The importance of the appropriate response cannot be understated as both over and under-reactions can negatively impact the company. In the former, if the company goes into full crisis management and communication mode to be ahead of the incident, the company may inadvertently create a crisis where one was not in the making. In the case of the latter, if the company under-reacts and is slow in responding to an incident that eventually becomes a crisis, the company risks being put on the defensive. This is a disadvantaged position as the company's ability to protect its image and reputation will be then greatly diminished (See Diagram 1).
My advise to clients is to issue a scaled response acknowledging and providing factual information about the incident. This is because a scaled response will allow the company to hedge itself against the negative outcomes of Quadrant B and C. Let me explain (See Diagram 2):
Quadrant A. In this scenario, the PR Professional had correctly identified the incident as an incident and the company responded appropriately. Here, a mere statement of fact will not change the nature of the incident and turn it into a crisis. On the contrary, in the perfect information environment (where nothing will remain hidden forever), issuing a scaled response will ensure that the company's side of the story is told.
Quadrant D. In this scenario, the PR Professional once again correctly identified the crisis as a crisis and the company responded appropriately. The scaled response issued by the company will then form the “holding line” and the statement will also give the company the information initiative while concurrently establishing itself as primary source of information on the developing crisis. This response will once again position the company to deal effectively with the crisis.
Quadrant B. In this scenario, the PR Professional wrongly assessed the crisis as an incident and the company failed to act. In this scenario, issuing a scaled response will effectively pre-empt opposing stakeholders from fanning the crisis by accusing the company of having something to hide. Once again, a scaled response will perform the role of a "holding line" allowing the company time to react and deal with the crisis.
Quadrant C. In this final scenario, the PR Professional once again wrongly assesses an incident as a crisis. Similar to Scenario A, a mere statement of fact will not change the nature of the incident and turn it into a crisis and a scaled response will ensure that the company's side of the story is told.