Corporate crisis management does NOT start with the crisis

Organisations today are increasingly vulnerable and crisis prone. A crisis can arise from a variety of internal and external factors in today’s highly polarised society . Natural disasters, cyber-attacks resulting in loss of sensitive data, employee misconduct or whistle-blowers, consumer or shareholder activists, non-compliance, product recalls, greenwashing and so on. The media landscape is such that information travels at the speed of light and everyone is watching. In today's interconnected world, organizations need to be prepared to respond quickly and effectively to crisis situations to minimize the damage and restore stakeholder trust.?“We are hardwired to neglect the possibility of a crisis” opines Erika H. James ?in "The Prepared Leader" – a playbook on crisis leadership. "Just as one crisis starts to resolve, another is already taking shape" she says. "Even as you read this, another crisis is already brewing."??

One of the key challenges corporates face while managing a crisis is the act of balancing the need for transparency with the need to protect the organization's reputation from speculative attacks. While honesty and transparency with stakeholders is critical, the team in-charge has to very carefully consider what narrative it is trying to convey and the fact that its message and statement is accurate, timely, and appropriate. The urgency to communicate during a crisis is inversely proportional to the information available. Therefore, if organisations wait to gather all the relevant information about the crisis at hand, they may never be able to communicate and run the risk of submitting the narrative-space to others. The most critical aspect of managing a crisis is to understand who are the stakeholders involved; people who are impacted and have a stake or an interest in the event or the matter and what are their sources of influence.

Crisis management does not start with the crisis?

Organisations that respond well to a crisis are those that have developed institutional capabilities to deal with such situations. In other words, they invest in crisis preparedness and stakeholder engagement as an ongoing management practice. There have a ‘SWAT’ team that is always engaging with internal and external stakeholders – employees, customers, investors, regulators, and media, and has established open lines of communication and collaboration, understands varied interests at play and works with all on issues of real importance. This team has a 360 view of the industry and the business and is focussed on protecting the company's 'license to operate' in the non-market arena i.e. regulatory, policy, political, activists, etc. Ian Mitroff , a professor and crisis management expert, emphasizes on the importance of proactive crisis management, including the development of a "crisis prevention culture" in organisations.

It is necessary to bring-in external expertise to assist the management not only during the crisis but, on an ongoing basis. This is because what is needed is a constant 'outside-in' perspective, someone who frames issues from the lens of stakeholders and also provides candid feedback when the management really needs it. This expertise could come in the form of legal counsel, public relations and communication specialists, crisis management consultants, and so on. These experts can provide insights and learnings from other such situations that they may have handled or studied and that perspective is useful in scenario planning and while navigating the crisis. Therefore, when a crisis actually occurs, this team is in a much better position to quickly assess the situation and gather available information to develop a ‘response & repair’ strategy. This includes identifying the trigger of the crisis, its scope and potential impact, the organisation's real-time ability to ‘respond & mitigate’ the issue. Not only this, the team is also better prepared to conduct ‘root cause analysis’ of the issue/ crisis, its long-term implications, and in parallel can work on long-term ‘remedies of recovery’.?

Communication at the Core

The most important and immediate aspect during a crisis management is communication but, it is surprisingly most neglected. Organisations want the crisis "to go away immediately" but, this rarely happens. Numerous articles and books have been written on this subject such as "Code Red in the Boardroom" by Timothy Coombs which highlights the importance of effective communication during a crisis, particularly in the context of social media and also lists a variety of activities that the organisation should perform daily to prevent crises from occurring.

The crisis management team, experts argue, should focus on executing a communication plan that includes messaging for internal and external stakeholders. It should include regular updates on the situation and steps the company is taking to course correct. Clear and consistent communication always helps to reduce confusion and panic and protects or restores stakeholder trust. Coombs's "The Handbook of Crisis Communication" is a good playbook for strategic planning and the development of pre-crisis plans and post-crisis evaluations.

In a nutshell, the core message is that effective corporate crisis management, including issues management, has to be a board-level, management function and not a reactionary tactic. This is critical for organizations who want to protect their reputation and maintain stakeholder trust. Organisations should strive to continuously improve their crisis management capabilities to be better prepared for future crisis, which is always lurking round the corner. In other words, "what organisations need is to invest in the idea of "The Prepared Leader" (or prepared leadership )...the duty to prepare organisations and people for the worst, to weather the storm and drive positive change in its aftermath" as summed up by Erika James.?

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