When Crisis Hits: How Leaders Stop the Bleeding Without Making It Worse

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I have to wait until we're 30, 45, probably 90 seconds in to start making poop jokes because we are talking about what happens during a crisis. And you know I really want to talk about—

I know you do—

the fan and the storm, the umbrella, the umbrella, all the things that involve the, the poop. Yeah, but we can't do that because of the L. But yeah, for those of you out there that have experienced a crisis like what I'm experiencing right now internally, because I What I actually want to say— maybe you've had a crisis in your business. We're going to talk about how you should handle that. Stay tuned. She's the CEO.

He's the marketing and operations guy.

If it's broken, you need The Business Fix. So, so, like, we're almost summer now. Yeah. Graduation.

Graduation.

Um, no crisis there.

You mean like as a parent, like the emotional, my child is graduating, she's leaving forever, she's never gonna come back, we're never gonna see her again, this is terrible. Yeah, yeah, I'm in, I'm in internal family crisis, just of my own doing, right? No, I get it, no one else feels that way, right?

No, I, I, it's not actually a crisis, but it's like Oh yeah, it is.

Oh, maybe I need some extra skills to work through. Yeah, add some more skills. My resilient operating system.

I was about to say, because to me, what I'm wondering about this too is like, are your employees dreading this? Because they're like, Chrissy's upset. She's going to want to change something.

Oh, well, probably. Probably. But we're doing so much right now on the innovation side, I think. I'm keeping them as occupied as I need to be.

But if you get a random gift certificate from your employees for a spa day—

Yeah, then I would— Or they're like, "When are you going on vacation?

When do you leave?" "End of June.

3 more weeks. Hold on, guys. We'll be fine." Right.

They have it on their calendars, also.

They absolutely do.

And do they have it labeled as vacation?

They have it labeled. Chrissy's gone. We can all wear shorts.

It's vacation time because Chrissy's gone. Oh, I love this. Absolutely love this.

Yeah.

How about you? I'm just trying to get out motorcycle stuff, motorcycle stuff, motorcycle stuff.

Yeah.

With all the rain that has been happening throughout the spring. I'm beginning to wonder if the motorcycle purchase I made in January should have been a jet ski.

Yeah, I echo that.

I'm kind of like, that other motorcycle probably would have been better off as a jet ski. But we'll see. But it is what it is. I joked with my father the other day about mowing the lawn, because it could be the last time it happens until August, when The swamp finally dries up. Exactly.

Yeah. Well, just comb it.

Just comb it.

Just comb it down.

Just comb it. Just comb the grass to the side. You're going to sink, so you might as well just comb it. Right. Just comb the grass to the side. Oh my goodness. Wow. That being said, most crises for small businesses— like a little while ago, Spirit Airlines.

Yeah.

Um, a little bit of a crisis for that. But, and to me, like, that's— I've— my quick opinion on that is let them die. Um, and the big reason being is that's capitalism.

Yeah.

Um, they made some bad decisions. They're 3% of the airline industry. Like, if they go to bankruptcy, they will come back as a part of another company, or they will come back stronger. Yeah. Um, it— most people don't see that in their current small businesses.

No, it's a little different.

It's a lot different. Um, and there's so many things that can happen. And I mean, it could be a server going down, it could be a key, like, leader or salesperson or public-facing person quitting. Um, it could be a public mistake. Um, all I can think of is the obscene thing that was on the paper that the— they— that Dunder Mifflin sold in The Office. Um, like, this, this— as, as we were going through and writing some of this episode, like, I had that episode of The office in mind and like, how did, how did they handle this correctly and how did they handle this poorly? Yeah. Um, I'm not gonna bring someone by with a big check.

Yeah.

Um, I'm not a, I'm not a fan of the big checks. Um, really like we've gotta look, define internal. Um, there's an operational collapse, there's shadow workflows coming to light or a massive drop in team morale. Yeah. Um, we've all seen those happen. External, Those are the ones that the public sees right off the bat. The PR disasters, the legal threats, those are always fun. Or a public failure of brand promise. "Hey, we're going to do the thing!" WeWork comes to mind here for some reason. That being said, we're hoping you're not WeWork. We're hoping you're not Enron. We're going to talk about that systematic triage process to stop the bleeding. Yeah. Stabilize the patient, your business, and like protect the brand because you can come out like— contrary to popular belief, issues like this can be a blessing.

They absolutely can be.

You have— they have to be very, very well done. And I'm going to go through an example of that. When the house is on fire, And I believe you've experienced that. I have.

Literally and figuratively.

Literally and figuratively. Exactly. That's why I made sure to stick that in there.

Thanks.

How does the CEO maintain that long-term vision without getting sucked into the micro firefighting of, OK, someone lit a match. We don't need to throw a big wet blanket on it. We need to blow the match out. Operations is going to take care of that side, the match, the things like that. How do you take care of the long-term things? How do you say, "Look, we need to look beyond tomorrow"?

