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Got Bad News? Be Ready to Explain Yourself

Ever had to break bad news to your employees or customers? How you do it could make a big difference in how it is received.

That’s the finding of a management researcher who says employees’ and customers’ negative reactions can be stemmed by good communication even in bad situations.

“Leaders sometimes have to make tough choices that can result in loss and disappointment to their followers,” said Terry Cobb, professor in the Pamplin College of Business at Virginia Tech. “Such decisions undermine the commitment and cooperation that leaders need from their followers to be effective.”

Negative reactions, however, can be mitigated by the explanations given for those decisions.

“They can be seen as devices not only for accounting for one’s action but also for helping message receivers to understand the situation and the players involved, and for convincing message receivers to think better of leaders,” Cobb said.

Such communications can increase employee perceptions of fairness and mitigate adverse reactions to downsizing and layoffs, unfavorable changes in benefits, negative feedback, and undesirable behavior, he said. “They can also increase the willingness of customers to do business with a company, repair trust following a violation, help facilitate organizational change, and help the leader maintain a more positive image.”

In a recent study, Cobb and his co-author, Francis Frey of the University of Virginia’s College at Wise, focus on what makes accounts effective or successful by examining the effects of the specificity of the message, the expertise of the source, and the extent of the losses that the explanations are intended to address.

“We found that when managers give an explanation for decisions that have caused loss, they need to be more specific in addressing the concerns of their followers and the reasons behind their decisions. Being vague or dismissive can actually make things worse,” Cobb said. And the greater the loss incurred, the greater was the need for specificity.

His study has been published in the Journal of Applied and Social Psychology.