Stuff happens: What to do when you bear bad business news

The business world is definitely not for cowards. There are good days and, well, not so good days. Plans fail. Market conditions change. Projections miss the mark. As a manager, sooner or later, you will have to carry unpleasant news to your senior management team, or to your stockholders.

When that day comes, especially in today's competitive environment, you'll be tempted to push the panic button. Here's my advice: Don't.

As you stand on the cliff ready to jump, here are a few things to think about:

1. The sky (almost) never falls...so Chicken Little usually winds up looking foolish. Everyone who has been in business longer than five minutes knows that it's risky and bad things can happen. Inexperienced managers sometimes remind everyone of potential disaster every time a decision is made. Usually, their motive is to cover their own behinds, in case something goes wrong. It's unnecessary - and annoying.

Before you pull the fire alarm, make sure you are dealing with a real crisis, not just what could happen if things go wrong.

2. Size matters. Okay, so you've got a real issue that needs attention. But how serious is it? Are we talking a four-alarm blaze, or can you handle it with the extinguisher under the sink in the break room? Take a minute and rate your problem on a scale from one to ten. One means someone might be inconvenienced in a year or two. Ten: evacuate the building immediately. This will help you take appropriate action, without over - or under - reacting.

3. Timing is everything. You don't want to rush to the board room without all the information you need, but don't wait too long, either. Problems you ignore - even small ones - usually just get bigger. If the issue is pressing enough, people find out about it anyway. No one will love you for letting a nasty surprise grow to twice its size while you get your ducks in a row. Better let them hear from you in a timely fashion.

4. Two heads (or twenty) are better than one. Don't forget, when you share a problem with other managers, you tap into a rich pool of experience and possible solutions. Chances are, somebody has seen it before and has an answer it might have taken you weeks to figure out on your own. Business is always a joint venture that takes a whole team of smart people. Don't be afraid to pass the ball and let someone else run with it.

5. Take responsibility - but not too much. Many people fear delivering bad news because they think it is all their fault. Sure, people make mistakes, but more often than not, when things aren't turning out as senior management planned, it is due to elements outside anyone's control.

The current trouble in the sub-prime mortgage market is an excellent example. Suppose you've had a condominium development project in the works for a couple of years. You've done the work, and everything looks good. Then, suddenly, market conditions change, due to unforeseen events in an another sector of the real estate business. Money gets tighter. Consumer confidence falls. Through no fault of yours, you now have to report to shareholders that projections must be significantly revised.

Own up to your contribution to negative issues, but only yours. Keeping your perspective will make your job as an unwanted messenger much easier.

6. A steady flow is better than a flash flood. Create an environment in which you routinely discuss all issues - positive and negative - that affect your company. When information circulates freely, there is less need for dramatic "announcements" that catch everyone by surprise.

Bad news happens. But, if you keep your head when bringing to the attention of managers and shareholders, it doesn't have to be the end of life as we know it.