested best practices.
The crisis event precedent discovery approach benefits MSA clients in a variety of ways:
1. MSA Sales Support: Demonstrate a strong understanding of the risks faced by prospects and customers, as well as those faced by their competitors.
2. MSA Preplanning: Use risk checklists, driven by historical and current data, so that you ask the right questions and uncover the main sources of risk for a given corporation, then help them develop effective plans.
3. MSA Crisis Response: Answer key client questions when a social risk event occurs. Has something like this happened before? Which actions were most effective? What are the likely outcomes to each response?
4. MSA Legal Support: Draw on situations that are similar to your case. Whether it’s litigation, government/regulatory issues, or the management of other legal exposures, MSA's data can provide an important reference.
5. MSA Social Risk Trend Analysis: Understand how risks have changed in your industry and in other industries that affect you. See how the nature of risks has evolved, including their type, the activists who promote them and their severity.
MSA's data, analytics and crisis event precedent discovery process can help your company better manage social risk crisis events.
All Social Risk Events Follow Patterns
It all begins with an idea.
A manager’s actions contradict corporate values. The actions go viral. The firm is under pressure to respond quickly and effectively.
Company actions can erupt into social risk crises that reveal exposures related to inclusion, #MeToo, product safety, income inequality and many others. Each of these exposures represents a separate social risk with unique characteristics. But they all require companies to exercise sensitivity and responsiveness to the opinions of employees, customers and many diverse stakeholders.
The firm recognizes the high costs of mishandling the situation. Instead of betting the future on a course of action based on subjective opinions and “gut instinct”, their approach is to study past events as precedents, seeking to learn what has actually worked in similar situations.
MSA’s research demonstrates that there are underlying logical similarities between all social risk events. These similarities create opportunities to define and use data:
1. MSA creates a database of social risk events with categories (fields) that capture each event's structure.
2. MSA uses the database to identify events from the past that are logically related to a current social risk crisis.
3. MSA and the client study the identified events for lessons to support crisis management and planning.
The company uses curated sets of past events to develop objective best practices for the situation at hand. Because they have hard evidence of what has worked in similar situations, they act confidently and decisively.
Bringing Order to Chaos: Classifying Social Risks
Situation: A company received loans from the Coronavirus Relief Paycheck Protection Program (PPP). Receiving PPP loans may create risk if the company did not comply with changing rules, appeared too large to qualify and/or must include the PPP liability in transactions. Corporate executives need to understand what could happen to their company’s reputation and brand.
To understand what might happen, the company could take past communications crises as examples, but how can they find relevant ones? Experts have a set group of “in-the-can” case studies, but “one size fits all” approaches can’t capture the complex issues that are often at work. Regular search (Google, etc.) doesn’t work either – if the firm searches enough of what’s important in the current situation to be meaningful, search engines will often only return “word salad” articles but nothing useful. Finally, let’s say the firm somehow acquires an unsorted list of the thousands of prior communications events that have occurred in history. To use it, someone would have to read about and understand them all and then decide which ones pertain to the company’s current situation.
Methodology: The company has access to a database that classifies social risk events into valuable categories. Instead of trying to prepare for a generic risk event, the firm and its advisors select important characteristics of the company’s unique situation to be matched to circumstances of other firms in the past, such as their industry, their corporate history, the current business environment, special circumstances (like the PPP loan), and the types of social risk exposures likely to impact the firm (diversity, etc.).
Here are some database categories that are helpful in describing communications crises and the circumstances in which they occur:
1. Drivers of company exposure to risk events (BLM, #MeToo, and Covid-19).
2. Industry of the firm as well as of key suppliers and customers.
3. Vulnerabilities based on firm shortcomings (business model, CXO behavior).
4. Activists protesting the firm (customers, employees, twitter activists).
5. Reactions to corporate shortcomings (newspaper articles, boycotts, strikes).
6. Responses of company to reaction (apology, investigation).
7. Outcomes of the crisis (fines, lawsuits, executive dismissals).
Solution: The company’s analysis of its own business coupled with the use of the social risk event database helps them find important examples from the past to guide their planning and preparation efforts. They study what worked for other companies and they prepare accordingly.
