Best Practice Crisis And Issues Management A Recommended Approach By SMC


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Best practice approach to a severe crisis or issue, partcularly for corproate organisations - an approach by Saunders-McDermott Consulting

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Best Practice Crisis And Issues Management A Recommended Approach By SMC

  1. 1. Crisis/Issues Management Best Practice
  2. 2. What is a Crisis? A crisis can be defined as: 1. Any unplanned event, occurrence or sequence of events that has a specific undesirable consequence 2. Crises do not make appointments. They can occur at any time and under the most unfavourable circumstances
  3. 3. Main Causes of Crises 1. Acts of God 2. Management Decisions/Indecisions 3. Operational or Mechanical Problems 4. Human Error
  4. 4. Origins of Crises Based on data from the Institute of Crisis Management Management 63% Employee 22% Other 14%
  5. 5. Different Types of Crises Based on data from the Institute of Crisis Management White Crime 19% Labor Dispute 14% Mismanagement 23% Recalls 7% Catastrophe 14% Environmental 7% Other 22%
  6. 6. Examples of Crises Fatality/multiple injuries Natural disaster Terrorism Loss of site Fire/explosion Recall of a product due to a consumer death Recall of major product line Contamination of a major product line Tampering of a major product line Health threat/issues Major plant/asset damage
  7. 7. Examples of Crises Transport/accident (road/rail/air/sea) Extortion/sabotage Armed hold-up Loss of utilities Industrial dispute Workplace violence Environmental pollution Corporate scandal/issues Special interest group action/protest Investigative media
  8. 8. How are Crises Categorised? The most commonly used terms to categorise a crisis are: 1. Insignificant Event 2. Minor Event 3. Moderate Event 4. Major Event 5. Critical/Catastrophic Event
  9. 9. How are Crises Categorised? 1. Insignificant Event What is it? – a minor incident or problem or other internal event which can be handled by Head Office, the Business Unit or Site Personnel using standard operating procedures What are its consequences? – it is not visible offsite, requires no external emergency services input and requires no reports to be filed with local, State or Federal regulatory authorities How is it reported and managed? – along normal line management and reporting lines
  10. 10. How are Crises Categorised? 2. Minor Event What is it? – minor incident that doesn’t breach Regulations or involve a lost time injury. It may be an external event that doesn’t pose a direct threat What are its consequences? – it may require a report to outside agencies but requires no assistance or protective actions by external personnel. Has the potential for low financial loss and involves no serious injuries How is it reported and managed? – by the site Crisis Management Team or local response team only
  11. 11. How are Crises Categorised? 3. Moderate Event What is it? – incident or event that could escalate to a more serious crisis and/or affect operations What are its consequences? – it’s an incident that’s not under control but doesn’t pose a threat to off-site areas. May require a response from external as well as internal personnel. Can be contained in-house and has the potential for a medium financial loss How is it reported and managed? – by the Site Crisis Management Team, the Business Unit management and Corporate Officer of the day
  12. 12. How are Crises Categorised? 4. Major Event What is it? – serious event that has occurred or is imminent which poses a potential threat to employees, customers, the public or third parties. Also has the potential to seriously disrupt operations by interrupting supply but not on a significant cross-product scale What are its consequences? - is a crisis that is not under control and requires action by off-site personnel. It has the potential for a major financial loss How is it reported and managed? – by the Site Crisis Team, Business Unit Management and Corporate Officer of the day
  13. 13. How are Crises Categorised? 5. Critical/Catastrophic Event What is it? – serious event that has occurred or is imminent which is having a detrimental off-site effect. Also poses a serious threat to employees, customers, the public or third parties. Has seriously disrupted operations and supply on a significant cross-product scale What are its consequences? – is not under control and needs significant/immediate actions and assistance from external personnel and emergency services. Strong likelihood of fatalities and a huge financial loss How is it reported and managed? – full Crisis Management Team plus activation of site-wide Crisis Management and Emergency Response plans
  14. 14. Importance of Planning Crisis Management – deals with crises which are often caused by ineffective issues management
