Friday, December 20, 2013

A Leader's Guide To Crisis Management


"From Tylenol's textbook handling of product tampering to Toyota's troublesome automobile recalls, how a company recovers from crisis can mean continued business success or bankruptcy," explains author Jim Moorhead.

In his book, The Instant Survivor -- Right Ways to Respond When Things Go Wrong, Moorhead presents a four-step, crisis survival kit to show leaders how to weather professional, and personal, crises.

He explains that a company's ideal crisis management team does the following when a crisis occurs:
  • Review their crisis management plan and talk through the company's business, communications, and legal goals.
  • Identify the risks and opportunities the crisis presents and analyze the options to consider, the people and resources to deploy, and the allies and experts to call upon.
  • Debate, argue, and finally agree on a strategy to implement.
  • Stay in constant contact to gauge how they're doing and make adjustments as the crisis unfolds.
  • Look for how to be stronger after the crisis abates.
And during a crisis, Moorhead says a leader must stay visible. "Think about why it's so reassuring when a leader stays visible during a calamity. A leader demonstrates psychological strength, control over events, and focus on a solution. A leader secures support through the courage he or she demonstrates," explains Moorhead.

Recently, Moorhead answered these questions for me:

Question: How best should a junior level executive in a company convince a reluctant CEO or President to have a crisis management plan?

Moorhead
: I would suggest that the junior level executive ask a series of questions, with varying degrees of intensity depending on the relationship such as:
  • Do you think our competitors have crisis management plans?
  • Why do you think so many Fortune 500 companies have chosen to have them?
  • Do you think the expense involved in having a plan would be worth it if we have a crisis?
  • How would we explain to the Board that we didn't have a written plan if there's a crisis?
  • Did you notice what bad press one of the oil companies got for having what was regarded as an out-of-date plan?
If the junior executive makes some progress, I suggest she/he offer to contact some law firms and crisis and public relations firms that can describe the basic features of a plan and help draft one.

Of course, a plan that rests on the shelf without any type of training including crisis simulations is often of limited value, but having a written crisis management plan is an essential first step for any organization.

Question: How has Social Media (particularly Twitter and Facebook) changed the dynamics a company faces today during a crisis versus pre-Social Media times?

Moorhead: Have you ever played an advanced level video game? Sometimes the beginner level is manageable, but most players struggle at the advanced level. The Social Media surge has moved all companies to the advanced level, where the communication speed is blinding, the potential number of bloggers and other commentators limitless and the needs of each channel different (Twitter versus Facebook).

Done well, Social Media presents a huge opportunity for tuned-in, nimble companies to interact in real time with their customers and other constituencies, to spot and address trouble in its infancy and to build loyal followers based on credible promises made and kept.

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