If you’re ready to go beyond guesswork when it comes to the future of your business, MSA can help. Our Social Risk Event database will provide you with insight that can help you understand and prepare for the biggest social risks your business faces today.
How Precedent Discovery Guides Crisis Event Management
It all begins with an idea.
Preparing for the surge in employee activism
A company’s employees have begun objecting to its perceived racial insensitivity, unequal treatment of women, and unethical business practices. Media coverage has intensified with each incident. Company management lacks experience in addressing this challenge. How can they prepare for the inevitable next crisis, whatever it might be?
Past events can provide valuable guidance about current problems. MSA can analyze thousands of past crisis events from its database to discover a series of precedents that fit current circumstance. This works even if none of the prior events taken alone closely matches the present. For instance, the coronavirus pandemic is a new challenge, and the BLM movement is currently disrupting at a new scale. How can MSA help you learn from history with so much that’s changing?
Searching the past for relevant patterns of events
The company and its advisors first use a social risk event database to determine which types of brand exposures present potential vulnerabilities. Then, the database identifies cohorts of events to cover these exposures. Each cohort comprises a set of events that together exemplify the types of disruptions that are likely to happen for one of the corporation’s weaknesses.
Cohorts of events can reflect a combination of data categories. For example, a precedent discovery analysis of employee activism may devote one cohort to the full range of past employee actions, independent of the specific risk. Other cohorts may include incidents that involve combinations of particular industries and event risk types. Taken together these cohorts of events can provide insights even in a brand new situation.
Understanding what worked helps plan a response
The company team drills down into the cohorts to discover how companies have responded in the past and what has worked best. The company uses a risk brief that summarizes important points to guide planning for each possible future incident.
The summarized risk event cohorts provide management insights just like precedents in a legal brief clarify the law. In both situations many carefully chosen, logically complex precedents are researched and then refined into a compact presentation that offers quick understanding and clear decision-making.
Let MSA show you how social risk precedent discovery can help your firm be prepared for the current business environment.
Using Historical Data for Business Development
New expertise for an unpredictable world
During February 2020, a company executive learned of a private coronavirus government briefing suggesting potentially serious negative impact from COVID-19. Actions by the executive and the company on this non-public information could undermine brand and management credibility for customers and investors who did not have the same opportunity to prepare. How should a crisis advisor approach this situation?: This unprecedented risk issue calls for communications expertise about circumstances that haven’t been encountered before.
New combinations of brand risk events are occurring regularly. For example: separate COVID-19 and insider trading risk events have been managed and resolved, but dealing with these risks in combination is new. There aren’t previous cases for reference; searching for cross-linked historical risk events will be fruitless. And even if there had been prior situations, a search engine couldn’t actually find all the precedent cases you’d need to analyze.
MSA’s database delivers organized risk event precedents
The advisor accesses a database of current and historical crisis events to analyze combinations of previous crisis events covering aspects of the situation for the company, its peer group and the entire economy. These cohorts include COVID-19, insider trading, government-driven activist events, legal exposures for executives -- and many more.
Given carefully constructed cohorts of events, you can find targeted articles, news reports, and other information about these events, allowing you to engage effectively, for the first meeting and beyond.
Mastering the new social risk landscape earns trust
Using historical precedent and cohort analysis, the company and their crisis advisors are positioned to develop effective, real-world tested approaches including proactive and responsive measures. And, as they proceed, they have a battle plan for action.
A database of crisis events is a new tool for today’s socially driven challenges. All business advisors -- PR and crisis management firms, legal firms, and corporate communications groups -- can use these tools to expand their relationships with their clients.
You can prepare for your business development needs quickly with just the right information from MSA.