  15. 15. Crisis Management in Context Strategic & Financial Plans Risk Review & Analysis Business Continuity Plan
  16. 16. Crisis Management in Context Business Continuity Plan (Protect) Risk Crisis Disaster Management Management Recovery (Prevention) (Cure) (Mop-Up)
  17. 17. Effective Crisis Management 1. First two hours are critical – need to assess the situation and then take control 2. Need to identify, verify and communicate the facts – in an authoritative, clear, unemotional, rational manner 3. Activate Crisis Management Plan - should be a seamless process 4. Focus on outcomes – turn negatives, at best, into positives or, at worst, into neutrals
  18. 18. Effective Crisis Management 1. Coordination 2. Workable guidelines 3. Consistent risk matrix 4. One page checklist/ decision tree 5. Pocket sized manuals 6. Wallet cards
  19. 19. Activate Key Communicators & Support Person Prepare Crisis Statement - On Standby (via email and SMS) - for Internal Release Key Communicators & Support Person Crisis Statement for Internal Release - Confirm With Each Other Activation - Signed Off Key Communicators & Support Person -Confirm Activation at Each Location Initial Employee Communications - Released to Key Communicators Communications Team Person Key Communicators & Team who confirms - Gather Everyone at Location activation is deemed Key Communications Takes Place Communicator Key Communicators Advise Communications Team that Initial Communications Complete Crisis Statement Posted on Next Update Prepared with Instructions Intranet/Notice Boards for Following Communications
  20. 20. Effective Crisis Management Managing Director (and Board) Code Red Team Leader Deputy Code Red Leader Administration Coordinator Specialist Business Advisers Operational Crisis Team Leader Code Red Communications (if required) Leader MELERONICHELE PTY LTD
  21. 21. Incident Driven Issues Driven Incident Occurs Issue Arises Steps Taken to Mitigate & Manage Issue Situation Escalates Local Incident Response General Manager Plans Activated Notified Responsible for Relaying Initial Information that a Operational Crisis Team Significant Event or Situation is in Progress Leader Appointed Advises Group Manager Advisers Group General External Affairs Manager or Group Manager Advisers Managing Director Managing Director Declares Code Red Code Red Team Leader Appointed Code Red Team Leader Mobilises Code Red Team
  22. 22. Role of Crisis Management Plan 1. To establish necessary, agreed, company wide as well as BU/line area controls 2. To ensure alignment with business objectives 3. To create and ensure a consistent approach 4. To provide reassurance and keep key stakeholders informed 5. To marshal vital internal and external resources
  23. 23. What is a Crisis Management Plan? 1. Risk Management Plan - Prevention Embraces all aspects of a company’s strategic & operational areas. Includes concepts of business resilience and long-term performance 2. Crisis Management Plan – Cure Documents all key resources, infrastructure, tasks and responsibilities required to support critical business functions in the event of a disruption 3. Disaster Recovery Plan – Mop-up Documents key resources, infrastructure & processes to facilitate an immediate or staged return to normal/improved capability & performance
  24. 24. What’s in a Crisis Management Plan? 1. Executive Summary  Why, How, What, When & Where 2. Type of Crisis  Insignificant, Minor, Moderate, Major, Critical 3. Threat & Response  Product Recall, Contamination, Tampering, Fatality/Critical Injury, Fire/Explosion, Plant/Asset Damage, Health Threat/Issue, Workplace Violence, Loss of Site, Transport Accident (Road/Rail), Extortion, Sabotage, Industrial Dispute, Bomb Threat, Loss of Utilities, Natural Disaster, Protests (by special interest groups), Environmental Disaster/Pollution, Fraud, Corporate Scandal/Issue, Investigative Media
  25. 25. What’s in a Crisis Management Plan? 4. Roles and Responsibilities  Team & Individual, Senior Management, Crisis Team, Line Managers, All Employees 5. Central Control  Where, when, how – access to key resources 6. Procedures  Event specific checklists, what to do when
  26. 26. What’s in a Crisis Management Plan? 7. Communications  Internal & External (media, employees, regulators, next of kin) 8. Templates  For key documents & communications tools 9. Directory  Key contacts – 24x7 access numbers (internal & external contacts)
  27. 27. First 2 Hours Crisis Checklist 1. Assess situation/gather facts – who, what, when, where, how – use crisis information sheet/checklist 2. Notify key control points – line/BU manager, Crisis Management Team Leader, Corporate Affairs, Senior Executives 3. Notify authorities/emergency services – if necessary activate Emergency Response Plan 4. Crisis Management Team Leader/ control point categorises risk – using Australian Standards Crisis/Risk Matrix 5. Activate Crisis Management Plan - level of activation will depend on type of crisis 6. Assemble Crisis Team - confirm details, roles & responsibilities, required resources, timeframes, deliverables (as per Crisis Management Plan)
