CEOs are often in the front-line of crisis communications, but how should messaging be handled when the crisis has been caused by an organizational mistake, or even by a direct mistake by the executive in question?
New research from emlyon business school looks at this area.
Mistakes can harm an organization but also the CEO’s job security, therefore many CEOs don’t admit errors when they happen, however, this risks leaders not learning from these errors; and the organization not changing its practices, making it more likely that the crisis will be repeated.
When there is this clear trade-off between admitting a mistake and potentially losing power and control in the organization, it is important that CEOs use their language effectively to create a safe space for themselves in the organization – but how can they do so? This is the specific research question that Vincent Giolito, Professor of Strategy and Organisation, and Damon Golsorkhi, Professor of Strategic Management at emlyon business school, looked into. To do so, the researchers conducted 21 in-depth interviews with CEOs and board chairs leading 900,000 people in large financial firms in Europe.
The researchers interviewed the CEOs and board chairs on strategic errors in the organization and how they were approached by senior management, as well as the dialect and narrative behind the communication of these errors to all stakeholders. Interestingly, the researchers found a number of key themes that CEOs used for framing these errors.
When discussing key errors with severe economic and/or reputational consequences for the firms and important strategy changes, many CEOs stated that there was a process in which communication follows. First the CEO will acknowledge and diagnose the error, then they will dramatise it to put it into context for stakeholders, and then they will showcase the solution and how they are capitalising on this error to make changes.
The researchers say that it is important to collectivise the issue, using terms like ‘we’ or ‘us’ when discussing the mistake and how to change as a result of it, then there is less blame placed on one person – usually the CEO. Secondly, the researchers use the term, ‘temporalise’, which refers to CEOs showing that the error generates from the organization not adapting or changing quickly enough; and how there is a simple solution to solving the errors – adapting to today’s world quicker.
Thirdly, the researchers say that CEOs should generalise the issue and showcase how all firms in the industry are making the same mistakes, it’s not a firm-level error, but one that many are facing too. And finally, CEOs should isolate the issue, and show that the error is a one-off incident and a rare one; one that will not happen again.