There are classic cases of companies which failed to live up to demands of disaster management during times of crisis. Truth is – they could have avoided both the embarrassment and the wrath of stakeholders easily

The Toyota and BP debacles have once again shown us the consequences of organisations failing to manage a crisis effectively. The tragedy is that it was all so avoidable. In cash terms these crises can be counted in billions of dollars but unfortunately the consequences will ripple on for many years – a high price to pay for failing to manage relatively simple crisis scenarios. It is amazing how much time and money is spent on developing and discussing strategy compared to developing the skills needed to implement it or manage it if things go horribly wrong. The rules of crisis management are really quite simple.

Prepare for the unexpected
It may be an unpleasant thought but if you run an airline (like in the case of the three largest number of passengers carrying airlines in the world: Delta Air Lines – which carried 162.6 million passengers in FY2010; United Airlines – which carried 145.6 million passengers in FY 2010; and Southwest Airlines – which carried 131 million passengers), the chances are that one of your planes might crash one day. You would have definitely heard of plane crashes and emergency landings by now, haven't you? If you make food, you might experience a health scare. If you run a car company like in the case of Toyota, ford, GM and many others, you might have to manage a recall. If you run an oil company, you might have to manage a spill (as was experienced in the case of Exxon Mobil and BP). It is vital to work out how your organisation would react if the worst were to happen and plan and train accordingly. Whilst risk registers and contingency plans are a good start, they can fool you into thinking that you have all bases covered. Planning and training must encourage creative flexible open behaviours. It is important to remember that it is usually the crisis that you never thought of that kills you.

Preselect, train and empower a crisis team
When crisis strikes, things develop at a devastating pace and companies need to react fast regardless of time zones, corporate procedures or internal politics. Individual leaders and teams should be preselected, trained and empowered to react instantly and calmly to the situation. The consensus culture at Toyota condemned them to losing the initiative and being butchered by the media over their recall crisis. Unless you are ahead or on the curve you will always be playing catch up and the crisis will spread systemically.

Put yourself in the customer’s shoes
Toyota customers were happy to pay premium prices for two key things - reliability and safety. When Toyota finally reacted, their crisis spokesmen tried to explain everything in engineering terms. What they should have done is consider what their customers may have been thinking (which is likely to have been whether their car was safe to drive). You have to build trust with your customers before their goodwill turns to anger, resentment and even personal hatred (as with BP).
 
Regret, reason, remedy
First you have to show that you are human by showing empathy for those people affected and express regret for what has happened. Many people fear legal consequences and are often told “never say you are sorry”; but showing that you understand the feelings of your customers is not the same as admitting liability. Secondly, try to explain in straightforward terms what has happened and the reason. “Unless you are ahead or on the curve you will always be playing catch up and the crisis will spread systemically.” If you don’t yet know, then say so and do not hide information that customers need to know. Lastly, get control of the situation by stating what you are going to do to remedy the situation.

Communicate, communicate and communicate
During times of crisis – no matter how big or small – organisations often feel that they are being attacked by a hostile press and the temptation is to close the doors, call a meeting and ignore the ringing phones. While it is important to establish your message, it is vital that you are seen to be openly communicating as soon as possible – speculation fills a vacuum. Communicate to your customers via the media but don’t forget the other key stakeholders including your own employees, suppliers and partners.

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Source : IIPM Editorial, 2011.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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28/02/2012 10:48pm

Prepare for the unexpected and learn to recognize when an idea has reached to the customer. Every interaction of customer has with you helps him do more by making it simple.

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29/02/2012 12:21am

Communicate! starts with the foundation of communication: receiving communication from others, sending communication to others ( we can say conveying of message) . It proceeds to conducting and attending meetings, giving presentations .

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29/02/2012 12:31am

Educating and guiding consumers has always been at the heart of our communication strategy.The way communication was conceived, presented and consumed underwent a seismic change.

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29/02/2012 12:42am

Humanly speaking, people want to be cared about and taken care of continuously, and much more so in a time of crisis. This cannot be iterated enough. Sharing knowledge and identifying with the confusion of the employees is paramount.

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29/02/2012 12:51am

I would like to believe that organizations worldwide are finally “getting it” about crisis management, whether we’re talking about crisis communications, disaster response or business continuity.

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29/02/2012 1:03am

However, this must be clarified among stakeholders early, to avoid confusion both inside and outside a foundation and to avoid sending mixed messages to the media and other interested parties..Also providing a more objective vision of how to handle a range of crises.

