Mark Begor* inherited a big mess. The Equifax Crisis.
Almost three years ago the credit bureau suffered a huge cyber breach. Critical information about more than 145 million consumers was put at risk. Originally discovered in July 2017, it was not made public until September 7th of that year. It’s been described by the FBI as the largest state-sponsored hack in history.
Just 19 days after Equifax initially revealed the breach, its board announced “the abrupt retirement of CEO and chairman Richard Smith**.”
Seven months later, Begor, a longtime GE executive, was hired as the new CEO.
Most recently, the Justice Department indicted four members of China’s People’s Liberation Army, accusing them of this massive criminal intrusion.
Any crisis for a business is unwelcome. Media questions can be very uncomfortable. But they need to be addressed. Immediately after the DOJ indictments were announced, Begor was accessible, and facing tough questions:
First, the good points:
Begor’s immediate availability to the media was smart. Fires are put out more easily with quick action.
He stopped immediately when the anchor interrupted him. That’s your best option, instead of trying to compete and simply end up talking over each other. Important messages usually are unheard in that situation.
He had one major message point he wanted to get out: Equifax is investing heavily in new tech and security. He got that in twice.
What he should improve on:
Begor’s initial body language was curious. The look on his face with his lips tightly pursed together. Nerves? Or Irritation?
When the anchor asked his second question as a consumer who has no choice about being on the Equifax hard drives, Begor’s answer was somewhat defensive, saying the credit bureaus serve an important role. He should’ve shown more empathy for peoples’ concerns. That would have humanized both he and Equifax.
The best preparation for a crisis is before one erupts. Get training and regularly practice your response on realistic possible crises. Your goal is to get things back to normal. Quickly!
The cover-up is worse than the “crime.” In other words, when a crisis erupts, reveal it as soon as you can and start telling your various audiences what you are doing to solve the issues. Communicating a positive process and your progress is important to your reputation and future of your business.
* Begor worked for General Electric for 35 years. He subsequently worked for Warburg Pincus. He has been serving as the chief executive officer of Equifax since April 16, 2018.
**Smith worked at General Electric for two decades. He served as the chairman and CEO of Equifax from 2005 to 2017, when he retired in the wake of the data breach of approximately 145.5 million customers. Because Smith retired instead of getting fired, Fortune reported he was expected to receive $90 million, including performance-based unvested stocks and $18.5 in retirement benefits, according to Fortune.
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