Question

CASE # 3 (Crisis Planning at Livestrong Foundation)

In 1996, Lance Armstrong, the now-disgraced pro cyclist, was diagnosed with testicular cancer. Only 25 years old when he found out he had cancer, Armstrong chose to focus on being a survivor, not a victim. During his personal battle with cancer, he soon realized there was a critical lack of resources for individuals facing this disease. He decided to start a foundation devoted to helping others manage their lives on the cancer journey. Since 1998, the Livestrong Foundation has served millions of people affected by cancer. But in October 2012, everything turned upside down for the organization. That’s when the U.S. Anti-Doping Agency released its report that “concluded once and for all that Lance Armstrong, the cancer charity’s founder and chairman, was guilty of doping during his legendary cycling career.”

Doug Ulman, CEO and president of the Livestrong Foundation at the time, said he remembers that day clearly. In fact, he had anticipated for months that this day would come. As good friends, Ulman had believed Armstrong’s statements of innocence over the years. But now, “there was no more hiding.” After the news broke, Ulman called a meeting of every one of the foundation’s 100-person staff, all squeezing into the foundation’s boardroom. There, shoulder to shoulder and crammed together, the suspicions and tingling uncertainties all of a sudden became all too real. When Ulman announced that the organization could no longer “defend” its founder, it was a defining, watershed moment. Livestrong, the once highflying charity which had raised half a billion dollars over the years, was now facing a crisis—maybe even a life-or death crisis— of its own. Now, Livestrong would be operating in “life without Lance” mode.

Although it might be tempting to write off Livestrong as a hopeless case, Ulman and the rest of Livestrong’s staff have worked hard to keep the foundation viable and focused on its purpose. It’s not to ignore the challenges facing the Crisis Planning at Livestrong Foundation organization, because those challenges are significant. But in managing through the crisis, Ulman had to keep staff morale up and make plans to transform and distance itself from Mr. Armstrong. One piece of advice he received from a crisis communications firm was to take the opportunity to get the foundation’s message out. Like many of the cancer sufferers it helps, Livestrong wanted to come out on the other side stronger than ever. It’s not been easy. The foundation has lost some of its biggest sponsors, including Nike and RadioShack. Revenues fell in 2012 and 2013. But in addition to his “crisis management” responsibilities, Ulman has been formulating plans and strategies. He says, “It’s so ironic—we are in the business of survivorship, that’s what we do. Now we find ourselves dealing with the same circumstances in a totally different place.”

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A new phase in Livestrong’s history began in early 2015. The foundation’s Board of Directors announced a new president and CEO, Chandini Portteus. She comes to Livestrong from Susan G. Komen, the most widely known, largest, and best funded breast cancer organization in the United States. With her extensive knowledge and skills in fundraising, global programming, and advocacy, Livestrong has an individual well-versed in the challenges of leading this organization into the future.

Case # 3- Discussion Questions

1. Could an organization even plan for this type of situation? If yes, how? If not, why not?

2. How would goals be useful in this type of situation? What types of goals might be

necessary?

3. What types of plans will be useful to Livestrong? Explain why you think these plans

would be important.

4. What lessons about planning can managers learn from what Livestrong has endured?

Answer 1

1. From a completely business or commercial standpoint, accurate forecasting or prediction about any organizational crisis or predicament is evidently difficult which essentially contributes to the difficulty of coming up with an effective and well-formulated crisis management plan for any such potential predicaments. In this particular circumstance described in the question, the financial, commercial, and internal organizational crisis confronted by Livestrong Foundation ideally constitute an unforeseen crisis or trouble that emerges out from an initial or earlier organizational or managerial stance on truest issue regarding the viability of its original founder. The magnitude or extent of the commercial and financial aftermath of such occurrence has been mostly unpredictable hence, any prior effective crisis management planning or strategy becomes practically difficult in those challenging circumstances. Such predicaments are universally common in any business operational path in which the company or organizational management can frame a general overview of the common business crisis or troubles but accurate and exact prediction or forecasting of those crisis/troubles is practically difficult and furthermore, gaging or examining the actual extent or the magnitude of their impacts becomes even more problematic. Therefore, all of these factors evidently impact the entire crisis-management planning and implementation process in any business organization or company.

2. Effective crisis communication and mitigation plan essentially involve a clear strengthening and dissemination of the core values and missions of any company or business organization. With reference to the particular crisis faced by the Livestrong Foundation in this case, it is very important for the company or the organizational management to highlight the core company philosophies and missions which are strongly associated with providing necessary and vitality for the cancer patients, which is the core foundational objective of the organization. Hence, the organization must emphasize on the positive achievements and appreciations that it has gained in the past in the course of striving to achieve its main organizational goals and objectives. The purpose of this strategical approach is to mitigate the extent of the ongoing crisis and further consolidate public trust and belief which is extremely crucial as far as effective crisis management is concerned. Hence, as part of the long-term crisis management plan or strategy, the key is to enhance and consolidate public trust and confidence which can immensely enable the organization to mitigate the extent or magnitude of any crisis or predicament as explained or demonstrated in this instance.

3. Now, considering the financial, commercial, and internal impacts of the particular crisis described here, it is imperative for Livestrong Foundation to initially analyze or assess the actual magnitude or extent of the risk posed by the concerned crisis and develop an efficient and trusted crisis management team who would be primarily responsible for the risk assessment and monitoring and coming up with the particular plans or strategies to effectively combat the crisis based on its severity and overall organizational impact. in this context, crisis management can analyze the potential economic risks and fatalities that can be caused by the disconcerting loss in marketing and advertising sponsors and overall revenue level and subsequently construct a convincing plan or strategy on how to recover the positive public image, impression, or reputation that might be jeopardized through the intensification of the ongoing crisis. In this regard, the team has to contemplate the various marketing or promotional sources and mediums such as public media broadcasters, social media sites and platforms, and other related mediums to disseminate and highlight the positive image or publicity about the organization as part of the crisis management strategy or plan. It is also important to prevent the contagious effect or further severity of the crisis which ideally construe reconsideration and restructuring of the internal organizational policies and strategies by the management. Additionally, organization management should assign an efficient and trustworthy spokesperson to publicly address the effectiveness and sincerity with which the company has implemented various crisis-management plans and strategies and its potential efficacy in gaining back the potential commercial or economic success. This would primarily generate a sense of trust and confidence in the public mind about organizational viability and efficiency.

4. Crisis management or mitigation planning basically requires both the prevention of the external damages and internal organizational damages caused by any concerned crisis or predicament. The external damages practically pertain to the possibility of a loss in public trust, confidence, and reputation as the crisis intensifies and jeopardize the commercial or economic position of the concerned organization. Hence, it is extremely crucial to incorporate the proper crisis management plan to restore and maintain a positive public image amidst any organizational crisis or predicament as explained in part 3. of the question. Furthermore, it is equally imperative for any company or organizational management to restrict any further contagion or intensification of the ongoing crisis through proper and appropriate internal management policy considerations and/or modifications and their effective implementation or execution. This process essentially involves an intensive restructuring of the internal organizational departments, changes in the company or organizational strategies pertaining to the concerned or respective departments, and mobilizing the existing workforce and organizational resources to re-stabilize the internal operational functioning of the organization.