| Sometimes crises are "big deals." Sometimes they're | | | | entirely at the franchiser's expense. He had then |
| situations that can crop up in any industry, but fit the | | | | twisted the facts about business practices and thrown |
| Webster's Collegiate dictionary definition of crisis as | | | | in some facts -- that board members HAD been |
| "an unstable or crucial time or state of affairs whose | | | | involved in past lawsuits. What he didn't say was that |
| outcome will make a decisive difference for better or | | | | those lawsuits had not involved the board members |
| worse." If mishandled, the situation below, modified to | | | | while they were with the current franchiser and all had |
| preserve confidentiality, COULD have become a "big | | | | been minor civil cases resulting, at worst, in very |
| deal." | | | | low-cost settlements. In other words, "routine business |
| Situation | | | | experiences." |
| A franchiser suddenly started getting calls from | | | | However, damage had been done. The disgruntled |
| concerned franchisees. They had been contacted by | | | | franchisee had already contacted approximately one |
| a relatively new franchisee who had pointed out a | | | | dozen of his peers and the company knew the rumor |
| number of things he felt were illegal or unethical about | | | | mill would spread the word to many others. |
| the franchiser's business practices. He had also alleged | | | | The in-house counsel and PR/crisis management |
| that some of the franchiser's board of directors had | | | | consultant put their heads together and, ultimately, what |
| been involved in multiple past lawsuits -- the implication | | | | resulted was: |
| being that they were previously accused of | | | | The disgruntled franchisee was asked to write a letter |
| wrongdoing and shouldn't be trusted. | | | | to all whom he had contacted, one actually drafted by |
| Initial Management Reaction | | | | legal and PR counsel, apologizing for causing alarm and |
| Management, appropriately, told the concerned callers | | | | correcting the facts. In return, the company offered a |
| that they could understand how such information might | | | | more-than-generous method by which the franchisee |
| upset them and asked for a little time to check out | | | | could get out of his deal. This avoided a lawsuit against |
| what was being said, and by whom, before | | | | the franchisee that would have been negative PR for |
| responding. They wisely did not immediately deny | | | | the company, even if they "won" in court. |
| allegations, knowing that they were hearing | | | | His letter was accompanied by one from the |
| second-hand information, and that there was some | | | | company, offering to answer any questions the |
| limited truth regarding the issue of past lawsuits. | | | | recipients might have and communicating, in essence, |
| Crisis Management | | | | that they were forgiving of the disgruntled franchisee's |
| Response, from that point on, proceeded on two | | | | trespasses. |
| concurrent fronts: legal and PR. The franchiser's | | | | The same letter was kept on standby for use with |
| in-house counsel contacted the franchisee who had | | | | any other franchisees who heard via the rumor-mill. |
| made the allegations and found that the franchisee | | | | A contingency statement was written for use with |
| was worried that he'd committed to his franchise too | | | | trade and franchise media if they got wind of the |
| fast and, actually, was looking for a way out. His initial | | | | rumors. |
| inquiries to the franchiser on this subject had been | | | | The situation calmed and has not returned to haunt the |
| rebuffed simply because he was asking to get out | | | | franchiser. |