Rather than communications which will be covered by many other speakers, I will focus more on business strategy during the current recession and how this impacts on communication and reputation. 

While I know the common term used is Crisis as an economist, I much prefer the correct economic term, recession.  A crisis last a short period of time. It ends, life and business returns to normal.

By contrast, a recession last longer, has greater impact and changes fundamentals, including the way we do business and the way we communicate.  The world has changed we should not imagine some return to business as usual in communication or in any other field. 

Only those who recognize this fact both working in house and in consultancies will be able to come through the other side of the recession to the upturn and be successful. Communications professionals recognized this and adapted strategy and messages to meet the new reality.  The emphasis now is on accountability for communications performance on attaining real business goals. And on real value for money.

From a corporate communications perspective a recession strips away the gloss and the spin and leaves the reality of business performance.  In a recession talk is cheap, cash is king and value for money is the new currency. Hype is out and substance is in.  As the famous quote from the US investment Guru Warren Buffets says

“Only when the tide goes out do you discover who's been swimming naked”
Warren Buffett

The recession is a tough time for businesses and some have been caught naked in the receding tide.  No more so than banks and bankers

In the financial market many banks, and indeed bankers as a group, have lost their most valuable assets.  And here I do not just talk of the reduction in the value of assets or the dramatic increase in non-performing loans and falling currency values. Here we can see where banks and many other businesses have lost possibly their most valuable asset ….Trust and of course with this their reputation.

In a recession what we measure first and foremost is our liquidity, not really an indicator which most people measure from a communications perspective. Yet I would bet that in the last 12 months it is the indicator that most PR company chiefs have been monitoring most closely. And this focus is the key to reputation management in recession.  It is a business’s ability to stay cash liquid that helps business protect reputation and prevent a recession becoming a crisis. Or your brand risks becoming another Lehman brothers

In a credit crunch, those who have money can continue in business and in the future prosper.  Those who do not have money are either sold, fail or rapidly lose value and have their reputations ruined in the process.

In terms of communications, at SCM the focus has been to provide calm and considered comment to the media on the impact of the recession on our business and our strategy for managing the business in current economic environment. Our approach was to have a clear business strategy which is essential to manage the real impact of recession, clear messaging based on that strategy, and clear leadership in from our CEO, Oleg Popov, in communicating this. This was then implemented by our excellent in-house corporate communications team.

What we have been saying has been simple and straight forward and reflects our business strategy in recession.

We focus in maintaining liquidity in our businesses, this is our top priority

Reduce cost to focus on essential expenditure to ensure we use our cash resources efficiently

The priority is to maintain employment in our businesses and where at all possible avoid lay-offs, good people are a valuable asset and a competitive advantage

Meet all payments in full and on time  for our corporate borrowing

Be Positive, recessions end and always create new opportunities, SCM  will come out of the period ready to take advantage of this

Since the recession spread across the globe, particularly after the spectacular fail of Lehman. SCM has consistently communicated the messages above. This has been done in speeches, presentations and interviews.  On a quarterly basis our CEO has given an interview or answered question from the media on our approach to the recession so that the messages were reinforced and where necessary updated.  I believe that this calm and considered approach has ensured that we managed our reputation through these stormy economic seas.

For communications professionals there is silver lining in the grey cloud of the recession

Increasingly, business is leaving behind expensive advertising and turning to cost effective and targeted Public Relations.  Corporates and brands both know that media is read, watched and trusted and as a real impact.  In a tough economic environment, I believe that PR can be the most effective force for protecting and managing a business’s most valuable assets…. Its  reputation

It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently"
Warren Buffett

I expect many CEO’s of banks and financial institutions, as well as those who in some cases bought their advice and over borrowed, wish that they had heed his advice. Thank you.