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How to: Manage through a Major Crisis in Five Stages By G. Mark Towhey You wish you’d gotten to it last week, last month, last quarter. Because, you sure could use a plan right now! A crisis has just erupted and you really wish you’d attended that crisis leadership seminar last winter, or scheduled that meeting to discuss crisis management or prepared the crisis plan that might have guided your decisions right now. Whether you’ve got a crisis plan or not, the situation’s hit the fan and here you are. Now, it’s up to you and your team to pull your company, your employees, your clients out of the fire and to lead them safely through the crisis. If you fail, people and your company may suffer or die. If you succeed, your company may be stronger than its ever been. How will you manage through this crisis? What do you do when something bad happens to your company, your employees, your customers, your community? What do you do if a bus/plane/train/boat load of your customers crashes? What do you do if your product has just been identified as the cause of a dozen deaths nation-wide? What do you do if your major corporate client goes out of business? What do you do if your CEO is accused of racism? What do you do if your head office burns down? What do you do if your community is evacuated due to a major natural disaster? In an ideal world, you’d have a wonderful plan to guide you each step of the way. Then again, in an ideal world, a crisis wouldn’t happen. So… Plan or no plan, you should lead your organization through this crisis in five, easy-to-remember stages. But, first… Understand what a crisis is There are many different definitions of crisis, but perhaps the most useful one is this: a situation that severely imperils your organization’s ability to succeed in its mission. The examples listed at the beginning of this article – major crashes, product contamination, fires, scandals, supply chain interruptions, etc. – begin to illustrate the various ways that crisis can impact your organization. While there are an infinite number of ways crisis can strike, there are generally four major dimensions along which crisis will impact your organization:
One of the defining characteristics of a crisis is that its outcome is uncertain. In every crisis, there is an opportunity to influence the outcome – to emerge from the crisis stronger, weaker or not at all. Therefore, it’s essential you set clear goals for your crisis management efforts. Understand the goals of crisis management Organizations are rarely impacted along just one crisis dimension. Quite often, a crisis that begins along one dimension will grow to include other impacts. The tour bus crash, for example, imposes an immediate security and life safety impact on passengers and quickly creates an operational impact for the company which has to reallocate fleet resources. If the crisis is not well managed, the company will experience a negative reputational impact that could well evolve into a major financial impact if angry customers begin canceling bookings. One of the goals of effective crisis management is to prevent the “mutation” of one type of crisis into another – to keep an operational crisis from becoming a life safety & security, reputational or financial crisis, for instance. The other goal of effective crisis management is the most important one: to enable your organization to manage through the crisis and emerge from it in a position to continue achieving its business strategy. This requires that you be able to make timely and effective management decisions during the crisis. Understand what happens in a crisis In the early stages of almost every crisis, an Information Gap occurs: there is never enough information available. To make matters worse, much of the information that first comes in will be wrong. Most people instinctively respond to this phenomenon in one of two ways:
Shortly afterwards, you may experience an Information Glut – finding yourself overwhelmed by information, almost all of which is irrelevant or inaccurate. You must be able to rapidly sort through the information, identifying and interpreting data that is both relevant and accurate. Finally, how to make timely decisions without all the facts Crisis is overwhelming. To successfully lead through a crisis, you must make it not so. Like any overwhelming challenge, break your crisis into bite-sized bits. Focus your first decisions on containment – taking immediate action to prevent the situation from getting worse. You don’t have to solve the entire crisis right away. First, you have to keep it from getting worse and buy yourself some time to assess the situation in more detail and then make situation-specific plans to resolve it. The best way to accomplish this in the heat of moment is to follow a crisis management framework that will guide you through the various stages of the crisis. There are five stages to every crisis management effort and we recommend an approach called the CAPER Crisis Management Framework. CAPER is an acronym designed to help you remember a simple five stage process to manage through any crisis. 1. Containment – Take immediate action to prevent the situation from growing worse. This buys you time to develop accurate information about the crisis and assess it properly. In a crisis, people respond by instinct. Unless you can afford to practice immediate actions to the point they become instinctive (as military and emergency services professionals do) you should design these procedures to be as close as possible to routine daily operating procedures. This stage typically includes measures such as:
2. Assessment – each crisis is unique and, therefore, requires a unique solution. It is important to build into your crisis management process a capability to make accurate on-the-fly assessments of evolving situations. This means assigning responsibilities for gathering information, creating reliable procedures to pass information to decision-makers and training people to interpret it accurately. This may involve:
3. Planning – because each crisis requires a unique solution, it is important to develop your team’s ability to make quick, effective plans based on evolving information. This means identifying people with this competency, training them to work in a dynamic environment and practicing plan development and approval procedures that will work in a crisis. During a crisis, this may include:
4. Execution – in any crisis, you must be able to execute your plans effectively. This task is much easier if you have a strong, high-performance team in place before the crisis. Great teams bend with the wind and are amazingly resilient in a crisis. Effective training and development to build a leadership culture, depth of talent and a sense of teamwork in your organization is invaluable. During a crisis, remember:
5. Reorganization and Recovery – as the crisis winds down, it is important to return your organization to normal operations as efficiently as possible, and to refresh any consumables used in the crisis. The next crisis could occur at any time. Great organizations also learn from their experience, so your crisis management process should include procedures for an “after action review” to discuss what worked, what didn’t and to improve your ability to manage the next crisis.
About the Author
© 2007 TOWHEY Consulting Group Inc. All rights reserved. For reprint permission contact info@towhey.com.
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Mark Towhey is an internationally-respected expert in integrated issues, risk and crisis leadership who has successfully led organizations through crises ranging from wild fires in the minefields of the Middle East to riots and hostage takings in Africa and front-page corporate scandals in North America. He founded TOWHEY Consulting Group Inc. in 1998 to help high performance organizations become stronger and more resilient to major crisis. With teams in Toronto and Miami – and an extended global network of strategic partners in the Americas, Europe, the Middle East, Africa and Asia – Mark can be reached at 