Over the past year, a growing list of well-known brands — including Saks Global, Rite Aid, Forever 21, and Marriott — have found themselves in the headlines for bankruptcy filings, operational breakdowns, or reputational backlash. While each situation looks different on the surface, they all point to the same underlying issue: crisis leadership failures that began long before the crisis became public – a dimmer switch versus the flick of a light switch.
A timely example came up last week with the Verizon wireless outage, which disrupted calling, texting, and mobile data for customers across large parts of the U.S. Phones were pushed into “SOS” mode, and for hours, millions of people were left without reliable connectivity. While Verizon worked to restore service and later offered account credits, early communication was limited, forcing customers to rely on social media and outage trackers for answers. The outage itself was disruptive — but the leadership response shaped how customers perceived the event. It felt as if many were wondering this this was a technical issue or widespread cyber-attack.
This highlights a critical distinction leaders often overlook: the difference between sudden crises and smoldering ones. Research consistently shows that roughly 70–75% of corporate crises are “smoldering” issues — problems leaders were aware of, or should have been aware of, but failed to address quickly enough. These slow-burn issues don’t grab attention at first, which makes them easier to ignore — until they explode into full-scale crises.
The Verizon outage may feel sudden to customers, but system vulnerabilities, redundancy planning, and response protocols are all smoldering issues (or opportunities) that require leadership attention long before something breaks. The same pattern appears in recent bankruptcies. Saks Global’s collapse followed years of mounting debt and delayed decisions. Rite Aid’s repeated financial struggles reflect unresolved operational and legal pressures. Forever 21’s decline was driven by leadership waiting too long to adapt to shifting consumer behavior.
Across industries, the lesson is clear: crises are rarely caused by a single bad day. They are the result of hesitation, overconfidence, and delayed action. Leaders often move quickly when faced with dramatic, visible emergencies — but move far too slowly when the warning signs are quieter. In Fallston Group’s experience, there are often many reasons for this, including the fact that hard decisions often lead to investor backlash, stock price hits, and layoffs. Not to mention an overreliance on brand longevity and perceived marketplace power.
Strong crisis leadership isn’t about perfection. It’s about early recognition, transparent communication, and decisive action. Customers, employees, and stakeholders can tolerate disruption. What they won’t tolerate is silence, confusion, or the sense that leaders failed to act when they had the chance. Again, ‘If you don’t tell your story, someone else will.’ However, our mantra taken one step further, ‘If you don’t take action, someone else will.’
In today’s environment, where a single outage or headline can redefine a brand overnight, crisis leadership is no longer optional — it’s a core responsibility of anyone in charge.
