What is crisis management?the art of making decisions to mitigate the effects of such an event, often while the event itself is unfolding
making decisions about your institution‟sfuture while you are under stress and while you lack key pieces of information
If you dont prepare, you WILL take more damage
Genesislarge scale industrial and environmentaldisasters in the 1980s
Bophal1984Gas leak at Union Carbide‟ pesticideWorld‟s worst industrial disaster560.000 injuredDow Chemicals
Crisis management consists of:• Methods used to respond to both the reality and perception of crises (crisis management plan)• 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.
Crisis management has four objectives:• Reducing tension during the incident• Demonstrating corporate commitment and expertise• Managing resources effectively• Controlling the flow and accuracy of information
The Crisis Life Cycle• Stage one: The Storm Breaks• Stage two: The Storm Rages• Stage three: The Storm Passes
1- The Breaking Crisis• Control seems to be slipping out of the company.• Lack of solid detail about the crisis. Hard-to- provide information demanded by the media, analysts and others.• Temptation to resort to a short-term focus, to panic and to speculate.• For a period of time, everyone loses perspective.
2- Spread and Intensification of Crisis • Speculation and rumours develop in the absence of hard facts. • Third parties- regulators, scientists and other experts – add weight to the climate of opinion. • Corporate management comes under intense scrutiny from internal and external groups.
3- Rebuilding Needs• To manage reputation. There are opportunities in a crisis to build positive perceptions of the company or product that last beyond the crisis period.• Company communication/ culture. The company embarks on a long-term programme to tackle management issues and communication problems that exacerbated the crisis.
Challenges in Crisis Decision-Making• Surprise and hesitation. The shock of a crisis can create a delay in response that allows your critics and the media to fill the gap with negative comment and speculation CRISIS RESPONSE
Challenges in Crisis Decision-Making• Pressure and stress must be channelled by the discipline of a crisis strategy.
Challenges in Crisis Decision-MakingMistaking information distribution for communication the risk of floor mat entrapment
Challenges in Crisis Decision-Making• Don‟t treat key audiences as “opponents”?
TipsGood communication• is the heart of any crisis management plan• should reduce tension• demonstrate a corporate commitment to correct the problem and take control of the information flow• involves communicating with the media, employees, neighbours, investors, regulators and lawmakers
3 months5 million barrel crude oil$ 20 billion fund
You are the CEO of BP 1. What do you say to the public?2. What do you say to the shareholders? Please write down 2 short statements.
• Social media: – Everywhere, but outnumbered by dissenters – No response to critics• Lack of engagement
• A crisis threatening your company is likely to be discovered by the media today• and may potentially escalate into a media crisis
especially truesocial media crisis
depending on how you handle the communication of the crisis
a crisis• may affect you, by damaging your brand reputation, bring legal actions, internal turmoil, loose shareholders‟ confidence and slash market value or• may benefit you, by providing you visibility
• Most organizations have risk management plans, foreseeing fires, storms, floods and other risk and crisis scenarios• Very few organizations have: – communication strategies – media crisis plans
The most common reasons for management to ignore the warning signs are: - denial that a crisis can happen - belief in the current procedures and - concerns for the effect disclosure may have on the reputation of the organization.
Be aware• The public does not care what turmoil the organisation is in – they want assurances that something is being done and that they are being protected.• Media should not be regarded as the enemy, but as a significant stakeholder that can shape the perceptions of an organisations performance during a crisis.
How to get it right• Bring the news media inside your crisis: – Be proactive, to remain in control – Don‟t talk off the record – Press releases – Collateral materials• Let them watch at close range how you handle the crisis
Be smart• Being inside gives them special knowledge and prestige• The „Stockholm Syndrome‟ takes over• Your organisation must take the time to meet the needs of each media outlet
Tips• Develop a loyal following before a crisis strikes• Leverage the powerful help of your still- loyal customers• Communicate right• CEO shows up