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1. Chapter 11. Ethical Crisis Leadership
Crisis: An Overview
 A crisis is any major unanticipated event that poses a
significant threat.
 Such events are rare (making them difficult to prepare for),
they generate a good deal of uncertainty (their causes and
effects are unclear), and they are hard to resolve (there is no
set formula for determining how to act).
 Decisions about how to deal with the crisis need to be
handled quickly.
© 2015 SAGE Publications, Inc.

2. Crisis: An Overview
Crisis management
experts Matthew Seeger,
Timothy Sellnow, and
Robert Ulmer identify
ten types of crisis.
 1. Public perception
 2. Natural disasters
 3. Product or service
 4. Terrorist attacks
 5. Economic
 6. Human resource
 7. Industrial
 8. Oil and chemical spills
 9. Transportation
 10. Outside environment
© 2015 SAGE Publications, Inc.

3. The 3 Stages of a Crisis
Stage 1. Precrisis
 Precrisis is the period of normalcy between crisis events.
 During this, the longest phase, the group or organization
typically believes that it understands the risks it faces and can
handle any contingency that arises.
 Barriers to crisis prevention include:
 Complacency
 Human biases
 Institutional failures
 Special interest groups
© 2015 SAGE Publications, Inc.

4. Precrisis Stage
5 Crisis Myths that are debunked:
 Myth 1: “Crises are Inevitable.”
 Myth 2: “We Lack the Basic Knowledge to Prevent or
Understand Crises.”
 Myth 3: “Better Technology Will Prevent Future Crises.”
 Myth 4: “Crisis Management Is Inherently Detrimental
to Progress.”
 Myth 5: “Emotions Have No Place in Crisis
Management.”
© 2015 SAGE Publications, Inc.

5. The 3 Stages of a Crisis
Stage 2: Crisis Event
 The second stage commences with a “trigger event.”
 It ends when the crisis is resolved.
 Ethical leaders play a critical role during this stage.
 Leaders are also responsible for speaking on behalf of the
organization.
 Those directly impacted by the crisis have particularly
important information needs and should take top
priority.
© 2015 SAGE Publications, Inc.

6. The 3 Stages of a Crisis
Stage 3: Postcrisis
 Investigation and analysis take place during the third and final
stage.
 This is also a period of recovery where ethical leaders try to
salvage the legitimacy of the group or organization, help group
members learn from the crisis experience, and promote
healing.
 Organizational crisis learning takes three forms.
 Retrospective sensemaking
 Reconsidering structure
 Vicarious learning
© 2015 SAGE Publications, Inc.

7. Box 11.3: Crisis Leadership Competencies
Additional competencies
to navigating each crisis
phase:
Precrisis:
 Sense making
 Perspective taking
 Issue selling
 Organizational agility
 Creativity
Crisis Event
 Decision making under
pressure
 Communicating
effectively
 Risk taking
Post Crisis
 Promoting organizational
resiliency
 Acting with integrity
 Learning orientation
© 2015 SAGE Publications, Inc.

8. Components of Ethical Crisis Management
Assume Broad Responsibility
 Responsibility is the foundation of ethical crisis leadership.
 Preventing, managing, and recovering from crises all
depend on the willingness of leaders and followers to accept
their moral responsibilities.
 In addition to engaging in, and fostering, ethical behavior,
the responsible crisis leader fights against complacency,
human biases, institutional weaknesses, special-interest
groups, and other obstacles to crisis prevention.
© 2015 SAGE Publications, Inc.

9. Components of Ethical Crisis Management
Practice Transparency
 Like responsibility, transparency is another requirement
placed on groups and organizations operating freely in
society.
 Failure to disclose information spawns abuses of power and
privilege and makes it impossible for individuals to act as
informed members of the community.
 Transparency begins with openness.
 Transparency also involves symmetry.
© 2015 SAGE Publications, Inc.

10. Practice Transparency
Maintaining transparency is particularly difficult when a crisis is
triggered.
 First, there are privacy concerns.
 Second, admitting fault can put the organization at a disadvantage
in case of a lawsuit.
 Third, there may be proprietary information about, say,
manufacturing processes and recipes, which should not be
released to competitors.
 Fourth, uncertainty makes it difficult for an organization to
determine what its course of action should be, and, as a result, to
communicate concrete details to the public.
 Fifth, being specific may offend some stakeholders who feel that
they have been treated unfairly.
 Sixth, making a commitment to a single course of action too soon
may limit the group’s ability to deal with the crisis.
© 2015 SAGE Publications, Inc.

11. Practice Transparency
Some observers suggest that leaders in a crisis situation use
strategic ambiguity as an alternative to transparency. In
strategic ambiguity, communicators are deliberately vague,
which allows them to appeal to multiple audiences.
More often than not, however, strategic ambiguity is
unethical, used to shift the blame and to confuse
stakeholders while providing them with biased and/ or
incomplete information.
While the amount and type of information to be shared will
vary with each crisis, the goal should always be to be as
open as possible.
© 2015 SAGE Publications, Inc.

