The Art of Communicating Risk

 

We are very good at communicating bad news, absorb it and move on. But we struggle when we don't know how bad the news is. In a crisis, companies often have to deal with potentially bad news. 

Communicating this uncertainty is one of the biggest challenges faced. Risk communication is even more important during crises. How long is it likely to last? What are the long term economic, social and cultural consequences?

Communication is an important part of corporate and organisational management. The unknown consequences of risk make it difficult to assess its impact and communicate effectively. It has major consequences for both the individual and organisations. The tech sector has suffered the most at the hands of its customers, users and regulators because they have struggled to communicate about what they are doing to correct it and its effects on their users in a transparent way.

Companies often err too far in either direction. When they inform their users of every potential risk it causes information overload and therefore notification fatigue. Users tune out after a few times and companies lose the opportunity to firm up their trust relationship with users. 

When they wait too long, users may interpret is as incompetence or hiding facts to protect the company and thereby harming the user interests.

Also, the users receive much such information from various sources leading to information fatigue and ultimately affecting the trust level of the company.

The basic challenge is one's desire for certainty and closure. Users can process uncertainty if they are given some basic facts and tools for decision making. 

• A common template could be to focus attention on information that would directly inform decision-making uncertainty. 
• Use numbers instead of adjectives like rare, common etc., 
• Address the risk and benefits. 
• Compare to known alternatives. 
• Emphasise the quality of information available to date. 

But many times it doesn't happen this way as the people in charge of communications believe that users cannot deal reasonably with uncertainty and risk. Companies face this dilemma every day about whether and how to communicate less severe incidents and it is easy to convey the same to users in a narrow ay instead of understanding that it is a collective problem which if not done properly can enhance the disbelief among the users.

They can adopt the following points.

• Stop improvising Firms can commit to inform the customer in systematic, predictable ways. A standard framework would provide a template for the next incident. It would set expectations among users for meaningful communications and help reduce the risk fluency and damage inflicted by people who prey on user anxiety about risk. 
• Change the metrics or success and measure results Primary goal should be to equip users with the information they need to equip themselves with uncertainty and manage the risk. The long term goals should be to increase the level of trust and reduce the risks where possible. Companies need to demonstrate what they are doing is working by creating yardsticks that measure their effectiveness.
• Design for risk communication from the beginning The need for communication of uncertainty should be built into the design stage itself of any product development and this would lead to a different approach in design and innovation in user experience and user experience. this would result in feedback loops built into products at the design stage itself, telling companies if they are improving the user ability to make informed choices. 

Users prefer certainty and closure and establishing this practice of transparency and improving the trust factor among the users.

The Art of Communicating Risk

by Ann Cleaveland, Jessica Cussins Newman and Steven Weber

HBR 2020/09