What Is Crisis Management?
A textbook might define crisis management as the following:
“The art of dealing with sudden and unexpected events which disturb the employees and organization, as well as external clients.” – Management Study Guide
Unfortunately, not everything is quite as simple as a clean-cut textbook definition. If you were to assign elements of real life to what necessitates crisis management, they would be something like: jackhammers at a construction site, sirens going off, too many exclamation points in a text message (or confetti emojis for that matter), a tie-dye shirt, a mosh pit – I’ll stop here, in case you are already starting to get tense. Plus, I think I’ve made my point.
Crisis management experts step in to the most seemingly stressful of situations, in which everything appears to be out of control. A crisis is defined as any emergency situation that leads to instability within a business. A crisis management expert will bring stability with ease, and help to restore trust to management from employees, clients and investors.
Crisis management personnel may already exist within a business structure, but because a crisis is characteristically unexpected, it is difficult to prepare appropriately and adequately.
Don’t Make Excuses
Statistics point out that reasons management offer to avoid the practice of crisis management vary. They mostly center around the issues of cost.
59% of business decision makers have experienced a crisis in their current or previous company.
Sure, it may only be a 50/50 shot, but do you really want to risk those odds? With an increase in social media use and the liberties the internet provides in general, a crisis can constitute the following:
- Controversial company development
- Online or digital security failure
- Logistic difficulties
- Intense regulatory scrutiny of your product or company
- Critical or negative new media campaigns
- Danger to product safety
- Technical accidents
- Intense political scrutiny of your product or company
- Criminal actions
It is important to note that as social media use becomes more prevalent, this can both help and hurt crisis management. Here’s an example.
The Pepsi Parable
Pepsi released a commercial in April of 2017 in which reality TV star Kendall Jenner is shown handing a can of Pepsi to a police offer during a tense human rights protest. With her peace offering she soothes the protest, and the activists and officers go on their merry way.
Backlash to the ad was swift and sure, and, in a tense political climate and on the anniversary of Martin Luther King Jr.’s assassination, was centered around what appeared to minimize the struggle that civil rights activists have faced in the last year and throughout history.
In a statement released the next day, Pepsi said the following: “This is a global ad that reflects people from different walks of life coming together in a spirit of harmony, and we think that’s an important message to convey.”
Pepsi quickly became a trending topic, but for all the wrong reasons.
As swiftly as the statement was released, Pepsi released a second statement, this time in apology.
“Pepsi was trying to project a global message of peace, unity and understanding. Clearly we missed the mark, and we apologize,” Pepsi said in a statement to Associated Press.
From start to finish, the entirety of this crisis took place online and in less than 24 hours. This is becoming more commonplace. The vastness of the online world allows for a wealth of information to spread like never before.
For this reason, it could certainly be considered a risk to forfeit developing a crisis management strategy for the sake of maintaining or cutting costs.
Weigh the Cost
When you purchase insurance, whether it be for health, your vehicle, your apartment, or your home, it is typically with the hope that a catastrophe does not befall you or your property. You know, however, that your investment is wise, because when catastrophes happen, you feel much more secure, less threatened, and can immediately call upon your insurance company to spring into action. Insurance companies exist to make sure you minimize loss when pesky crises descend upon your life.
This is the benefit of a crisis management system in place.
You may be wondering what the benefit of a third party crisis management team is – a team who in theory would know less about the ins and outs of your company, how it operates, what poses the most imminent threats, etc.
To understand this requires a basic understanding of what a crisis management team actually does to combat whatever catastrophe might be on the verge of befalling your business.
An effective crisis management team will do the following:
- Detect the early signs of a crisis
- Identify problem areas
- Sit with employees face to face and discuss identified areas of concern
- Prepare a crisis management plan which works best during emergency situations
- Help the company to come out of tough times with renewed confidence in themselves to face the future.
It is fairly simple for a third party to enter in, gather this information and formulate a plan. Some might argue it is even more beneficial to outsource this process, considering an outside perspective can often offer clarity, objectivity, and intention, while an internal effort might be put to the side due to existing responsibilities or handled with bias that could damage it’s integrity.
Can We Counter Crises?
Not always. The key to preventing and handling any crisis comes down to communication – having all the necessary information communicated is vital to preventing, stopping or addressing a crisis.
A knowledgeable and efficient crisis management team in place to review the concepts that drive press releases, advertisement strategies, public relations initiatives, human resources conflicts, etc. should stop a crisis in it’s tracks.
In most cases, knowledge = efficiency.
While it would be ideal to stop a crisis before it happens, some things can simply not be foreseen. Hand in hand with crisis management is reputation management services, a service that protects and upholds your brand’s reputation among public’s perception. It all comes down to getting you more clients and yes, even employees – studies have shown that 69 percent of jobseekers would turn down an offer from a company with reputation problems, and 31 percent of internet users search a business online before making a purchase from that business.
According to a study by the World Economic Forum, on average, more than 25 percent of a company’s market value is directly attributable to it’s reputation. Don’t risk watching your company’s value plummet because of a crisis – bring in a team of experts and face it head on.
Need help with Crisis Management? We’re happy to help; just click on the link!