Crises in the mortgage industry come in all forms and sizes, from client complaints that go viral, to major cybersecurity breaches, government regulatory actions, sexual harassment issues, class-action or government lawsuits, or other incidents that impact a company, community or industry. Strategic public relations professionals have been dealing with these issues and more for decades.
But the challenges have intensified significantly in the past five years due to the continued evolution of social media culture, and the race by the news media and clickbaiters to be first to publish even if accuracy suffers. Instant, widespread communications can ruin a reputation within hours, even if the information is based on supposition, one-sided claims or incidents that haven’t been validated.
The charges go on Page 1 (print or digital) and on every social media channel. Any corrections run on the bottom of an inside page, if they run at all. Analyzing failed or derailed efforts shows the extreme dangers hidden along any successful path of managing a crisis. The list could fill a book.
Individually, not every land mine can be fatal. But one blast can set off another, making the goal of getting through the crisis unscathed either unlikely or impossible. The race increasingly favors the swift — and those who have planned for and understand these dangers. This leads to recommendations for preparing for any crisis and taking positive steps to manage all elements with alacrity when it happens.
When crisis issues arise, the best-prepared mortgage companies pull out a well-rehearsed plan and implement it quickly, confidently and successfully. If an organization isn’t ready with its own detailed strategic plan, panic can rule the day.
To plan now for the worst-case scenarios, convene an internal task force to identify the top risks. Address them in the plan. The forethought that goes into planning, regular rehearsals and updates will be key to the speed, clarity and quality of your responses, as well as the success of any mitigation efforts and the protection of your reputation for the long term.
A mortgage company needs to adhere to its core values. No, this isn’t a “Kumbaya” moment. Investing in the development of culture with strong corporate values is essential to the long-term success of any organization. The companies best prepared to weather a crisis are the ones that have already determined what they stand for and have provided ongoing evidence to support their position.
Studies over the past three decades have shown that intangible assets like reputation may provide companies with a more enduring source of competitive advantage than their pricing, range of product offerings, customer service, servicing qualities or technologies. Reputation speeds growth on the way up, and it protects against crisis or criticism should fortunes or finances reverse direction. But it can’t be hype. Institutions and organizations can’t simply claim to be leaders or top ranked for quality, technology or community commitment.
In his landmark book, “Reputation,” Charles Fombrun notes that companies develop winning reputations and protect them for the long term by not only doing things right but by doing the right things. These are potentially key differentiating factors in the mortgage industry, where everyone can sound alike in their marketing materials.
Having a corporate history of hype or muddled communications strategies can create frustration and distrust among current clients, future clients, key stakeholders and the media. Achieving a desired position and enduring reputation requires strategic investments in your image over time and ongoing proof of principle. Analyze where you have been on the hype meter — from awful to being a standard for fact-based communications. Proactively executing a strategic communication plan to accurately position and depict your company with the media is a valuable investment. Evolve from previous issues of hype to build authentic, long-term relationships and understanding of the company with all stakeholders.
CEOs can have outsized egos and think of themselves as natural media stars. They may refuse to rehearse or follow a script or plan. They often ignore the gravity of the situation and think they can charm and spin their way out of the morass. Some bully their staff members into being afraid to provide authentic, sincere counsel.
This land mine calls for honesty and the ability to call out when “the emperor is wearing no clothes,” maybe through the help of outside experts. Make sure the CEO’s ego isn’t getting in the way of the company taking the necessary actions to strategically manage an issue or clean up a mess.
Then there’s “attorneyitis.” This land mine occurs when otherwise good messages that the CEO and crisis team have approved are handed off for legal review and come back bruised, bloated and infected with the deadly disclaimer virus. The test? Read a sentence out loud, and if everyone’s eyes glaze over like you were reading from C-SPAN transcripts or they laugh so hard they herniate, start over. Clear, concise communications in a human voice are essential.
While turf wars and a lack of corporate alignment have broader ramifications in preventing an organization from achieving its business and marketing goals, these problems are exacerbated and accelerated in a crisis. Good organizations exhibit grace under pressure through positive, consistent communications. For the unaligned and contentious, disaster looms. Factual inconsistencies and delays in responding can create a perception that there’s something to hide, erode trust and invite deeper probing. The media will exploit this by interviewing different sources, looking for contradictions and exposing the worst truths.
Although the specter of disaster is huge when a crisis breaks, few crises are fatal to an organization or individual.
Time is of the essence when reputations are at stake. When dealing with quick-moving news cycles and viral eruptions across social media channels, a well-rehearsed crisis plan and existing messaging strategies can help mortgage companies provide solid facts and meaningful quotes at warp speed to ensure more balanced coverage and avoid the regrettable refrain, “The company was unavailable for comment.” Getting back to the media with even a short statement, such as, “We are checking all the facts and will get back to you as soon as we have an answer,” can help mitigate pending disaster.
“No comment” is a nuclear land mine that should be avoided at all costs. It can be perceived as if you’re saying, “Guilty as charged.” Armageddon may seem imminent, but salvaging a small part of your reputation during difficult times can provide a starting point for building a new one in the future. There is always a better answer than no comment.
Too often, messages during crises are rooted in jargon. This isn’t necessarily fatal, but it can be annoying and a potential roadblock to getting your compelling messages through the clutter during a crisis. Speaking in a sincere, human voice will help build bridges with the media and the target audiences on the other side of this filter.
Be careful with acronyms or alphabet soup, especially if dealing with media not familiar with the mortgage industry. Do quick research on the reporters and help them tell a good story.
A trick learned from many challenges in breaking through with the media is to imagine the perfect headline for the crisis. What would the headline say and where would it appear? Then work backward from perfection, and align all plans, themes, evidence and tactics to bring that headline and impression to life.
What if there is a questionable history? It’s possible that evidence exists — against the company, the CEO, an employee, or even its products or services — of an illegal action, questionable lending practices, discrimination, previous governmental actions, data breaches or other transgressions. The media will find it using proven investigative skills.
The crisis-management team needs access to all the potential issues from the past. When the crisis first erupts, consider bringing in support from an external expert to provide independent analysis and strategic counsel. This can help to avoid some of the other land mines, such as the CEO’s ego.
A public relations team can analyze the crisis in context and any potential new issues to address before determining the proper response, including apologizing for previous shortcomings and outlining specific steps to take in righting any wrongs. A positive approach to dealing candidly and honestly with all issues can be a major contributor to saving your reputation and building company morale for the long term.
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Although the specter of disaster is huge when a crisis breaks, few crises are fatal to an organization or individual. CEOs reinvent themselves regularly, particularly in industries with high failure rates (such as technology, biotechnology or internet services). Companies go through constant change and deal with major public issues and market turmoil while continuing to move forward.
The mortgage lending industry roils with consolidations, government actions and revolving doors in the leadership suite, but good times can prevail. The path to building and maintaining a strong reputation becomes much easier with a continuous investment in reinforcing strong core values, proactive crisis planning and avoiding potential land mines when the next crisis erupts. ●