Crisis always comes when you least expect them to. This is why it is important to prepare your organization for them in advance. Inaction is unforgivable. In order to successfully overcome a crisis, your organization will need to come up with a plan to protect itself. We lay out the ways you can plan for crisis management for your business.
What Is Crisis Management?
Crisis management refers to a set of processes that your organization has put in place to deal with unexpected negative situations. This is crucial as your brand’s reputation is at risk if the crisis is managed poorly.
Any business is at risk of facing bad publicity when facing a crisis. This is why quick action needs to be taken once a crisis hits. With digital media, news travels fast which means you have little time to plan your next course of action. Thus, it is essential for you to plan for the best course of action while things are looking good.
Types of Crisis
As mentioned, a crisis is absolutely unpredictable. But, there are some common categories that a crisis may fall into.
1. Financial Crisis
Financial crisis can refer to bankruptcy. This usually happens when a business loses value in its assets and the company is unable to pay off its debts.
For example, in 2005, Delta Airlines filed for bankruptcy due to the fall in customer demand. The fall in customer demand started from the September 11 2001 attack and continued to the mid-2000s. Fortunately for Delta Airlines, it managed to overcome the financial crisis in 2007.
2. Staff Crisis
Drastic changes to company personnel may affect the company operations. This could be due to forced employee furlough.
For example, the Covid-19 pandemic brought a lot of woes to many companies. Constant changes to governmental policies and social distancing practices have affected businesses who were unable to keep up with the changes. Sudden layoffs like this can lead to bad optics for the company, especially when employees head online to vent their frustrations.
3. Organizational Crisis
No organization is perfect. However, organizational crises are situations where the company has greatly wronged their consumers or employees due to poor organizational practices.
For example, in 2020, Google faced accusations of spying on its employees and not supporting worker unions. To overcome this PR disaster, Google released a statement to reassure the public that they are taking good care of their employee’s needs.
4. Natural Disaster Crisis
Natural disaster crisis is something that only Mother Nature can control. If your business is at risk of being exposed to extreme-weather conditions, prepare an emergency response plan for the safety of your staff and consumers.
Recently, the Covid-19 has directly impacted a lot of businesses, Many companies had to make the quick pivot to remote working conditions. Additionally, health and safe distancing protocols have to be established quickly to keep employees and customers safe.
5. Technological Crisis
With businesses being heavily reliant on technology for their daily operations, a technological crisis can be a very serious disaster. Crisis could range from a website server crashing and customers being unable to shop online to user data being leaked due to malware or hackers. While both are serious issues, the severity of the latter is massive. In this case, prevention is always better. Work together with your IT team to bolster your digital security.
Crisis Management Strategies
Respond In A Timely Manner
When a crisis strikes, be the first to respond and issue a public statement. Your employees and customers want to hear from you directly. There is nothing worse than being updated on news from a different source.
Have a plan of action and make sure that the people responsible to execute it are able to do so. Always have a Plan B for your plan of action. Communicate with your stakeholders, and stay responsive to your customers. Be transparent if you are unable to provide them with an answer at that point in time. Once you have come up with a solution, communicate that to your stakeholders and customers as well.
Be Proactive
Proactive crisis management is one where you were able to anticipate and prepare for a potential crisis. This is difficult to do but for some crises active management is important. This is particularly for the natural disaster, or even the technological crisis. In a natural disaster situation, usually you will be given some warning before the disaster hits. Take this time to usher your employees and customers to safety. For the technological crisis, work together with your IT team to actively monitor to keep your defences up and your website secure.
Recover With Grace
Sometimes not all crises can be prevented and businesses are left to recover from the damage. Such blindsides can cause long-term negative impact to the business. Crises like this usually involve technological or personnel crises. In this case, the best course of action for businesses is to accept accountability for the damages. Start with issuing a genuine public apology and work towards finding out what caused the incident and ways to prevent or overcome it.
Conclusion
Be proactive about your crisis management strategies. Imagine all possible scenarios and work on the ways the business can handle them efficiently. Communicate these strategies with your team and even spend some time roleplaying so each person knows the role they have to play. This way, your business will be more prepared to deal with a crisis situation while maintaining the reputation and upholding an excellent customer experience.
