We all love to work in a predictable world – a world where we have a reasonable amount of control of what we do and in which we have few surprises. The Covid-19 crisis shook all our assumptions about how we prepare for and manage crises in our organisations. Most organisations were completely unprepared and had to make it up as they went along in their response to the crisis.
While we can accept that very few organisations had plans in place for dealing with a pandemic, it has prompted us to think actively about how we may respond to future crises. Future crises can take different forms and a lack of preparedness can result in business hardship or even business failure.
Essentially there are two ways of responding to a crisis:
- An organisation can respond reactively, springing into action only when a crisis has occurred. This entails coming up with plans and resources at short notice with little foresight.
- Or an organisation can take decisive crisis leadership steps to identify possible crises and plan how to respond to them.
While it’s impossible to plan for every single eventuality, thinking about various types of crises creates the frame of mind, and establishes the planning and the execution guidelines that can be adapted to a unique crisis.
Crisis leadership is proactive, seeking to plan as carefully as possible before a crisis occurs. Crisis leadership considers the big picture and the full range of possible crises. By doing so, smart organisations put themselves in the positive, assertive frame of mind that helps them weather any disaster.
If you aren’t prepared to handle a crisis, you cannot respond effectively when it occurs. Let’s explore some simple categories of crisis.
The major types of crises are as follows.
- Economic crisis. This includes labour strikes, a decline in the share price or market fluctuations. Most organisations deal with these from time to time, so these events are not unfamiliar.
- Information crisis. This includes the loss of proprietary information or intellectual property information, or your computer systems may have been hacked. This is becoming a bigger and bigger challenge for organisations, especially in the area of cybersecurity
- Physical crisis. This can take the form of loss of key equipment, a plant breakdown, or major plant disruption through electricity supply interruption or something similar. Climate change brings extreme weather conditions, and these can massively disrupt our operations.
- Human resource crisis. Examples are the resignation or death of key executives, vandalism, sabotage and workplace violence. The loss of key personnel means that large amounts of institutional knowledge are lost and may not ever be recovered.
- Reputational crisis. A senior executive may have committed fraud, or a social media campaign may affect the organisation’s good name. Reputation, once lost, is exceedingly hard to win back.
- Malicious acts. These include tampering with your products and kidnapping key personnel. These are bad when committed by outsiders with a grudge. But they are doubly damaging when committed by employees. It may be a sign of a dysfunctional organisation, or it may be a result of an employee who feels deeply wronged.
- Disasters. These include fire, floods, and earthquakes. Climate change has a role to play here, as well as utility infrastructure providing a conducive physical environment. A collapsed bridge, a blocked stormwater levee or a tsunami wave can wreak untold havoc.
While it is impossible to identify and plan for every possible eventuality, it is best to prepare a plan and response playbook for at least one likely crisis in each of the categories we have noted above.
How do you go about establishing your crisis leadership capability to set in place the thinking, the policies and the checklists to respond effectively in a crisis:
- Assemble a cross-functional and cross-divisional crisis team, as part of your risk management processes. Don’t include only those based on their seniority, there are many risk insights among operations employees.
- Brainstorm the types of crises that may eventuate. Think broadly and widely. What could possibly go wrong?
- Develop at least one crisis playbook for each of the situations described above. The playbook should cover the What, How, Why and Who of addressing the crisis.
- Determine the indicators that signal a crisis-in-the-making. Review these regularly in your risk committee.
- Have your key staff been trained in crisis communication? Build this into your leadership development programmes.
Establishing a robust crisis response capability involves the following:
- Develop crisis scenarios for each category. Vividly describe what may happen and identify the risks and downsides it will bring.
- Create a playbook for each scenario. What has to happen is to respond quickly and adeptly, uncover best practices and learn from mistakes that may have already been made by others.
- Write up policies and procedures. Who is on the team? What are their roles and responsibilities? Who is the designated spokesperson and is that person trained? How will you work together? Put together a guide and a chain of command so that you and your employees know how to act quickly and in concert.
- Develop key messages. Planning ahead gives you time to understand who you are and what you and your organisation represent. What differentiates you? Consider holding a messaging session where you can hash out keywords and messages that embody your brand and that will resonate with target audiences. Have clear, concise messages that are already in play and reflected in all communications — from email to traditional media to social media. Train others within your organisation to use these key messages.
- Respond thoughtfully. A quick response is not always the right one. Assess the situation and decide if and when is the right time to respond. Sometimes a quick but thoughtful response can shut down a problem before it spins out of control, but other times, some issues fizzle out naturally. And always take caution to avoid knee-jerk responses (particularly via social media) that can come back to haunt you later.
Few of us can predict a crisis. It is also not possible to be prepared for every single type of crisis that may befall an organisation. But a regular review of possible crisis events in other organisations and other countries and an objective view of world events can help us to develop positive impactful responses in times of crisis.