I think a lot of times people think the CEO doesn't always need to jump into the fire. But I'm going to be a little contrarian. I think that you should step into the fire, just not in the way that most CEOs usually do. Oftentimes they get really involved in the activity of operations.

Most CEOs I see, when they really try and get get involved in that, the only thing that they do is they light themselves on fire.

Exactly. So we're going to talk about how not to light yourself on fire. You're going to jump into the fire, you're not going to light yourself on fire. And you do that, you really have to anchor in calm and clarity. And so I've got 3 Rs for crisis leadership. So we regulate, we reveal, and we rebuild. Oh yeah, yes. Yeah, so super, I mean, easy to say, probably a little harder to do. So they have to start— I mean, the first one especially.

Let's just say the first one. First one. Especially for every CEO on the planet.

Yes, is regulate. And the first job of the CEO in crisis is not fixing, it's regulating. So if I am frantic or reactive, the entire organization is going to amplify that. They amplify your mood as a CEO. If I'm calm and contained, the organization is going to stabilize a lot Faster. Your goal as CEO or business owner in regulating is to get everyone to neutral as fast as you can. So in crisis, your tone is your team's temperature. I love that. So you drop that temperature as fast as you can. Now, don't freeze it out. It's okay to have emotion. It's okay. Before all of you are like, Chrissy told me to be an automaton. I did not. So regulate yourself, bring it down.

This is a recorded message. Right. No, not that.

Yeah, no. Not at all. So regulate your emotions. So remember, your tone becomes team's temperature. So the second is reveal, and that is to reveal what matters. All right? So not every detail or every data point, but three primary things: what happened, what we know, and what we're doing next. All right? And this is where I think a lot of leaders do it wrong because they either overshare and create panic, and I've been one of those, or they undershare and create speculation. I've been one of those too. Same. It just, 'cause you just, you do, especially when you're, if you're new into that role or even if you're a manager and you're new into that managerial role, it's really easy to either overshare or undershare. So you've gotta kind of, you know, reveal what is important. So those three things are a big deal. Silence creates stories. Clarity really creates stability. And we've talked about, you know, to be clear is to be kind. It works in a crisis too.

That seems like it's like a mantra.

It is. It's universal. So we've got, we've regulated ourselves, we reveal the information that is important. And then the third is to rebuild. And CEO's real job is not to fix the immediate issue. It's really to rebuild the system that allowed whatever it was to happen to happen. All right. Operation stops the bleeding. CEO makes sure that the organization doesn't deal with this type of issue next time. So leadership prevents that next injury. So in my opinion, Josh, a CEO really only has 3 things that they are responsible for. Everything else is noise. So they are supposed to hold standards, protect the organization, and prepare for the future.

Ooh, I like that.

Yeah. So rebuilding— Simple job. It's a simple job. Hold your standards. So it's rules for thee and for me, protect the organization. So you are helping it see around corners. You're hopefully preventing a lot of these crises from happening. And then you're preparing for the future. Again, making sure that you're doing that work. Rebuilding is, protection, and preparation.

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I know, I, I totally see it that way too. It really is. And it's that— it's funny, so many people want to make that CEO job tough, but really, these are your three primary responsibilities. That's it.

They are. Yeah, it's not— I always say it's hard— it's not hard if you stay focused. Yeah.

So yeah, interesting. Um, psychological safety usually goes away, um, when, when, when the going gets tough sometimes. And once again, this is where Regulate comes in, but When the going gets tough, some people will get frantic. "Bob, you idiot! You screwed that up!" How do you keep the team and lead them through that panic so they're not like, "Oh, I'm hunting for a job tomorrow. We're out of business on Thursday." Or they don't start that meeting after the meeting like, "Hey, Chrissy's losing her shit.

We've got to—" Or our customer, we lost our biggest customer. We did this, we did that. Like, this is okay. I'm going to send my resume. Like before. Yeah, before they all send it to Indeed. Correct. Right, right.

Before you go in and ever like before you packed up their desk, I was about to say before you open LinkedIn and see every one of your employees has opened to work. What do you do to kind of ensure that psychological safety?

Yeah. So, you know, in crisis, pressure goes up. Safety usually goes down. So it's— leaders can unintentionally destroy trust. Oh, 100%. A lot of the time.

I've seen it.

So let's go back to regulate, reveal, and rebuild. Okay, so regulate. If I react out of bad news with frustration or blame, congratulations, I've just taught the team to hide the next problem. Yep. All right. If I freak out and start acting like Chicken Little, the sky is falling, I don't care if it is, no one really follows Chicken Little. So you've got to figure out what the middle is within your emotions. We're not going to blame people. And we're not going to run around like Chicken Little. There is a middle road. I know it's hard sometimes to find it, but as a CEO, as a business owner, that's your job.

The sky could be falling. It could be. Don't say anything till it's on the ground.