  28. 28. First 2 Hours Crisis Checklist 6. Prepare key messages – must be relevant to stakeholders, once approved (by Executive & Legal teams) distribute to key contact points (eg consumer advisory, corporate affairs, customer service operators) 7. Brief spokespeople – rehearse, provide detailed support Q&A, all materials are working documents to be updated as the crisis evolves 8. Communicate with stakeholders – in priority order, consistent use of key messages – deal with questions effectively 9. Complete initial reports – ensure compliance with legal/government regulations 10. Continue to implement Crisis Management Plan
  29. 29. What Else Must Be Done Issues Management – helps avoid crises by anticipating and then mitigating specific situations / developments
  30. 30. Issues Management in Context Issues Management (Anticipate) Issues Information Evaluation & Training & Management Sharing & Issues Kit Management Support Framework Feedback Crisis Management (Cure)
  31. 31. Best Practice Issues Management 1. Issues Management Framework – that forms part of your day-to-day corporate communications and risk management activities 2. Information Sharing & Feedback - from all areas of the business at all levels, work with the Risk Management team to ensure all key issues are covered 3. Issues Kit – distributed to all key spokespeople and employees with a customer-interface role – update the kit on a regular basis to ensure your key issues are up-to-date and your management is effective
  32. 32. Best Practice Issues Management 4. Evaluation & Measurement - against best practice benchmarks and Australian Standards, build into KPIs where possible 5. Training & Support – to key spokespeople and customer facing employees eg workshops, case studies, simulated testing. Key areas to consider include: - Media Training - How to Use an Issues Kit - Dealing with Difficult Customers - Simulated Product Recalls (desktop and company wide level)
  33. 33. What’s in an Issues Management Kit? 1. Executive Summary  Why, how, what, when and where 2. Type of Issues  Across all areas of the business 3. Roles and Responsibilities  Key spokespeople, customer interfacing employees, communications team 4. Key Issues  What, why, context, possible impact
  34. 34. What’s in an Issues Management Kit? 5. Mitigating Actions  Procedures and policies to prevent issues from becoming a reality 6. Detailed Q&As  To deal with queries, concerns, questions from stakeholders in the event issues become a reality, can be fed into Customer Services Team as a call centre script 7. Updating and Review Procedures  To ensure the Kit remains up-to-date and current at all times, effective system for issuing updated information to users of the Kit
  35. 35. Key External Stakeholders 1. Customers 2. Shareholders 3. Investment Market 4. Media 5. Suppliers 6. Competitors 7. Regulators/Government 8. Emergency Response Services
  36. 36. Key External Stakeholders 1. Executives • Senior Management Team • Crisis Management Team • Risk Management Team • Corporate/Public Affairs/Communications Teams 2. Other Employees • Business Units • Sales and merchandising team • Front line/customer facing employees • Customer Service teams
  37. 37. Seven Steps to Success 1. Predict – anticipate everything that could go wrong with your organisation, identify the key issues, review and update them regularly 2. Position – decide what your position will be on each issue 3. Prevent – take preventative measures to ensure your issues don’t become a crisis, develop management and mitigation strategies 4. Plan – in case prevention doesn’t work, prepare a plan for dealing with a crisis
  38. 38. Seven Steps to Success 5. Rehearse – review your crisis and issue plans, update them as necessary, undertake simulation testing to ensure your crisis plan is robust and effective 6. Persevere – follow your plans, stick to the positions you’ve taken, strictly implement your crisis and issues management policies and procedures 7. Evaluate – review your crisis and issues management performance on a regular basis, focus on continuous improvement, benchmark against Australian Standard/global developments
  39. 39. And That Success is…. 1. Protection – of your employees, customers, the general public, third parties and local communities 2. Reduction – in terms of your potential for litigation 3. Retention – of the support from your key stakeholders 4. Protection – of your corporate reputation and brands 5. Continuation – of a commercially viable business delivering a strong financial performance 6. Protection – of your market share, sales and customer loyalty 7. Compliance - with all the relevant government and legal requirements