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Top Ten Tips on How to Manage a Company Crisis

Eighth Tip: Adjust Promotional & Sales Practices 

Expert panelists at the MSBA Legal Summit recently discussed the Top Ten Tips on How to Manage a Company Crisis. The program was moderated by Marisa Trasatti, Esquire, partner at Wilson, Elser, Moskowitz, Edelman & Dicker, LLP.  The top ten tips on how to manage a company crisis were identified by the panel of crisis experts:

    • Determine What Activities the Crisis Management Plan (Before the Crisis)
    • Formulate the Crisis Management Team
    • Assess the Crisis
    • The Initial Response
    • Insurance
    • Manage the External Appearance:  Public Relations, Media, and Customers
    • Manage the Internal Appearance – Advising Employees and Communicating with Key Opinion Leaders
    • Adjust the Company’s Promotional & Sales Practices
    • Response to Regulatory/Law Enforcement
    • Concluding the Plan

Last week we discussed the importance of managing the internal appearance and advising employees and key opinion leaders.  The panelists urged instructing your employees to refrain from independently responding to questions within and outside of the company unless approved by the crisis management team.  The panelists also recommended communicating with your employees and monitoring the company’s and employee’s personal social media accounts.  This week we will be discussing the eighth of the above ten tips that the experts identified on how to manage a company crisis. 

Eighth Tip – Adjust the Company’s Promotional & Sales Practices

Many companies invest huge amounts of money and time into creating an effective marketing strategy and building a brand.  Marketing can make or break a company.   Most companies today also have a huge online presence and many only have an online presence.  A crisis may make your shareholders or customers question whether they can trust the company. Consequently, if a crisis hits your company, the crisis management team may need to consider adjusting the company’s marketing and promotional and sales practices.  

Linda Lenrow Lopez, Director of Operations, Risk Alternatives, L3 Management Innovations, LLC and a public relations expert served on the panel of experts and highly recommended that a company work with outside counsel to determine whether a company’s promotional and marketing materials need to be adjusted during a crisis.  Of paramount importance once a decision has been made to adjust the company’s promotional and marketing materials is to craft a message, stick with it and “make sure the message is succinct and narrow enough that you are not leading anyone to broadly interpret anything,” she said.  Ms. Lopez also suggested that your company may need to refrain from using promotional materials that were previously created.  Your company may need to create new ones and that could get expensive. Finally, Ms. Lopez recommended that the crisis management team consider whether suspending materials “affects other goods in the product line.” Once a decision has been made by the crisis management team that adjustment of a company’s marketing materials is necessary then implementation and enforcement should not be delayed.    

When reviewing a company’s online presence to determine whether a crisis triggers a need to adjust promotional and/or sales materials for a company, Ms. Trasatti recommends your crisis management team use a webservice called “WayBackMachine.”  WayBackMachine is a digital archive of the World Wide Web and allows one to go back in time and search collections of digital content including a company’s older websites.  A user can access what your website looked like as far back as 2001.  As General Counsel of Sciton, Inc., Ms. Trasatti led her client through a marketing crisis triggered by an FDA inquiry into their marketing.  The FDA was reviewing Sciton’s websites, domestically and internationally. Adjusting the promotional materials in Sciton’s crisis became critical, she said.  Sciton started “sanitizing hand pieces, slide decks and websites across the world” to adjust their promotional materials.  Likewise, physical (paper) promotional materials including brochures should also be reviewed.

In sum: Your crisis management team should work with outside counsel to determine whether a crisis affects their company’s promotional and marketing materials.  If so, determine whether the materials should be suspended for a period of time or whether it is safe to adjust the materials as soon as practicable. Make sure the physical (paper) and electronic materials are reviewed.  Review should be conducted by the crisis management team, outside counsel and your marketing and sales team.  Sanitize websites if necessary.   

You may watch the eighth tip on how to manage a company crisis below:

This article is the tenth of a 13-week part series that will discuss in detail how counsel can help their clients create a crisis management strategy and manage a company crisis.  Last week, the MSBA discussed the seventh of ten tips on how to manage a company crisis. Next week, the MSBA will discuss the ninth of ten tips to manage a company crisis with comprehensive suggestions and actions for implementation.  Next week we will address the tenth tip. The final week will include a comprehensive summation of all the myths and tips including the advice and counsel of the professional panelists listed below.  In week one of the series, the MSBA generally discussed the top ten tips on how to manage a company crisis.  Week two was a detailed summary of the 7 myths of a company crisis. Some of the material to support this article was taken from “Top Ten Steps in Managing a Company Crisis,” by Marisa A. Trasatti, Zachary A. Miller and Sean M. Fox.  The MSBA wishes to express sincere gratitude to the professional panelists, without whom it would not be possible to offer this series.

Join us in the coming weeks as we continue to cover in detail the Top Ten Tips in Managing a Company Crisis.    

Panelists:

 Aaron C. Burton, CEO of Sciton, Inc. Sciton, Inc. is the largest privately held dermatological and medical device laser manufacturer.  Aaron shared his experience as CEO and especially the crisis that developed at Sciton during his first year. Aaron also generously shared how Sciton handled and endured the COVID crisis.   

Linda Lenrow Lopez, Director of Operations, Risk Alternatives, L3 Management Innovations, LLC.  Linda has more than 25 years of experience in private and non-private sector risk management. Linda shared her experience as a project manager and Director of Operations at Bechtel Corporation. Other roles Linda served at Bechtel include corporate risk manager for a global business unit and project risk manager. Linda currently works at L3 Management Innovations and draws upon her years of professional experience in this area to share with the group.  

Robert E. Scott, Jr., partner at Wilson, Elser, Moskowitz, Edelman & Dicker, LLP. Robert handles litigation on insurance coverage, drug and medical devices and many other areas.  Robert shared his expertise on crisis management and his insights on planning ahead to control future crises.

Sam Terzich, Gallagher Bassett. Sam is a current director of the company and manages specialty claims including product liability, cyber, environmental, pollution and product recall.  Sam has been in the claims industry for 25 years and will address the insurance issues that arise during a company crisis.                                              

Marisa Trasatti, Esquire, partner at Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, and also General Counsel to Sciton, Inc. Marisa is the moderator of the Top Ten Tips to Manage a Crisis. Marisa shares her unique experiences of managing a crisis as General Counsel for Sciton along with valuable lessons learned as counsel for an organization in the midst of a crisis. Marisa’s practice focuses primarily on civil litigation, with an emphasis on product liability litigation, including cases involving drugs and medical devices.  She is a past president of Maryland Defense Counsel and served as the DRI Maryland State Representative.