Another Monday morning: The sun’s shining, the investors are happy, and the entire office seems to be in a perfect mood. You can tell it’s going to be a great week. Or so you thought until you got that call.
You know, the one from your most profitable customer says, “Yeah, we’re not going to renew our contract at the end of the month. Thanks for the last five years, though. Peace.”
The news hits like a bombshell, and your head’s still reeling when you realize that. As a leader, you have to do something about this. Moreover, you have to be the one that breaks the bad news to your team.
There’s nothing worse than having to drop bad news on the people you’re responsible for. But here’s a wake-up call: As a leader, navigating bad news is your job, responsibility, and privilege.
Your team chose you as much as you chose them, and this is your opportunity to prove to them they made a good decision. If you don’t mess it up.
Seriously, Don’t Mess it up
There’s only one thing worse than bad news: Bad news delivered badly.
I always see it in inexperienced leaders: They get the news and immediately think, “Okay, how can I make sure nobody knows about this?”
It’s a symptom of imposter syndrome. Suddenly, all your time and energy goes into hiding the problem rather than solving it, but guess what? Your team always finds out sooner or later, and in the worst possible way: By uncovering something you were trying to hide.
And just like that, your credibility as a leader is compromised. Now, not only do you have a crisis to navigate, but you have to navigate it without the trust and faith of your team. And spoiler alert: It’s probably not gonna work. Your team’s too divided to survive.
How to Break Bad News to Your Team
Alright, that’s the wrong way to break bad news. Thankfully, there’s a better way. It just takes a bit of finesse and patience. I recommend breaking the process down into three days:
- Keep the news to yourself on the first day and focus on managing your emotional response.
- On the second day, research the problem, gather data, and ask advisors for help.
- On the third day, call a meeting and break the news to your team.
Let’s take a closer look at each of the three days.
Day 1: Getting Perspective
First things first: When you get bad news, it will probably sound like the end of the world. It’s not unless you treat it that way.
Because here’s the thing: If you, as your team’s fearless leader, claim the sky is falling, people will believe you. They will buy into your fear and helplessness, which doesn’t help anyone.
So pause, take a minute, and breathe. Don’t jump to conclusions, solutions, or decisions; not yet. Your number one priority after getting bad news must be managing your emotional household before you worry about anyone or anything else.
Before taking further action, I recommend completing two exercises: The Worst Case Scenario Planner and The Five Why’s. Let’s take a quick look at each.
The Worst Case Scenario Planner
If the present crisis feels like the end of the world, you lack perspective. The truth is, even the worst-case scenario probably isn’t all that bad.
You can prove this theory by mentally playing out the crisis until its final consequence. For example:
- The bad news: Our biggest customer just canceled.
- Okay, I acknowledge and accept that. What happens next?
- Well, we’re going to struggle financially this year.
- Okay, I acknowledge and accept that. What happens next?
- We’re going to have to report this to the board. In the coming quarter, we’ll probably be criticized and under a lot more pressure.
- Okay, I acknowledge and accept that. What happens next?
- We’re going to have to work together as a team, or we’ll have trouble raising the next round of funding.
- Okay, I acknowledge and accept that. What happens next?
You get the idea: Keep playing this out until you reach the final consequence. Do this long enough, and you’ll usually come to one conclusion: It isn’t final, it isn’t consequential, and it certainly isn’t the end of the world.
Even if the final consequence is, “And then the company dies,” that’s still not the end of the road. You already have a great team, so use it to build something new. Play any crisis out over a long enough period, and the answer is always the same: Everything will be fine.
The Five Why’s
We’ve discussed The Five Whys before so I won’t spend too much time on them here. Instead, let me give you a quick overview: The Five Whys help you understand the root cause of a problem, and the process is pretty self-explanatory: Ask “Why?” until you uncover what caused the crisis. For example:
- The bad news: We lost our biggest customer.
- Why?
- Because we failed to provide them with the support they needed.
- Why?
- Because we didn’t have the support team to meet their needs.
- Why?
Again, you get the idea: Keep asking “Why?” until you can’t dig any deeper and find the cause of the crisis. Only once you truly understand the problem can you start developing a solution.
Speaking of which …
Day 2: Finding Answers
Alright, you’ve spent the last 24 hours processing the news and should be more stable emotionally. Even so, you’re still not ready to tell your team the news.
Before you call a meeting, spend a day gathering data, getting advice, and identifying potential solutions to the problem. Depending on the severity of the crisis, you can find help from several sources. For example:
- Your co-founders
- Your peers
- Your advisory board
- Your legal counsel
- Your mentors
Someone, somewhere, has experience with whatever problem you’re facing. Find them, talk to them, and develop an action plan.
