Get All Access for $5/mo

Bouncing Back: Taking Care of Your Team After a Company Crisis Your employees depend on you to lead them through a challenging time -- here's how to lead effectively following a company-wide red alert.

By Bob La Loggia

Opinions expressed by Entrepreneur contributors are their own.

Colin Anderson | Getty Images

Businesses are made up of imperfect human beings (at least for the time being). And, as humans, we sometimes make mistakes. Most snafus consist of something minor -- you forget to send your team a meeting agenda and everyone shows up unprepared, or an email typo causes an embarrassing situation with a new colleague.

Then there are the instances when small mistakes cause huge problems for a business. Take Amazon Web Services, for example, whose massive outage earlier this year was caused by nothing other than an honest mistake on a programmer's part. No biggie, right? Wrong: One incorrect command caused internet chaos, amounting to more than $300 million total in lost revenue.

Thankfully, most small business owners will never face an incident of this magnitude. But only a lucky few of business owners will never encounter some type of company crisis that takes a major toll on their team. When those crises occur, how should we, as leaders, respond?

A beast of a problem

Recently, I asked myself this question with a greater-than-normal sense of urgency as my company hit its own speed bump. Some months before, we had implemented a software update that, well, went wrong.

Make that "horribly" wrong beccause, while we typically release product updates once or twice a month, and most go off without anything more than a hiccup (which can be addressed right away), this particular update was different.

Let's just say it didn't go exactly as planned.

The release -- one of the biggest we'd ever done -- included changes to the core of our system. And although we had gone through the normal process of testing and sign-off, we realized in retrospect that it was too large a release to be handled in our typical manner.

As a result, many of our clients were unable to access parts of the system, and some components of our application didn't work properly. The result? Before we could even fix the issues, some clients began looking elsewhere for a replacement.

With 100 employees, our business was, and is, large enough and financially strong enough to withstand an elevated churn for a period of time. Unfortunately, though, an issue like this can put other small companies out of business. Not to mention the damage wrought by client and employee concerns about a company's stability. Such concerns have the potential to significantly impact a business over the long haul.

Simply put, businesses faced with a serious incident need to act quickly and carefully to avoid a tense situation turning chaotic.

Related: Taking the Bite Out of a Workplace Crisis

But as awful as situations like these might be, they also provide unique opportunities to build trust -- not only with your clients, but also your team. Going through a traumatic situation with others brings you closer together and helps form powerful bonds. It also builds strength, character and confidence. As difficult as it is to tackle a tough situation, the company and team involved can become more resilient than ever. Indeed, many businesses not only recover from bad situations but go on to be even more successful in the future.

Tips on making it through

Here are some ways we got our own team through that product update gone wrong. These are tips that any small business faced with a red-alert issue can put into practice:

1. Be more observant than ever. Sometimes, in a work environment, it's easy to miss subtle cues about how people are feeling. After a difficult event, you have to be hyper-aware, and you have to take action. If you see that employees seem stressed out, tell them to go home or give them the next day off. For many, that willingness to reach out is tough: A Harris Poll survey indicated that a whopping 69 percent of managers surveyed said they felt uncomfortable communicating with employees; but your team will appreciate that you cared enough to address the problem.

Part of being observant is also knowing when to jump in and help. When my company faced its crisis, staff from other departments pitched in to take calls from clients when the support team became overwhelmed. Our entire team operated with a sense of urgency and helpfulness. We never pointed fingers. We stuck together and focused on the job at hand.

Related: Multiply the Trust Factor Inside Your Organization

2. Don't sugarcoat what everyone went through. Be honest about the pain that your team has suffered as a result of the incident, but also be hopeful about the future. When things began to settle down at my company, it was clear that nerves were frayed and our staff felt beaten up. I remember walking around the office and being taken aback by how exhausted everyone looked. The event really took a mental toll on my team.

What got us through our situation and allowed us to move on was the same thing anyone would do for a friend going through a tough time: We let people talk about their thoughts and feelings; we were supportive and helped one other as much as we could.

Not only is this the right thing to do from a human relations standpoint, but studies show that truly listening to your staff helps with retention. Plus, employees who feel that their voices are heard are nearly five times more likely to feel empowered to do their best work.

3. Refocus on company values, goals and projects as quickly as you can. When a natural disaster occurs, we commonly hear leaders talking about getting back to normalcy. It's the same with work issues.

When Samsung experienced its now infamous exploding battery debacle on its Galaxy Note 7, the company not only had to deal with the outcry from customers and the media, it had to regain the confidence of its staff. The company did this by refocusing on its business goals and values. In doing so, the organization created a new inspection test and an eight-point analysis. The point was to ensure that in the future this type of flaw would be caught during the testing phase, and not by customers after the product went live.

At our company, we simply resumed business life as usual. We went back to our daily stand-ups, held our regular all-hands meetings again and got back to working normal hours. We didn't deny what had happened. As a matter of fact, we continued to talk about it and adjust processes to prevent it from happening again. But we didn't dwell on it.

Related: 8 Ways to Stay Calm During a Crisis

When a major issue occurs at your company, it's a true test of leadership. Will you kick into action, or will you allow the stress of the situation to get the best of you? The bottom line is this: A company crisis is when your employees need you most. They need to know that you care, that you truly believe that everything will be okay and that they can depend on you.

Bob La Loggia

Founder and CEO, AppointmentPlus

Bob La Loggia is the founder and CEO of AppointmentPlus, a fast-growing SaaS business specializing in software for online appointment scheduling across industries. His company has won a number of awards, including CareerBuilder’s Best Places to Work award. La Loggia is a serial entrepreneur who’s passionate about his business and helping Arizona develop a world-class startup ecosystem.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Business Solutions

Increase Productivity with This Microsoft 365 Subscription, Now $25 Off

It can make the entrepreneur life a lot easier.

Business News

Apple Pay Later Is Ending. Here's What's Taking Its Place.

The program was available for less than a year.


This Artist Answered a Businessman's 'Powerful' Question — Then His Work Became 'the Poster Child for Juneteenth': 'Your Network Really Becomes Your Net Worth'

Reginald Adams was the executive director of a Houston-based art museum for more than a decade before he decided to launch his own public art and design firm.


Harvard Business School Professor Says 65% of Startups Fail for One Reason. Here's How to Avoid It.

Team alignment isn't nice to have -- it's critical for running a successful business.

Business News

Here's What Companies Are Open and Closed on Juneteenth 2024

Since it became a holiday in 2021, Juneteenth has been recognized by some major corporations as a paid day off.

Growing a Business

I Hit $100 Million in Annual Revenue by Being More Transparent — Here Are the 3 Strategies That Helped Me Succeed

Three road-tested ways to be more transparent and build relationships that can transform your business — without leaving you feeling nightmarishly over-exposed.