Voice of Experience: Crisis-Management Lessons from Wendy's

Denny Lynch shares what he learned from Wendy's recent high-profile crises.

By Mary Boltz Chapman, Editor-in-Chief -- Chain Leader, 7/30/2008 12:43:00 PM

Denny Lynch has learned a lot about crisis management in his 28 years at Wendy’s, some of it the hard way. There was the well-publicized 2005 incident of a woman finding part of a finger in a bowl of chili in a San Jose, Calif., restaurant, which turned out to be a case of fraud. And this spring, a random shooting in a West Palm Beach, Fla., Wendy’s put the team back in the hot seat. Lynch, senior vice president of communications and frequent company spokesman, tells Chain Leader in his own words about lessons learned from such experiences.

The key to crisis management

If it’s not important to senior management, it will not be important to middle management or line management at all.

Gunman walks into a Wendy’s at around 12:10, goes to the restroom, comes out and starts shooting. No provocation, no motive, no reason why, just starts shooting. By 12:20, it’s on cable news. That was a real crisis, nobody’s going to question that, but that’s how instant it was. If you don’t have senior management’s commitment to the importance of crisis-management systems, you are going to be woefully unprepared.

The ability of that restaurant to survive a crisis, meaning it will remain open, sometimes weighs on the ability to manage the crisis situation in the first couple of hours.

We call it a phone tree. We tell the managers, your first priority is the safety of your employees and customers, so do what you have to do to protect them. Lock the store if you have to. Call 911. And then call your supervisor. If your supervisor isn’t available, call their supervisor. Keep calling until you get a human being. Then your supervisor calls up. Keep calling up until the regional management or district management or corporate office, until they reach the right people who need to be addressing the situation.

The phone tree gets updated, laminated and sent once a quarter. Once a quarter you get a reminder that you have a crisis-management team.

It is a full day workshop where we teach them the management philosophies surrounding crisis management. And I drop a crisis on them, give them about two pieces of information—maybe not correct—and I make them take action on them. Then we go through and we solve the crisis.

It’s huge because as a crisis evolves, you only get fragments of information. In West Palm Beach, the first thing I heard was, “Four shots fired at Wendy’s.” I didn’t know if I heard four shot, or four shots. There’s a big difference. Was it employees, or was it customers? Is the shooter in the store? You’re chasing all kinds of information; some is accurate, some of it is not accurate. But you have to make decisions based on the information you’re given. You don’t have the luxury of saying, “Let’s wait an hour and see what happens.”

We will have the basic holding statement created to say, “This is all we can tell you. Police are on the site. They are conducting an investigation.”

You really can’t think of everything. Each one of these crises has its own makeup. What we teach is philosophy and approach. What do we need to do from an operations standpoint? What do we need to do from a people standpoint? What do we need to do from a marketing standpoint? There’s product in the store, and is the store going to close? Is this the day that I get supplies delivered to the store?

Think, how would it affect my business? What do I need to do? The ops people already know they need to think about these things, and marketing is thinking about these other things. Team leaders, the most experienced people that we have, worry about all 50 things.

For West Palm Beach, within 10 minutes, I was sending people from Tampa and Atlanta. Because you got to have bodies on the ground.

Who’s on the team? QA, supply chain, ops. We have an issues management group who is monitoring these things.

For the tomato issue, it didn’t make a difference what the detail was, we have an approach set up if there is a recall of products or a shortage of products, regardless if it is our supply chain or across the country. We have that protocol set up.

We can run a team leader out of the corporate office, we need a key player in a regional office, and we need a key player on the ground. We’re protecting a national brand. We have to take these steps with franchisees as well as company stores.

There is a tendency that we always want to be at ground zero. You have to manage the crisis, but can I afford three hours on a plane? You have to be where you’re most effective. If you’re working with four departments in the corporate office, you need someone there.

How are you going to reach these stores when it’s going to be on CNN in a few hours? We have an automated telephone system that sends a message to all our restaurants. With the tomatoes: “Go to your computer, download a sign that we have online.”

The voicemail is tested once a quarter, and each store has to call in to confirm. If a crisis occurs, we have confidence that a system is in place.

We in management must recognize the emotion that is at the site. We are human beings, and we have to treat each other as human beings. And the emotion at the site is dramatic. Consequently, we might not get the correct information from our own workers on site because they are dealing with the emotion. So I always look to verify. Are any employees hurt? “No.” Have you accounted for all the employees? “No.” Then you don’t know that none of them are hurt.

Learning from mistakes

In San Jose, the chili and the finger. Police took the chili. We thought they would go to the health department, the regulatory agency that governs us. The next day, we’re chasing the health department, and they don’t know what we’re talking about. Then we’re chasing the police department trying to find out where it went. He took it to the coroner’s office. Thought it was a body part. We lost a day chasing the bureaucracy.

West Palm Beach comes up, the cops are at the restaurant. Is it the police or the sheriff? “I don’t know.” I had one of the employees go out to the parking lot and read the side of the car. Now we know our line of contact. I picked up that lesson from San Jose. You only get that out of the post-mortems.

For food-safety crisis-management strategies, read “Ready or Not” from the August issue.