You don’t need all the answers, but by the end of the second day, you should at least have a few proposed solutions. Then get some rest. You’re going to need it for tomorrow.
Day 3: Breaking the News
On the third day, after you’ve had a chance to process the information, find help, and identify potential solutions, it’s time to let the cat out of the bag. You’re no longer serving anyone, keeping the news to yourself.
Here’s the five-step process I use to turn an undeniably unpleasant situation into a smooth and productive experience as possible.
Step 1: Drop the Bomb
Successfully delivering bad news to your team is an art. Luckily, it can be easily replicated with the right formula. Here are a few tips to start your meeting off right.
Lead with the Bad News.
The bad news is, by nature, bad. Don’t try to disguise it as anything else.
If it’s a big deal, don’t pretend it isn’t. If you’re worried, don’t pretend you’re not. People pick up on incongruencies, and your dishonesty will compromise their trust in you as a leader when they need it most.
Just be straight with people and kick off the meeting with the unfiltered bad news. Tell them what happened, what it means, and how it will affect them. For example:
Take Ownership
As a leader, the buck stops with you. Regardless of who may have been involved in the screw-up, you need to be the one who takes ownership and responsibility. For example:
Sure, Bob may have actually failed to give the customer the support they needed. But you’re the one who put Bob in that position. You’re the one who failed to follow up and follow through.
Summarize Your Journey
Finally, give your team a quick summary of the journey you’ve been on so far. Tell them when you learned about this, how you reacted, the research you’ve done, and the lessons you’ve learned.
But keep it short. People aren’t able to take in three day’s worth of research. For example:
Step 2: Help Your Team Process
At this point, it’s usually tempting to try to ease the tension and fear by immediately implementing your proposed solutions. Don’t.
Just like you needed time to process the news, so does your team; give them the freedom to feel angry, scared, frustrated, or whatever else they need to feel. Let them ask questions, throw blame, and point fingers. It may not be pretty, but it’s necessary.
Before they can think productively about the crisis, people need the opportunity to feel whatever they're feeling. If necessary, break people out of shocked silence with specific questions like, “What are you feeling right now?”
Once you’ve got them talking, let them talk. Only step in to answer questions or steer the conversation back on topic.
Step 3: Present Your Solutions
Even after processing, most of your team will probably still be reeling from the news. As a result, they will look to you for answers and guidance.
This is when you want to introduce your solutions. Remember: You might have 15 different ideas, but you don’t want to overwhelm your team. Instead, focus on the top three, then ask for feedback. For example:
Note: Don’t worry if you don’t have it all figured out yet. Even a rough outline will give your people hope and a goal to work toward.
Step 4: Take Immediate Action
Once your team has decided on a plan of attack, identify the first step of that solution. This should be an action item that can be tackled immediately—not tomorrow, next week, or next month—but today, right now, in the meeting.
Here’s why immediate action is so important: There will be a lot of uncertainty, anxiety, fear, and nervous energy in that room. As a leader, you have the power and obligation to transmute that negative energy into something productive. And once you’ve got your people actively working on something, you’ll notice an immediate shift in their mental and emotional states.
Here’s a short example of what this might look like: “We can’t undo what’s done, but we can make sure it doesn’t happen again. Let’s look at all our current customers with a total value of $10,000 or more. If our success managers haven’t contacted any of them in the last 90 days, let’s make sure we check in with them.”
Step 5: Remind Your Team Who They are and What They’ve Done
Even after all this, your team’s probably still feeling pretty scared and discouraged. Don’t let them leave the room that way: Remind them that this problem isn’t bigger than them by closing with a strong, encouraging, empowering call to action. For example:
The meeting started with a slap in the face, so it ended with a pat on the back.
Lead the Charge
As a leader, “Bearer of Bad News” is part of your job description. But don’t forget: Breaking bad news is just the beginning. Now, you have to actually fix things.
And that’s where my final piece of advice comes in: In times of crisis, you don’t get the luxury of leading from an office chair. You need to be on the front lines, with your team, leading the charge and taking the hits.
- If someone needs to take public responsibility, it should be you.
- If someone needs to write a painful press release, it should be you.
- If someone needs to host a Q&A with your customers, it should be you.
Find the most difficult, most painful part of the solution and take full responsibility for it. That’s what it means to lead from the front.
No one said it would be easy, but we both know you didn’t get where you are by taking the easy route, so get back out there and crush it.
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Too busy to read? Watch this video to learn how to deliver bad news to your team.