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29/02/2012 1:17am

Crises occur when management takes actions it knows will harm or place stakeholders at risk for harm without adequate precautions.

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29/02/2012 1:21am

Crisis handlers work diligently during this stage to bring the crisis to an end as quickly as possible to limit the negative publicity to the organization, and move into the business recovery phase.But they will also actively pursue organizational resilience.

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29/02/2012 1:27am

In the wake of a crisis, organizational decision makers adopt a learning orientation and use prior experience to develop new routines and behaviors that ultimately change the way the organization operates.

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29/02/2012 2:07am

First you have to show that you are human by showing empathy for those people affected and express regret for what has happened.Try to explain in straightforward terms what has happened and the reason.

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29/02/2012 2:16am

Reason and remedy we can find helpful processes in IT service management. The event management can help you finding the reason & problem management will allow you to provide a long-term remedy, avoiding re-occurrence.

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29/02/2012 2:27am

Social networking has provided business continuity planners with a valuable tool for communication and information gathering during a crisis.

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29/02/2012 10:11pm

We have found that the most challenging part of Crisis Communication is to react – with the right response.In short, crisis is change.

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29/02/2012 10:23pm

We have a duty to communicate to our customers but to do it in a way that is helpful, informative, optimistic and sensitive. More direct form of communications can be as, or more, effective in maintaining that customer relationship in times of adversity.

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01/03/2012 1:04am

In spite of all these problems that language or words bring, communication has still to take place. As human beings, our task is to learn how to communicate and communicate clearly.

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01/03/2012 1:38am

If you don’t yet know, then say so and do not hide information that customers need to know. Lastly, get control of the situation by stating what you are going to do to remedy the situation.

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01/03/2012 1:48am

The best leaders recognize and are purposeful and skillful in finding the learning opportunities inherent in every crisis situation.The prior experience change the way of organization operates.

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02/03/2012 12:29am

Crisis handlers not only engage in continuity planning (determining the people, financial, and technology resources needed to keep the organization running), but will also actively pursue organizational resilience.

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02/03/2012 12:34am

The most executives focus on communications and public relations as a reactive strategy. While the company’s reputation with shareholders, financial well-being, and survival are all at stake, potential damage to reputation can result from the actual management of the crisis issue

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02/03/2012 12:50am

The recent highly public Toyota recall has shown once again the consequences of organizations failing to manage a crisis effectively.. A high price to pay for failing to manage what appears to be a relatively simple crisis situation. The tragedy is that it was all so avoidable.

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02/03/2012 1:00am

In our research study, executives believed external perspective (EP) development activities lead to the achievement of business objectives, more innovative decisions and solutions, new business opportunities, specific organizational changes, better business strategy, and enhanced personal credibility.

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02/03/2012 1:11am

We need to know more about the part of the industry, for example – that conversation with a customer is an opportunity to understand a bit about the industry from their perspective.

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02/03/2012 1:17am

The programer is carefully designed to provide the maximum benefit in the shortest and most realistic time possible, with the flexibility of a modular format.

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02/03/2012 1:25am

We will explore the different attributes and approaches of projects and programme management. It is designed for project managers who are experienced in delivering projects and are looking for one step further than the methodologies and technologies.

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02/03/2012 1:33am

But every time our ability to access information and to communicate it to others is improved, in some sense we have achieved an increase over natural intelligence.Lay out the rules, communicate with employees, motivate them and reward them.





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02/03/2012 10:06pm

A short-list of best practices for both response and prevention was collected and served as the basis for identifying key strengths of the crisis management.

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02/03/2012 10:16pm

To learn from these recent events and to enact our commitment to continuous improvement. It also provides guidance for the improvement of policies,
communications strategy and technology, structure, role clarity, committees, resources and training.

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02/03/2012 10:35pm

Planning and training must encourage creative flexible open behaviors. It is important to remember that it is usually the crisis that you never thought of that kills you.

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02/03/2012 10:40pm

Some principles and goals about the level of detail, channels and frequency of updates, both for internal and external audiences. Providing customers and employees with clear updates is key to gaining respect and a positive reputation during a crisis.

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03/03/2012 1:11am

If you run a car company like in the case of Toyota, ford, GM and many others, you might have to manage a recall. If you run an oil company, you might have to manage a spill (as was experienced in the case of Exxon Mobil and BP). It is vital to work out how your organization would react if the worst were to happen and plan and train accordingly.

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13/03/2012 5:55pm

Cool thing that you all have the intelligence for this matter, the thoughts that was written are great.

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