Well, and even if the sky— you can say it in a way that says, you know what, the sky may be falling, but we're going to figure it out. We've dealt with those types of situations in the past. Let's catch this. Let's catch this. We're going to take a minute. We're going to talk about it, or I'm going to take a minute. I'm going to go to my office. I'm going to regulate my own emotions. Do whatever I need to do.

The way you said that is, I'm going to take a minute. I got to go to my own office and drink. No.

May cry, may yell. I may need to like write some things down. Scream into a pillow. I may scream into a pillow. I may lay on the floor for a few minutes and breathe, but I'm going to regulate my emotions because again, your tone is a temperature. So we regulate. Second is we reveal. So I have to tell the truth quickly enough so that people don't fill in the gaps. And at the same time, I have to hold the line as the leader not to overshare. So it's holding that space, regulating my emotions, and revealing the amount of truth that everyone needs to keep moving forward. So we regulate, re-reveal, and then rebuild. All right? If you've lost trust, you have to get it back as fast as possible. This isn't like, "Oh, well, we'll work on rebuilding trust." No. Crickets. No, no, no, no. It happens now. And you have to do that, especially when things have gone wrong. So, you know, Psychological safety, we've talked about this. It doesn't mean being soft. It doesn't mean removing pressure. It means removing the punishment for honesty. And this is really where, as an organization, if you're in crisis, you have to have everyone on the same page and being able to share the ugly truth with one another as quickly as possible. Mm-hmm. Another thing I would say is, as it, as it relates to rebuilding, the same thing goes with it. As you rebuild psychological safety, you also rebuild your confidence as a business owner. So one of the most important things that we have to protect as business owners is our entrepreneurial confidence. Yep. So Dan Sullivan talks about this all the time. So you are going to deal with hard things as a business owner, as an entrepreneur. Not everybody wants to like make payroll every week and not pay themselves. I mean, these are things that happen. You can't let it completely destroy you so you don't want to move forward or make another decision. You have got to make sure that you protect your confidence. Same thing also goes for your team. So if people feel safer staying quiet than speaking up, your crisis has just doubled in size. Yep. And that goes for your team. It also goes for the small entrepreneurial voice inside your business owner head. You have to make sure that you protect it. Whoa.

And rebuild it. Yeah. What, when, since we talked about trust. Yeah. When that's broken externally, as the CEO, what's their role in owning the mistake versus protecting the company like, personal and like legal standings. The look on your face and just the— you did a nice job of not doing it into the mic, but just the—

breathe in for a minute. Yeah, these are the things that we train for.

I almost feel like if the studio seats had a seatbelt, you would have buckled up. Yep. All righty.

So owning the mistake is not the same as exposing the company. Agreed. Yeah. And that's where leadership maturity really shows up. So you talk about like how to handle this. This is, I mean, yeah, it's buckle up because you got to have responsibility without being reckless in this situation. You may want to be like, it's this person's fault. This is what happened. This is, or you want to share the whole awful. No. So again, we go back to the 3 Rs, which I think are really great. So We regulate, which means we don't respond emotionally. We respond intentionally. Yeah. So you've got to regulate yourself. And then revealing again, it's pretty simple. It's what happened, what you own, and what you're fixing. Yep. And you answer those 3 questions succinctly. If you do not have the ability to do that, get coaching around it. This is when you do call your lawyer or your insurance company or someone who deals with Crisis PR, because they will help you distill it down so that you don't create a bigger problem for yourself.

Correct.

So that's the big issue because we, we do not want to overexplain and we do not want to blame. No. And then the third is rebuild. Again, most important part because you show the system fix. So because, you know, I love it when people apologize and don't do anything about it.

Sorry, we messed up. We're going to continue to go forward.

We're going to continue. Yeah, you talked about Spirit Airlines before. Sorry, sorry if we abandoned you. We're going to continue to abandon you. Phenomenal example. So, I mean, apology without action is just PR noise. Okay, we don't just say something, we have an action plan attached to it. And this is what also rebuilds your team's confidence. It rebuilds your confidence and it rebuilds the confidence of customers and the public. So an apology without a process change is really just a performance. Oh, I like that. You say that in parenting too. Yeah, or in any relationship. An apology without a process change is just a performance.

I, I don't know if, I don't know if the missus wants to hear that.

Yeah, so, you know, here's a summary of all things. So we regulate. So in crisis, your tone becomes the team's temperature. We take the temperature down internally for yourself, you emotionally regulate so you can lead your team. Yep. Revealing, then silence creates stories, clarity creates stability, and we know that crisis reveals what culture was already hiding. And that third is rebuild. So apology without action is just performance, which is why we fix the system, not just the symptom. And so here's also a thing as it relates to speed, 'cause I think a follow-up question would be like, how fast should I respond? 'Cause as a business owner, You probably wanna respond like 3 seconds after the email happened or the news story hit or— Oh my gosh, yes.

I see it all the time.

