Thursday, May 16, 2013

When bad news comes knocking, get in front of it fast with honesty and transparency.

Where's my crisis communications plan when I need it?
One of the really great family-owned grocery chains got hacked this winter. It was really serious. It impacted 2.4 million credit and debit cards.

Based on reading a number of accounts from the company, media and lawsuits, here’s the problem’s apparent timeline:

  • The credit card problem started in December 2012 and extended until March 28, 2013.
  • A credit card processing firm informed Schnucks on March 15 it had tracked credit card breaches back to Schnucks stores.
  • Schnucks immediately hired a computer security firm to examine the problems.
  • The firm and company “resolved” the breach about March 28.
  • Schnucks notified customers and the media of its credit card issues on March 30 ... two weeks after it first learned of the problem.
  • Last week (on May 10), the Schnucks chairman issued a video apology
That two week gap represents a major reputation issue for Schnucks.

The company failed to alert its customers of the issues (as it knew them at the time). Meanwhile, their customers were telling friends and neighbors that their cards had been breached. And, then, for the company’s chair to issue an apology six weeks after the fact. Seriously?!

From my perspective, the Schnucks’ case shows the danger in not being fast to inform customers (members).

In these types of cases, waiting until you know all the facts can cost you valuable good will.

  • It makes me wonder if Schnucks has a crisis communications plan. And, if not, why not? 
  • Were their actions guided by company lawyers advising to wait until they knew the whole story? 
  • Why did Schnucks continue accepting credit cards after knowing of the breach but before it had blocked the problem?
In today’s fast-paced world, speed, transparency and honesty are vital for your reputation.

This applies to associations and the industries/professions they represent.

And, it starts with a pre-determined crisis communications plan to guide you when faced with a crisis. You don’t have time to create one on the fly with media and members/consumers knocking at the doors asking your CEO for answers.

No comments:

Post a Comment