Tuesday, 29 June 2010

Crisis Management 101

We all have to face crises in our careers as managers and entrepreneurs, and it's often said that your ability to handle a crisis is what defines you as opposed to how you manage "business as usual".

I'm sure that anyone reading this can come up with examples of "good" and "bad" responses to crises to show what I mean. Such examples will often form the basis of business school studies, but from my limited experience, you need to cover off a number of areas when handling a crisis.

Firstly, what's the situation now? What needs to be done to stop it getting worse? What equipment/manpower, money, official/government support, etc is needed? How long to get it?

Secondly, who are the "stakeholders" involved: buyers, suppliers, staff + families, management, shareholders, community, government? What's the impact on them, and what action is needed? Do you need to calm nerves, soothe feelings, explain what's going on? What's the best way of doing so? Look at BP and how they've handled things - stakeholder management could have been better.

Legal: any possible litigation problems (against you?). Do you need to start litigation against someone else? Do you need to talk to a legal adviser?

PR - who needs to be briefed? How will you do it?

HR: what staff issues will you have? Do you need extra time worked to clear things? Will you have a potential court action on your hands or a strike? Will you need to make special arrangements for staff/families? Will you need extra people to help out? Can you get them? If the crisis was caused by a member (or members of staff) being negligent, what discip[linary action is required? How do you keep up staff morale during the crisis?

Systems: What is the impact on your systems? Do they still work? Do you need new computers/servers? Can y ou get them? How long to set up/restore data? Is your data intact and not compromised?

Processes: did staff follow laid-down procedures, or was the problem due to faulty or out of date processes? What needs to change?

Lessons learned: what can you learn from this for the future?



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