Don't Kill the Messenger! Dealing With Press in Cases of `Crisis' Can Be Vital for a CU's Image

MADISON, Wis. - It's the type of news most credit unions might not be so eager to talk about: a CEO's sudden "resignation," the discovery that an employee has been funneling money from member accounts or a credit union wanting to convert to a bank.

It's how credit unions respond when the press calls for more details that sets apart the novices from those that already have some sort of media response plan in place to handle unusual scenarios. Indeed, having a media response team in place is one proactive way credit unions can be prepared for the inevitable, according to PR for CUs-Public Relations Strategies for Credit Unions by Lucy Harr and Dick Radtke, published for the Credit Union Executives Society. That team can be head by the CEO or another top executive and could include staff from other departments such as legal, office management or marketing.

According to Harr and Radtke, there are five critical steps to responding to a crisis when dealing with the media. The first move is identifying the risk.

"Although that sounds obvious, there are still some credit union leaders who believe their credit union has no significant areas of risk, no need for any risk assessment, and no need to create any plans," the publication's authors said.

From there, the credit union should assign roles and discuss duties and then focus on developing loss prevention techniques; risk avoidance strategies; insurance review plans; specific audits of departments, managers and employees, and other prevention techniques, Harr and Radtke said. The fourth step is actually writing the crisis response plan, which could include putting in writing definitions of specific types of potential crises and creating steps to follow should they occur. Within this step, the credit union determines who will play what role to manage the crisis and keep the operation running. The final step in responding to a crisis is creating an incident review subcommittee to assess how the situation was handled and what lessons were learned to improve for any similar events in the future.

"Since it's next to impossible to predict when, where, or why a problem may hit the organization, the group should have everything in place beforehand," Harr and Radtke said. "It's difficult to do the work, but it's rewarding to see that the efforts at contingency planning will pay off in a pinch." Laying Media Groundwork

In 2004, $558 million Clearview Federal Credit Union underwent a number of organizational changes: a name change from US Airways Federal Credit Union, a switch to community charter, and the retirement of its longtime CEO Joseph Cirelli after 35 years of service. All of this occurred within a week's span that autumn. One of the trickiest parts was keeping the new name under wraps before the credit union had the chance to officially announce the moniker at a press conference. But in the end, the credit union took a proactive stance addressing every question asked about the litany of changes. Media and members were inundated with the facts behind the changes including the rarely-seen, but much-appreciated online press kit. Being prepared stemmed from mutual respect Clearview and the media had built over the years, said Christianne Gribben, assistant vice president of marketing.

"We see it as an ongoing relationship," Gribben said. "We provide helpful information to the media. We get the coverage and [reporters] don't have to go digging up information."

Knock-on-wood, Gribben said the credit union, which has a more than a 50-year tie to US Airways airline, has not had to deal with any major crisis that it could not handle. One scenario that came pretty close is the concerns that members had about the credit union's status during the period when US Airways, like many other airlines, battled financial woes including a Chapter 11 bankruptcy of which it has since emerged.

"We wanted to reassure members that their finances were in order. It was important for them to know that the credit union and the airline were separate," Gribben said.

Hypothetically speaking, in a time of unexpected crisis, Gribben said the marketing department would support senior management with the mission of "keeping the big picture in mind" and "protecting integrity at all times." It would also be important to assess the timing of a response and if the media would even care.

"Every situation is different," said Lisa Weber, Clearview Federal marketing manager. "We weigh the timing of it. Is it something we put in our member newsletter or release to the media."

Even having "a lousy plan is better than no plan at all," said Harr and Radtke. The key to success during a difficult moment "lies in never giving up and never giving in," they suggest.

"Better to put some plan into immediate action and follow it than to flail around with nothing to do and nowhere to go," the authors said.

Then there's the approach that even bad news can be good news when talking with reporters, offered Mike Duffy, president/CEO of $310 million Financial Center Credit Union.

"When we do have threats, we ask `where is the opportunity,'" Duffy said. "If something like a robbery occurs, which you have no control over, it can damage reputations and everything looks bad." But in this hypothetical situation, Duffy said this is a prime opportunity to tell the media about the credit union's safety and soundness plan in place and how members and staff that may have been involved in the robbery were taken care of after the unfortunate situation.

"We would want to get the message out first instead of waiting on [the media] to pick us apart," Duffy said. For those credit unions that are just leery of the press and try to avoid them at all costs, Duffy said he can understand some of their reluctance. "Quite often, with local media, they're looking to sell the negative," he suggested. "They will push and push for what is the selling point. People don't like to look at news that way." VyStar Credit Union recently found itself dealing with the media on a potentially damaging crisis. The credit union had been hit by a data breach that affected 10% of its 344,000 members. The credit union quickly informed the affected members about the data security breach, but not the media. Coincidentally, an affected member was a reporter of the local paper. The reporter ran with the story in a negative light in the eyes of VyStar CEO Terry West.

West said the reporter seemed to "want to sell papers that day" and sensationalized the story. West said the CU did not hide from the press, it had a team in place to answer questions and West himself spoke to reporters. West doesn't think it was the CU's job to contact the press about the story. "Our first concern was to let the members who were affected know," said West.

Because trade publications are different, Duffy said Financial Center CU sends out different news releases to them compared to local press. Credit unions should also consider having resources allocated to use a public relations firm if there is going to be a big announcement like a name change or converting to a bank. The bottom line is credit unions must have a plan and be diligent about carrying it out. "You have to be careful about what you're doing and how you're doing it," Duffy explained. "It's about structure. If we can't get it right, how the heck is the public going to get it?" -msamaad@cutimes.com