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A Lesson from General Motors

Thursday, July 13, 2017

The news media provides numerous examples of how leaders do in crisis situations. General Motor's testimony on Capitol Hill in early April of 2014 is one of many. This is not a criticism of GM, but a real-time lesson of how a leadership crisis can occur. Regardless of the strength of any leader, we all face risk in leadership. Read more about these leadership risks in my resource, The Enemies of Excellence .

Any leader who was watching CEO Mary Barra testify to Congress under the shadow of 13 deaths linked to GM's delayed recall of a failed ignition switch, was visibly cringing. Not that she did a poor job, but that hers was a very hard job to do.

“Our company’s reputation won’t be determined by the recall itself, but how we address the problem going forward," stated Barra in a letter to employees. GM learned the hard lesson that accountability for its mistake came 10 years too late in many people's eyes.

A leader's first lesson in leading through challenging times is never to turn a blind eye to the crisis. Though the truth may be ugly, or hard to navigate, it's always worse when ignored or concealed. The hot seat is a place where even the best of leaders can end up, but few are prepared for it. The dilemma is how to best address people's concerns while maintaining the integrity of an organization and its reputation.

Don't avoid reality.

A crisis never resolves itself. When a crisis is fresh, this is your chance to clear up rumors and respond with the facts before anyone else. Don't waste this precious window of opportunity as a leader to set the record straight.

Initiate first and respond with urgency.

Part of the reason GM faced the firestorm of media criticism is for the decade that passed before the faulty part on their cars was recalled. This error in judgment was time sensitive and presumably, swept under the rug until public outcry demanded a response. The unfortunate lesson is that you don't get time back. Show your urgency to remedy the situation or mistake. Taking immediate action will help to reinstate people's trust in you as a leader. Words become empty as long as the crisis lingers unattended.

Address your mistakes.

Transparency, not perfection, is what people expect in a crisis. Mistakes happen, and it's how the best companies transition through crisis that keeps them on top. Gather trusted counsel and create a crisis response plan. Write a communication brief, hold a press conference, send out a company memo, communicate clearly, and whatever you do, make it timely.

Appoint trustworthy leaders to help you make this transition.

Part of solving the problem means finding out how it happened. Place individuals you trust on a committee to investigate shortcomings and follow up with solutions that work. Maintain a clear and open line of communication about the crisis until the story takes a turn from the problem toward the solution.

See the light at the end of the tunnel.

A crisis doesn't remain a crisis forever. Improvements are made through lessons learned from past mistakes. Make this crisis count. Ask questions, strengthen weak areas, and surround yourself with those who care about moving your company forward. Leaders who aren't afraid to face what's happened can define what it means for the future.


To your leadership in times of crisis,

Coach Greg

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