Yeah, and I think sometimes, not sometimes, most times, leaders get too focused on speed in crisis. Yep. I have, now, now, now, now, now. Yes, you need to respond quickly, but if you respond fast and wrong, you are creating a second crisis. It is okay to walk to your office, close the door for a minute, Gather yourself and move forward. So I would much rather see calm, clear, and correct than just fast. Because fast usually breaks things worse.

Yes. Yeah. No, you don't like— Yeah, no. Be thoughtful about what you're fixing.

Yeah. So we talked about from a CEO perspective how in crisis situations, I mean, you— Let's try this again because I'm like, wait a second. Let's talk about you because my favorite subject is true. I don't disagree. I have to emotionally regulate and move forward. I have gotten really good at staying calm, but I will say, like, you are creepy calm. Yeah. Like, you're also direct and deliberate, but you are creepy calm in crisis. Correct. There are times where I'm like, I might need to call Josh for this one.

Right. Right. He's just going to sit there and act like nothing happened.

When you're in crisis mode, what are you looking at from an operations standpoint?

First, treat it like the ER. Stop the bleeding. Someone comes into the ER, let's say it's a gunshot wound. What's the first thing they do? Stop the bleeding. They're not digging the bullet out. They're not like, "Hey, what do we have to do?" Stabilize.

We stabilize the patient. Right.

Let's make it so this isn't spewing blood all over the room. To me, This is where I— and I'm gonna go back to psychological safety on this. There's like, any employee, regardless of where they're at, they should have the authority and the obligation to stop production, stop whatever, the moment they see something going sideways. And sometimes the machine may stop and you're not gonna like it, but I would rather typically have it stop a little bit too often because it's better to face the production delay than it is to let the faulty or incorrect item make it out the door. Ask Ford, ask GM, ask Dodge, and ask Toyota what they're all dealing with right now in terms of recalls. Oh, yeah. It's because they let faulty items go out the door. It's bad processes they've all rushed through and they said, "We can do this." There was plenty— I'm reading about plenty of red flags that were raised internally that are like, "Mm." This isn't going to work. Yeah. Um, so that is, to me, it's the big thing, be having it so people can pull that cord to stop the line. Granted, I realize it's a little bit different for Ford, it's a little more difficult, but in most small businesses, to be able to pull that. Now, to me, I, I'm going to look at the systematic fix instead of the symptom fix. And what I always like to say about that is, I have a headache. Is it a headache or a stroke? Because the treatment for that is very different. Very, very different. Um, yeah, and I— this is where I encourage people to ask, like, act like a toddler. Um, you should ask at least 5 whys. What ha— why? Like, beyond the surface level, if, like, let's say the customer served a wrong order, don't ask who did it. You ask why. And then when they say, oh, well, this, like, Bob screwed it up, well, why did Bob screw it up? Not just Bob screwed it up. Why did Bob screw it up? Because you're taking away blame. Correct. You're taking away blame. So now you finally hit the failure in the operating, either the procedure or the process, or you're hitting that in there, but you're taking it all the way down to that. The problem is, is if you've got it, so it like, you should get it down to process instead of the people that are breaking it. Now, if a person goes outside of the process, then that's still an operational problem. That's just with the person. The other thing that I want to— that I really want to say with this is if a person can break the machine, you've got a poorly designed machine. Yeah. If one person being a little bit off breaks everything, you got to look at your processes again. So to me, addressing that why we had to pull the red cord immediately, that's the priority. Now, if it goes out beyond that, we're going to— that becomes more of a marketing and an operations issue that we're going to dive into. The other thing is I'm going to play off of your regulate, model what you mandate. You've said that multiple times. If you are creepy calm and deliberate, deliberate, I have found your team typically mirrors that. If I act even a little bit frantic, my team is like, oh, oh, this is, this is bad. This is very bad. This is very bad. Because they're so used to seeing me as like the, this straight, deliberate, like, so yeah, when they see a little bit of elevation, they're like, uh-oh, uh-oh. So no. And that to me is why it's like, okay, look, this sucks. This is bad. And saying that out loud is okay. But making sure that you're, you're calm and how you're going about— because like you said, I have seen so many people try and fix problems that they fix the problems with all the strategy of a toddler, and they do it in a panic. So they fix the problem and create 8 more breaks on down the line. Let's be honest, you did not start your business so you could spend your days buried in HR paperwork or Googling how to handle employee drama.

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Yeah, because crisis can be a really good teachable moment if you— oh, you navigate it correctly.

It 100% can be. And part of it is too, is in that regulation, is like If you go about it in a calm way, realizing like that if it's an angry Facebook post, so many people— I watch this all the time in marketing. Someone sees an angry Facebook post and they've got to respond to it the next 3 minutes. I'm like, no, no, no, no, you can respond to it in 4 hours. No one cares. With this going back a little bit, to me, the, the who and everything like that should— the real story's in the data. Yeah. Look at hard numbers with word data, is what I like to call it, because if there was a problem that Bob had, ask the 5 people around Bob, as well as Bob, to figure out what happened. There is a great story that Neil deGrasse Tyson has about being— and look it up sometime— about being in court as a juror. And he talked about how people don't remember things that just happened very well. Correct. And so if you take 4 or 5 different stories about this, you're probably going to be able to assemble the story. Yeah.

