Introduction

Ever feel like things are going fine in your business, then unexpectedly BAM! You are hit by a social media storm, an unexpected technical error, or even something bigger? That is where effective crisis management comes into play. Think of it as your business's emergency toolbox, helping you navigate through the storm and emerge stronger than before. Rather than panicking when something unexpected occurs, you will have a plan to help you navigate this storm. Effective crisis management is not just about response; it is about being proactive and prepared for the next potential problem, even if you may not know what that is yet! 

What is Business Crisis Management?

In its simplest terms, business crisis management is how your business plans for and reacts to serious, unforeseen incidents that threaten its reputation, its people, or its ability to operate. Essentially, business crisis management is already having a plan in place that minimizes the impact of the incident, and helps you regain normal operations. Proactively handling a crisis helps guide you through that awkward "uh-oh" moment a little more calmly and prepared, control the damage, and reinforce your credibility going forward.

Understanding the Landscape: Types of Business Crises

To effectively manage crisis situations, it can often help to understand the "crisis" in respect to situations that can arise. Below are some common types of crises: 

• Sudden Crisis: These situations arise with no warning and demand immediate and definitive responses. Think natural disasters, accidents, and unexpected technology failures.

• Smoldering Crisis: Events that develop slowly with some identifiable warning signs, for example, employee morale dropping or persistent quality concerns. With a well- planned crisis management strategy, many situations can be averted where it does not develop further than a hot summer.

• Organizational Crisis: Involves situations that stem from internal conditions like an ethical breach, leadership failing, or even serious interpersonal conflict within the workplace.

• Technological Crisis: Involves issues that stem from outage of systems or cyberattacks; or loss of important data.

• Financial Crisis: Issues involving money that pose a serious risk to the organization's viability for the foreseeable future.

• Reputational Crisis: Issues to the organization's public persona that stem from many sources but include a PR disaster or professional ethical lapse. The intention of crisis control and management is to restore and build trust.

• Operational Crisis: Crises that interrupt an organization's service delivery or core business processes and major supply chain issues or broken equipment are good examples.

Real-World Examples of Business Crisis Management and Response in Action

Examining specific scenarios underscores the importance of preparedness and developing an effective crisis management and response framework:

Product Recall

Consider a pharmaceutical company with a safety issue requiring a large-scale recall. In their crisis handling processes, it will be very important to have a steady and rapid media response as well as clear communication and instruction for patients and healthcare providers, and to reassure the public with their commitment to safety.

Data Breach

One of the world's leading e-commerce platforms is attacked through an extremely sophisticated cyberattack with business and sensitive data stolen from their online operations. The company's crisis handling processes will require containment, communication with affected customers, remediation with security upgrades, and other solid remediation processes as a substantial part of their crisis handling.

Public Relations Disaster

A significant company engagement occurs where a senior executive of a high-profile organization makes indiscriminate or insensitive comments in a public forum. The back lash is immediate and immense, requiring an urgent and carefully formulated, but sincere response.  Normally, this reaction includes public apologies and some demonstration of changed behaviors as a significant part of their crisis control.

Natural Disaster

Hotel groups have a duty of care to their guests and employees and will immediately launch safety and support procedures when they find themselves in an area, particularly coastal regions subject to a major hurricane. They will take attendance of all guests and staff, conduct damage assessments, and commence pre-emptive business continuity plans to minimize any operational downtime as part of their crisis management.

Frameworks for Effectively Managing Crisis

Implementing any of these various frameworks effectively can provide valuable oversight for significantly all aspects of crisis management. Here are a few established frameworks when you find yourself needing to work through these issues:

The 5 P's of Managing Crisis

• Prevention: Engaging in pre-crisis risk management and crisis risk management steps before the potential risk becomes a crisis;

• Preparation: Developing a systemic crisis management plan that identifies participant roles, communication, and resources needed in the event of a crisis;

• Performance: Acting decisively, and as planned, and performing actions according to the plan once the crisis has commenced;

• Public Relations: Communicating clearly, openly, honestly, and with empathy with everyone impacted by the crisis, which includes the public and the media;

• Post-Crisis Review: Reviewing the events that happened and how they were managed to see what lessons were learned, lessons that can be applied for security in the future.

The 4 C's of Crisis Handling and Management

• Control: Regain control of the storytelling process and the actions being taken to do the best you can;

• Competence: Have the trained crisis control team who have the skills, knowledge and authority to manage the plan and situation so they can effectively generate control over the crisis;

• Concern: Show genuine care, empathy, and concern to all people affected (individuals and groups); and

• Consistency: Provide clear, consistent and unified messaging to everyone and in each character's conversation, during and management of the incident.

The 15/20-60-90 Rule

This communications principle highlighted the different ways segments of the population process information in a crisis. It is important to acknowledge that around 15% will likely believe the first piece of information, and around 20% will most likely not believe that information. Thus, it is vital to consistently and clearly communicate factual information to the important group of people, approximately 60% of the population, who are searching for their information from reputable sources. Your overall crisis control communication strategy should be planned to reach and inform this majority of the population.

Final Words, 

Crisis management is not just a reaction; it is part of a prudent, resilient way of doing business. By thoughtfully understanding the different categories of crises, learning from real experiences, and implementing the 5 P's and 4 C's framework for crisis management, while being mindful of the basics of crisis communication that relates to the 15/20-60-90 rule, your business can know how to become resilient, and in time and likely due to some sort of crisis, proactively support itself to rebuild, and create a healthier and more stable environment for the long run.