BulletProofBlog the blog on crisis communications

Each Monday, Bulletproof Blog features exclusive interviews with thought leaders on issues of critical importance to companies and countries. This week, with Chrysler' s recent announcement that it will file for bankruptcy protection and other companies likely to follow suit as the current economic crisis continues, we interview Cyrus Pardiwala, a leader of the PricewaterhouseCoopers U.S. Restructuring & Recovery Services group.

Mr. Pardiwala has been with Pricewaterhouse Coopers for more than 17 years. As an internationally recognized expert on bankruptcy communications and its essential role in driving a comeback, Mr. Pardiwala shared his insights with Bulletproof:

What should companies confronting bankruptcy be saying to cement the perception that a comeback is imminent?

Cyrus Pardiwala: It is important to have a message out there that is credible and consistent both internally and externally. In this day and age, we work under the assumption that spin doesn' t work - stakeholders see through obfuscation and doublespeak.

Likewise, you can' t be disseminating different messages to different audiences. You can always tailor messages to particular stakeholders, but the messages must not be contradictory.

And, perhaps most important, your messages have to focus on the actions taken to give comfort to the various stakeholders who need to know that the process is under control. There has to be a plan and the aspects of that plan need to be clear as day. It is my experience that when distressed companies spend too much time trying to explain what happened or deflect responsibility, it doesn' t help. It only keeps the emphasis on the issues that led to the prospect of bankruptcy in the first place.

What are the dangers of failing to effectively communicate a credible and consistent message?

Cyrus Pardiwala: The most immediate danger is a far more difficult process for getting a plan of reorganization approved. If a company fails to get the message out or the message gets garbled, it creates a sense of uncertainty or lack of confidence that results in a much more difficult negotiation with all the various parties [with whom] the company needs to deal in getting a plan approved.

Your lenders, your creditors, your shareholders, your employees, your customers, and even your competition are all watching every move you make. With the exception of your competition, you will be depending upon a partnership of sorts with each of these audiences to get back on your feet. If you give them reason to believe in a comeback, you' ll find them much more amenable to your position. If you don' t, you create adversaries at a time when working together is of the utmost importance.

If I were the communications director of a company filing for bankruptcy, what would be the three most important things to remember moving forward?

Cyrus Pardiwala: First, be in control of the messaging. Get out in front of the story and stay in the lead.

Second, focus on the consistency and the credibility of your messaging.

And third, make the reorganization plan and its execution the central theme of the campaign.

For more insight from Cyrus and his team send an e-mail to cyrus.pardiwala@us.pwc.com.