So you made a point, you're talking about, you know, Ford and Toyota and different, some different things that were operational issues creating operational crisis. And I was thinking as you were talking about that, about Boeing and how Boeing wasn't an operational crisis. And I would say also Ford when they had the Explorer. Yeah. Oh yeah. Those were, those were C-suite level of we have created an environment where no one is able to speak up. It's one thing when you speak up and you don't speak up fast enough. It's another when you speak up or it just gets absolutely buried because we, we cannot talk about the fact that we make mistakes. And it's really costly. We're all perfect. We're all perfect. So, It's the guy next to me. He's the screw-up. Exactly. Having talked about Boeing, Ford, when they had those issues, they got really stuck in some PR nightmares, right? Oh my God, did they ever. It didn't matter how quickly they were able to stabilize their machine, they had ripples. I want to talk about reputation. All right? See, look at me. Yeah. Figuratively landing a plane. Okay. Machine stabilized. With or without the door? Without the door. Apparently you can do that and it's perfectly fine. All right. So we've stabilized the organization or the machine. Okay. We have to look at reputation. Yep. How should the marketing and PR piece be handled both internally for the team and externally for the public? And how do we prevent the brand from being permanently stained?

It's funny, and I am so glad you brought up the internal and external piece because to me you really need to address it internally first. Yeah, I agree. Internally becomes externally very, very quickly. Uh, so to me, it like, the first thing is preventing sabotage. If you don't provide information, the team will fill it in their own. Yeah. Um, and then tell the team first, here's the problem, here's the fix, here's your role in this, here's how we are going to make this better, here's how we are going to fix this. And once again, this isn't a Bob screwed up, so you're all gonna have to work overtime. That's not it. It's, hey, we've got a problem here that we need to address. And once again, the story internally and externally needs to be somewhat the same. But really, it's, once again, it's gotta be an honest, here's the problem, here's the fix, and here's your role. That's it. When you put it that simply internally, it's something that people can latch onto and they're like, oh, here's how I can make sure that I have a job tomorrow. And once again, it shows them that there's a way out of this. The trust over pizza principle. I love this because you need to include the team in both the communication about the solution and the development about the solution itself. It's going to demonstrate that operational trust. Hey guys, we screwed this up. I need your help to fix it. Like there's all the we and I need your help to fix it. That like, once again, it's, it, I need your help. I trust you in this. I trust how you're going to fix this. I trust how you're going to help us fix this because you're the ones doing it. If you like, you guys screwed this up and now I have to fix it. That— no, no, gone, done. That's— I mean, it's just— it just ends right there. And so this is the way to bring the team back in. Like, hey, this is screwed up. Like, I need your help. Yeah, whatever I can do to get your help, that's the big thing. When it comes to external marketing, this is where so many of them screw it up because they're like, ah, the people don't know any better. They assume the population is idiots. Mm-hmm. Just the uncomfortable look on your face.

I have some thoughts.

Let's hear your thought about them assuming the population is idiots because I feel like that's what people do.

Well, I think they do. And I think that part of it too is you can visually see it. You can visually see when an organization has not addressed the internal communication in the external, in part. So like when there's a 60 Minutes and everyone's interviewing the engineers that screwed up and they are dark and you cannot see their faces, you know that they still don't admit that there's an issue. There's no acceptance of that issue. And so when you see them all and they're like, "Yeah, we screwed up, but we're people and we make mistakes and this is how we're going to rectify it," and you can visually see those people, then it's transparent. So I'm thinking like, "Oh," when people have done it wrong versus when they haven't. I mean, this isn't easy.

No. It's not. No. To me, once again, the regulate but strike fast with something. Yes. If you don't speak quickly, the story's gonna get written for you. Oh, so— Right or wrong.

And way faster now than it used to be. Correct. I mean, 10 years ago, you maybe had 24 to 48 hours.

Like now, you got like 10 minutes. Yes. So, but to me, speaking quickly does not mean spilling your guts.

It doesn't mean, don't be stupid. Yes.

Right. And to me, speaking quickly can be like, Hey, there's an— like, I'll take the Boeing issue for example. There's an issue with doors flying off of planes. We are conducting a full investigation. We are looking. I am— I hope to have something for you in 4 days. Now you've put a timeline on it. Now you've said we're doing an internal investigation to this. You've addressed things in a way that once again puts a timeline to it. And we're corroborating with everyone. But you have to do that in earnest and you have to do that pretty much instantly. Yes. Boeing, the first door that flew off, they're like, eh, happens, right? That's just once. Just once.

Wasn't in the United States. We didn't deal with the FAA. It's no big deal, right? No, it is a big deal, right?

