Crisis management


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Crisis management

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Crisis management

  1. 1. CRISIS MANAGEMENT Eng.Ahmed Ali El-Kosairy
  2. 2. Crisis Management Crisis management is the process by which an organization deals with a major unpredictable event that threatens to harm the organization, its stakeholders, or the general public
  3. 3. Elements of a Crisis Three elements are common to most definitions of crisis: (a)a threat to the organization, (b) the element of surprise, (c)a short decision time
  4. 4. Elements of a Crisis • Crisis management & risk management • In contrast to risk management, which involves assessing potential threats and finding the best ways to avoid those threats, crisis management involves dealing with threats before, during, and after they have occurred. It is a discipline within the broader context of management consisting of skills and techniques required to identify, assess, understand, and cope with a serious situation, especially from the moment it first occurs to the point that recovery procedures start
  5. 5. Crisis management - 1 Crisis management consists of: • Methods used to respond to both the reality and perception of crises • Establishing metrics to define what scenarios constitute a crisis and should consequently trigger the necessary response mechanisms. • Communication that occurs within the response phase of emergency management scenarios
  6. 6. Crisis Management - 2 The credibility and reputation of organizations is heavily influenced by the perception of their responses during crisis situations
  7. 7. Crisis Management - 3 * respond to a crisis in a timely fashion makes for a challenge in businesses. * must be open and consistent communication throughout the hierarchy to contribute to a successful crisis communication process.
  8. 8. Types of Crises • Natural disasters // fires,earthquakes, volcanic eruptions, tornadoes and hurricanes, floods, tsunamis, storms, etc... • Technical breakdowns // IPS , Microsoft • Human breakdowns // employees • Challenges // ww2 England , USA • Organizational misdeeds • Rumors // P&G Procter & Gamble logo, Intelligences
  9. 9. P&G Crisis Products: Camay Gillette Head & Shoulders Herbal Essences Pantene Pert Plus Ariel Bonux Braun Downy Tide
  10. 10. Crisis Management Crisis management model - Gonzalez-Herrero and Pratt 95 There are 3 phases in any Crisis Management as shown below : 1)The diagnosis of the Crisis or the danger signals. 2)Choosing appropriate Turnaround Strategy. 3)Implementation of the change process and its monitoring.
  11. 11. Crisis Management Crises of organizational misdeeds - when management takes actions it knows will harm or place stakeholders at risk for harm without precautions
  12. 12. Crisis Management Types of crises of organizational misdeeds: - crises of deception - crises of management .
  13. 13. Contingency Planning a plan devised for an outcome other than in the usual (expected) plan. when an exceptional risk that, though unlikely, would have catastrophic consequences. Example: “suppose many employees of a company are traveling together on an aircraft which crashes, killing all aboard.” The plan may also include standing policies to mitigate a disaster's potential impact.
  14. 14. TOYOTA – CRISIS MANAGEMENT FAILURE Toyota’s communication strategy: “Too little, too late” Beyond the quality problem Toyota mismanaged the crisis
  15. 15. TOYOTA Basic Rules Violated • For senior mgmt: crises must become their #1 priority immediately. • Sticking accelerators in 2008 - not treated as a serious matter
  16. 16. TOYOTA Basic Rules violated Find facts & solutions fast: - Toyota managers at first in denial - accepted a ‘patch’ (remove floor mats), not solution - when crisis exploded -- engineering solution/stopped production - Even today no one outside of Toyota knows what the real problems are – open to speculation and rumors
  17. 17. TOYOTA Basic rules violated Communicate fully and accurately: - to all constituents to sustain trust - maintain trust with a recall What Toyota did: hushed problem and hoped it go away