BAD NEWS TRAVELS FAST—SO SHOULD YOU!

By Jamey Lutz—

The Temptation to Wait

In 2010, BP faced one of the worst environmental disasters in history—the Deepwater Horizon oil spill. Instead of immediately acknowledging the severity of the situation, the company initially downplayed the amount of oil being discharged and the potential environmental impact. As the crisis escalated, their slow response and lack of transparency led to widespread public outrage.

BP’s failure to communicate honestly and promptly created a double frustration effect—people were angry about the disaster itself, but even more frustrated upon learning that BP had withheld critical information. Had they been upfront from the beginning, they could have maintained more control over the narrative and mitigated some of the reputational damage.

This example highlights a common mistake in business: the instinct to delay bad news—whether out of fear or in hopes of finding a solution before sharing it. But in reality, postponing the truth only makes things worse.

It's not a good idea to delay sharing bad news with your customers!

The Double Frustration Effect

When bad news is withheld, customers experience frustration on two levels:

1. The initial frustration of the problem itself.

2. The secondary frustration of realizing they weren’t informed sooner.

This second frustration is often more damaging because it introduces feelings of betrayal, helplessness, and distrust—all of which are far harder to repair than the original issue.

The Psychological Goodwill of Proactive Honesty

There’s a psychological principle at play here: perceived control and trust-building. When customers receive bad news promptly, they feel included in the process rather than excluded from it. Even if the situation is unfavorable, knowing that a company is actively working on a solution engenders psychological goodwill—it signals responsibility, competence, and respect for the customer’s time and needs.

On the other hand, withholding information robs businesses of this goodwill. Customers may not love hearing bad news, but they will appreciate knowing that you respect them enough to keep them informed.

The Perils of Waiting

Delaying bad news doesn’t just create frustration—it actively harms customer relationships. Here’s why:

• Erosion of Trust – Customers value honesty. When bad news is withheld, they feel deceived rather than supported.

• Escalation of Frustration – The longer a customer remains unaware of an issue, the more disruptive it becomes for them.

• Loss of Control – Waiting too long can force customers into reactive mode, limiting their ability to adapt or make informed decisions.

• Reputation Damage – A lack of transparency can lead to negative word-of-mouth, harming long-term brand credibility.

The Power of Proactive Communication

A critical guiding principle—"Now is better than later, and now makes later, better"—reinforces the idea that immediate honesty fosters better outcomes. When bad news is shared promptly:

• Customers can adjust their expectations and plans accordingly.

• The business maintains control of the narrative rather than letting speculation take over.

• Solutions can be discussed collaboratively, strengthening the relationship rather than weakening it.

How to Deliver Bad News Effectively

While transparency is key, how you communicate bad news matters just as much. Here are four ways to do it well:

1. Be Direct, But Empathetic – Acknowledge the impact on the customer while being clear about the situation.

2. Offer Context – Explain why the issue occurred and what steps are being taken to address it.

3. Provide Alternatives – Suggest solutions or workarounds to minimize disruption. When possible, invite customers to partner with you in the resolution process.

4. Follow Up – Keep customers informed about progress, reinforcing your commitment to transparency.

Final Thoughts

Bad news is never easy to share, but delaying it only compounds the problem. By embracing a mindset of proactive honesty, businesses can build stronger, more resilient customer relationships. In the end, transparency isn’t just about damage control—it’s about demonstrating integrity, fostering trust, and ensuring that "later" is always better because "now" was handled the right way.

Call to Action

How does your organization handle difficult conversations with customers? If you’ve seen the benefits of proactive honesty—or the consequences of delayed communication—share your thoughts in the comments. Let’s start a conversation about building trust through transparency.

jameylutz.com