No. So to me, that is the thing where it's like, this has to be addressed right away. And the problem— I know exactly how that went. And you do, too. Is it just happened once. We've got a problem. We know we asked for this design change that is going to cause a bunch of issues. What, what can we get away with here? And the— once again, people can tell the attitude. What can we get away with here? Like, they can smell it from 1,000 miles away. They can smell it from 30,000 feet. Uh, nice job. The, the other thing is too, is the 'I'm sorry you feel that way' is, is horrific. I hate that. So do I, because once again—

It must be hard for you. You know what? That's not something you say in consumer protection. No! That must be hard. No! You almost got sucked out of an airplane.

Right, because you're putting blame on them. It's very much the passive-aggressive way for blaming them. It is. You shouldn't have sat so close to the door, moron.

You wanted to drive the car that had faulty airbags.

It's not my fault. Right. No, right. You need to state what happened without corporate speak and the facts of what happened. The door flew off of the plane. Yeah, that is what we know. Not, hmm, there was, there was a problem with the door, maybe. No, no, no, no, no. The door exited.

It is literally on TikTok. We can see what happened.

Right. No. Right. So sharing the why. And this has got to be like this. The systemic failure, not the list of excuses. And you can't be like, "Bob screwed up." But you can say, "Look, we had a problem with this process," or, "This process was changed and we found that this is an issue and now we need to do this." You have to tell them what is being done to ensure that this never happens again. Boeing kind of is like, "Well, it may happen to some other planes too." We might fix it. Maybe.

Maybe not.

Which planes? Some of them. I mean, it's that mushball response. Yeah. And once again, if you say, hey, look, it's this plane between this serial and this serial number, it sucks. But if you tell me what it is, I can believe it and I can buy into it and I can say, look, they're being honest about this. Yeah. If you say it's a couple of airplanes, Is it a couple? Is it a couple of hundred? Is it a couple of thousand? It like these general terms just don't work.

No. And what you do is you create a ripple effect for your customers who also have customers. So you got to see the airlines that had those planes and how they responded. And they didn't all respond the same way. Some said we are grounding our— all operations are ceasing until everything has been checked and we will slowly come back online. Fine. And then you had some, they're like, yeah, we'll just keep checking them.

Like, okay, right, right. Not to— not sitting—

I'm not flying on your airline for at least 6 weeks. So, correct.

And this, I mean, I'm going to get into the, the best known example of this here in a second. It is, to me, it's that it's— if it's a value failure, like if it's integrity, the CEO speaks. Yes. Um, if it's a process failure, put the operations manager or someone like that. You should have someone picked in your company that presents well. Yes, I know a lot of CEOs that if you give them this microphone, like the dumb falls out of their face.

Yes. They stand, they sit next to the person who can do it well, just sit there and smile.

Right. And that's, that's all you need. You need the CEO, but you need the person that presents well. Yes. To do it. The CEO that's kind of, mm, no, no, no, kind of shifty. No, you need the person that can stand there confidently and— pardon my, pardon my expression with this— you need the person that can stand there confidently, eat the shit sandwich, and not necessarily smile, but look, but look at everyone and say, yes, I am eating the sandwich, and I know I need to eat this sandwich. That's all. That— you need that person that can do that. Um, what I want to talk about is there's the, the most beautiful Brilliant example of this is Tylenol. Yes. 1982, there's the cyanide crisis. That is the gold standard of crisis management. If you've never looked it up, you need to look at it. Long story short, 7 people in the Chicago area died from ingesting cyanide-laced capsules in Tylenol bottles. Yes. They would— like, you would think if our product kills people that this would be a disaster. You take Tylenol, right? No problem. Don't even think twice about it. Tylenol, first off, they ordered a nationwide recall of approximately 31 million bottles. $100 million. Granted, your business may not be able to suck up $100 million. But keep in mind, this is Johnson Johnson here. There's scale involved here. Despite— and this is despite evidence occurred at the retail level rather than in the factories. Once again, they overreacted for confidence. Chairman James Burke was candid with the media, holding frequent press conferences and appearing on programs like 60 Minutes, like you said. I don't think you're going to get on. Joe's Shake Shack has an issue.

You have to be on 60 Minutes. Right. Call us.

Right, right, right. But they established an 800 number. I mean, they did with taped daily updates. So if you had an issue there, they had public safety warnings before the full recall. They used mass media. They even had police loudspeakers to warn the public not to consume the Tylenol. I mean, once again, this is a little bit of an overreaction. But this is about trust in your brand.

And public safety. I mean, they are a case study for how to handle something that impacts, in essence, almost every person in the United States. They had to have this. 100%.

Question for you. Anytime you open a bottle of anything, it's a giant pain in the ass.

It is now. Thanks, Johnson Johnson. 100%. And I'm not complaining about it.