12. Practice Transparency
In order to be ethical, the group’s explanation of events and
response to public criticism must have the right manner
and content.
Manner refers to the form of the communication, which
needs to:
 (1) be truthful
 (2) be sincere
 (3) be timely
 (4) be voluntary
 (5) address all stakeholders
 (6) be in the proper context
© 2015 SAGE Publications, Inc.

13. Practice Transparency
The content of the message is just as important as the form
it takes. The ethical story of events:
 clearly acknowledges wrongdoing;
 accepts full responsibility for what happened;
 expresses regret for the offense, the harm done, and failure
to carry out responsibilities;
 identifies with the injured
 asks for forgiveness;
 seeks reconciliation with injured parties;
 fully discloses information related to the offense;
 offers to carry out appropriate corrective action; and
 offers appropriate compensation.
© 2015 SAGE Publications, Inc.

14. Demonstrate Care
Demonstrating concern has practical as well as ethical
benefits.
While it is in the interest of leaders and organizations to act
in a compassionate manner for image and financial
reasons, it is even more important to do so for ethical
reasons.
 i.e. Altruism
Showing concern during a crisis goes well beyond
addressing the physical and financial needs of victims.
 Emotional and spiritual needs as well
© 2015 SAGE Publications, Inc.

15. Leadership Ethics at the Movies: Argo
Discussion Questions:
 How would you evaluate the crisis preparedness
of the embassy staff?
 2.What risks did the Canadian ambassador, his
staff and the Canadian government face in
harboring the fugitives?
 3.What components of ethical crisis management
and what crisis leadership skills do you see in the
story of the rescue of the six Americans?
© 2015 SAGE Publications, Inc.

16. Rational thought, problem solving, and other
cognitive skills and strategies are important
complements to care and compassion in ethical crisis
management.
Moral leaders respond with their heads as well as
their hearts.
Ethical crisis leaders, in addition to paying heedful
attention themselves create mindful cultures.
Engage the Head as Well as the Heart
© 2015 SAGE Publications, Inc.

17. Engage the Head as Well as the Heart
Aircraft carrier example
Navy leaders encourage five mindful practices:
 Carrier crews are preoccupied with failure.
 Those who work on carriers are reluctant to simplify.
 Third, carrier crews sustain continuous sensitivity to
operations.
 Fourth, people on carriers share a commitment to
resilience.
 Fifth, carrier personnel demonstrate deference to expertise.
© 2015 SAGE Publications, Inc.

18. Engage the Heart as Well as the Head
Leaders responding to crises also need to employ
ethical rationality.
Rationality is defined as “a firm’s ability to make
decisions based on comprehensive information and
analysis.”
Ethical rationality serves firms well in crisis
management. Ethically rational companies (and
nonprofits) are more likely to make sound moral
choices during a crisis because leaders are in the
practice of incorporating ethical principles into
routine decision making.
© 2015 SAGE Publications, Inc.

19. Focus on Follower Ethics: Whistle Blowing
Key ethical tension points
in whistle-blowing
 What is our obligation to
the organization?
 What are our moral
obligations to colleagues
in the organization?
 What are our ethical
obligations to our
profession?
 Will the act of whistle-
blowing adversely affect
our families and others
close to us?
 What moral obligation do
we have to ourselves?
 What is our ethical
obligation toward the
general public?
 How will my action affect
important values such as
freedom of expression,
truthfulness, courage,
justice, cooperativeness,
and loyalty?
© 2015 SAGE Publications, Inc.

20. Improvise From a Strong Moral Foundation
The ability to ethically improvise is critical in a crisis
because no amount of planning and practice can
totally equip individuals for the specific challenges
they will face during the crisis event.
Successful improvisation requires that employees be
empowered to act on their own initiative.
© 2015 SAGE Publications, Inc.

21. Case Study: The Terrorist and the Time Bomb
Discussion Questions:
 Do you believe that extreme measures like killing
civilians and interrogational torture are ever
justified? Why or why not?
© 2015 SAGE Publications, Inc.

22. Case Study: Deadly Prank Call
Discussion Questions:
 What warning signs were
ignored in this crisis?
 Was it ethical for the DJs to
make a prank call to a
hospital? Should all prank
calls be banned?
 Would you evaluate the
prank call differently if it
hadn’t resulted in the death
of a nurse? Why or why not?
 How much blame should be
assigned to the DJs, to the
station, and to the hospital
for what happened?
 How would you evaluate the
crisis response of the
Southern Cross Austereo?
What did it do right?
Wrong?
 What steps should Southern
Cross Austereo take to
restore the firm’s reputation
and that of station
2DayFM?
© 2015 SAGE Publications, Inc.

23. Case Study: Long Island Port Authority
Discussion Questions:
 Why do you think officials at LIPA ignored the advice of
experts?
 Can you think of other organizations that are unprepared for
crisis? What characteristics do they share with LIPA?
 What steps do leaders need to take to better prepare LIPA for
future disasters? What obstacles could they face as they take
these actions?
 Should the utility be held legally liable for damages done to
those who lost power?
 Can LIPA be saved or should it be converted into a private
utility?
© 2015 SAGE Publications, Inc.