Crisis Management and the Number Two Rule of Holes

The art of crisis management is to think forwards and aim to stay ahead of the media, anticipating negative coverage and taking steps to mitigate reputation damage. That’s why it pays to be honest about facts that might emerge at some future stage, and to have prepared responses for any anticipated speculation or spin by other stakeholders.

So I was a surprised to read in the Boston Globe that a group of banks are claiming that 94 million accounts (more than twice the original estimate) were affected in the theft of personal data from TJ Maxx. That’s a staggering number, suggesting a much higher potential loss than previously estimated. It will no doubt generate a new wave of damaging publicity, despite the fact that the company seemed to have successfully drawn a line under the incident without suffering any serious impact on sales.

The key learning point is that, when in a crisis, avoid leaving room for future, sensational claims or speculation that might undermine your hard work in rebuilding your reputation. In particular, pay attention to the second rule of holes: if you’re in one, stop digging.