No. I'm saying thank you. Triple-sealed, glued box, plastic-sealed neck, and a foil mouth seal. Uh-huh. Within 6 weeks, they introduced all that. Yeah. They made a shift to Caplets. I mean, the response was really, I mean, guided by their moral credo and a corporate philosophy that was like stating the company's primary responsibility is to the people that use their products. And that is your primary responsibility as the business owner, as the manager. It is the people that use your products. If you take care of them, if you make them feel— people make mistakes all the time. Yeah. If you can make them feel like, hey, we've done something to make sure that this mistake won't happen again and honestly apologize to those people and they know that you're working to correct the issue, you've now strengthened the relationship. You have. You can cruise along and have no problems your entire time, but I guarantee one or two hiccups in a relationship with to someone makes it that much stronger. The interesting thing about it is, Tylenol positioned themselves, too, as the fellow victim of crime. But they owned it. They're like, "This is our product. We're going to make sure—" They regained nearly all of its market share, again, within a year, which for them, that timeline's nothing.

It was unprecedented what they dealt with. It was also unprecedented how they responded, which is why they are the example for how to manage a crisis. Effectively and efficiently. It was.

And I mean, the other thing that I see with this is you realize with this, this was not like they had this playbook somewhat outlined ahead of time. Yeah. You should do the same. What happens if your product goes out the door? Let's say you sell food. Mm-hmm. What happens if you get a bad batch of chicken? Yeah. How do you address that? How do you look at that? I know a lot of restaurants ignore it. Yeah. And you shouldn't.

They're like, oh, I'm sorry. Right. I want more than I'm sorry. Right, right, right, right, right. Or not our chicken.

Right. Here's a question for you. So, and I'm sure you've seen this, an innovative shortcut. Have you ever seen those lead to those crisis? And then like, once again, it may lead to the crisis, but then, hey boss, I got a bandaid. This is going to fix it right now. Yeah. Leading to the secondary crisis, which is 3 to 5 times what the first crisis was.

Mm-hmm. We have— here, let's dump gasoline on the fire. Let's just— here, here's a blowtorch.

I feel like as soon as this episode's over, Chrissy's going to go out drinking.

This is like, I'm going to have an ulcer. I'm going to resurrect. I would say, you know, crisis is not the time to experiment. It is the time to stabilize. Yes. So we don't— we may have to respond in new ways, but we're not like brainstorming all the new things and the ways to be innovative in navigating a crisis. Johnson Johnson did it well. Follow their example. Yeah, 100%. I mean, Boeing did not do it well in a situation. Don't follow their example.

Yeah. Yeah. And I mean, it's like there's tons of stories and articles about like how they've handled these things. That are great articles about that. My big thing that I have always find is even a temporary fix has to have like, especially if it's a temporary fix, it has to have an expiration date. Yes. Otherwise, like before you know it, you, your company is— we've all seen that car going down the road that has the— or the truck going down the road that has the tailgate, that has the tie-down strap holding the tailgate on. There's like duct tape over a window.

That's your business. Yes. Well, and go back to your medical example. I mean, we don't— most of the time we stabilize the patient and then we figure out course of treatment action and we talk about what that's going to be moving forward. We don't just leave the person stabilized on life support and walk away. We have to do things to maintain it. So you've got to go back and communicate.

In your work with Clarity HR, fractional HR, How often do you see the owner's ego as the obstacle to resolving a PR disaster? Um, it happens a lot. I mean, I've seen it all the time.

Yeah, I mean, it's not just, it's not just in Clarity. I think it's, it's as a business owner, if you work with other businesses, you can see that happen a fair amount. And if a leader can't admit fault, the organization can't recover. No. So I would, yeah, ego slows resolution way more than like complexity does. Yeah. Because it'll grind to a freaking halt. Nope. Instantly.

And I mean, to me too, like the thing that I see about it is like, I know so many people that can't make a mistake. And when you see that, you're like, oh, how fragile are they? Yes. And like, business ownership, even like any sort of leadership, any sort of leadership at all is not for the fragile. Yes. You've got to have the durability. You've got to like, you have to take the hits for your people. Yes. You do not want your people to take the hits.

No, you do not. And I would say too, you don't bully your whistleblowers. So, oh gosh, if you have— here's, I am watching one right now. It's a situation where a business took investors and those investors, 18 months into an investment, said, "Hey, the revenue doesn't seem to be going the way that we thought it was supposed to. And some of the things that like we— there were like 30 payments, but we were supposed to have 31 payments. And, you know, things seem a little bit off." And that CEO was like, "Everything is fine. Why are you even questioning me?" We're going to fast forward 24 months later. Where now that organization is under investigation for fraud because the CEO was too arrogant to pay attention to what was going on underneath him. And he's dealing with a massive fraud investigation that lost probably 50% of that organization's revenue, and they don't know if they're going to survive. Ouch. Yeah, you talk about egos being expensive. Yeah. And this is one where I just watched and I'm like, I don't like this. I like how he's responding, but it all could have been prevented.

I mean, you can, like, you can face the music now, or you can face the music later. Um, later, that music is louder. And as old as I am, it does not take too much for the music to get too loud.

No. And if your ego is that fragile that you cannot handle that criticism or looking at something, you know, I don't think you should be a business owner or a business leader.

No, no. Um, something else that I have found too is, like, you can see There's two ways to look at this. You can see when you've got your team on board with you and you can see when managers, like when you look at the department and you can see when managers have their team on board with them. Yeah. You look at who's going to get focused, who's going to get frantic. To me, it's that, it's when that coach, correct, or cut becomes real time. Yeah. Because you can see who can handle this and who can who can move with a crisis.

Well, you can really see it in team dynamics between different teams, who is managed by someone who has some emotional resilience and some capability around how they regulate, and those that do not. Oh yeah, yeah.

I've been around some yellers, which is always interesting. A couple of takeaways from today. Um, first, 60 Minutes war room. Okay, make like, buckle down, um, and like, the clear communication process. How are we going to communicate this? Yeah, don't just walk out into the streets and be like, guys, guys, guys, guys, listen, listen, listen, listen, listen, listen.

I have a plan on this Post-it. Right, yikes. So I would say you control the communication cadence So you don't just communicate, you structure how often you're going to communicate and how clearly communication happens. Yeah, yeah.

No, that's a big one. The other thing that I like is like variable isolations. You can't— like math problems, it's tough to solve for two variables. Fix one lever, look, look at what changed, move to the next thing. Yeah. If you pull 10 different levers, you have no idea what fixed it. No.

And I would say we're separating signal from noise because in crisis, not everything matters equally. And so leaders have to divide what gets attention, which is why we regulate, we reveal, and we rebuild.

Yep. My other, the last one I like is, like, success is a shared thing is our core value as a company. An apology without an operational fix, I'm going to steal your line, it's just shitty wall art. It really is. It is. We're sorry that happened. We're going to continue to do it that way, but we're sorry it happened. No, you're not. No, you're not. That once again goes back to your relationship advice from earlier with that. Should you ever fire a customer during a crisis? Yeah.

Yeah. Yeah. If they violate values or destabilize the team, absolutely. Revenue that destroys culture is not worth keeping ever.

No, it's not. It's really not. If they start the yelling and screaming, I can understand someone being excited. I can understand understand someone being upset, but as long as you approach them with, hey, here's the solution, here's what we're going to try and do to make this right, yeah, you should be good. If they don't like that, well, uh, the next one— and as a video company, I love asking this one— the apology video.

Yes. Um, are you asking me like, what should you or not do it?

What are you— or shouldn't you do? Is this— at least this— are these meaningful are these cringy as hell? I think it depends.

I mean, if it's authentic, if it's specific, accountable, and shows change, then they can be great, especially like replaying for a lot of people. If it's like— if you're Johnson Johnson, an apology video made a lot of sense. Um, it's cringe if it's vague or defensive. You're like, we don't have a problem, people have been saying this, we're fine, we're just as strong as we've ever been, as doors fly off your airplanes. I mean, you just don't do it.

No, no. I, I have found that some people are just so disconnected from the, from their customers and from the people that are aware of things that like you have to. One of my favorite sayings is, before you walk a mile in someone else's shoes, you have to take off your own. Yes. And I see it in so many cases where the CEO steps up and is like, this isn't a problem. No, right? It's like, it may not be for you on a day-to-day basis, but for the person sitting in row F, that's a problem. It's a problem.

No, especially if they can't, if you cannot show authenticity or any type of emotion, you should never do a video. And if you have to read your apology like a hostage video, you shouldn't do it either.

No, I, whenever I see those, I'm like, oh, this looks like the most inauthentic thing.

My lawyer is making me read this. Right.

Yeah, no, so funny. And we both know people that on camera, as soon as they get on camera, they're like, hire someone All right.

What's the emergency SOP every 10-person company needs to have in a drawer?

There's two. Okay. Supplier issue is one. Like, what happens if supply just gets cut off? Agree. Agree. The other thing is, is just this triage plan for if things just start to come off the rails and you've got— you're going to keep it very general. But if you don't have at least a base outline this all goes out the window. What about for you?

Similar. It's the disaster part.

Just the disaster plan.

I mean, it's also 2 pages. If something happens to Chrissy tomorrow, what are the 10 things that we need to make sure that we make payroll next week?

Yeah. Yeah. Yeah. Chrissy just loses her shit and doesn't come in.

Or she doesn't decide she's not coming in. She goes missing for 3 weeks.

He said her Instagram is suddenly filled with beaches. You have an idea what's going on. That being said, thank you everyone for coming along for the ride. Uh, we're always glad to have everyone go to businessfixpodcast.com, give us topics, let us know what you want to hear. Um, the, the next is we are going to talk about how to manage or fire Your Most Toxic High Performer, because this sounds— once again, like, I, I love some of the topics we're covering right now because this is just scary as hell. Great. So I woke up screaming, screaming thinking about this. Uh, so yeah, we'll be in good shape. Do us a favor, take care of yourself. If you can, take care of someone else too. We will see you very, very soon.

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