Strategic Crisis Leadership:
What would you do in the following three situations?
Crisis Leadership Moment #1
Imagine that it finally hit! The avian flu has just been confirmed to be contagious. One of your traveling employees has just been diagnosed with this dreaded disease after returning home. Your workforce is fearful that they might have been exposed and most are not personally prepared at home for an outbreak. But, you need them to carry out the company’s business continuity plan. Employees in mass want to take time off. What do you do?
Crisis Leadership Moment #2
You learn that one of your facilities has been emitting low-level toxic substances for an undetermined amount of time. It is the company’s fault due to a prior decision to delay replacement of a faulty system in one of your facilities. But, it is quickly remedied. Possibly, employees, visitors and others have all been exposed to a small degree. Most likely, the exposure was minimal with no harm.
Unfortunately, a similar situation occurred at the same facility last year. You reported it to the authorities and the media, in learning about it, exagerated the story, blaming the company for putting people at risk.
If knowledge of the present toxic emission were unveiled publicly it would likely cause serious reputational and legal damage to your organization, now that it has happened again. But it would be worse if discovered later that you tried to cover it up. Possibly, your position within the company is on the line, as well. Only you and a couple of trusted subordinates know about the emission now. Do you proactively go public and risk the feared personal, reputational and legal damage or try to resolve the situation quietly with (hopefully) no public harm done?
Crisis Leadership Moment #3
Two bombs hit your facilities simultaneously in different locations with a note from an activist group taking credit. Do you close all your facilities throughout the enterprise as a safety precaution? If so, for how long? If not, what are alternative responses?
Each of these situations requires a “defining decision.” Initial information is usually wrong. Rumors are rampant. Action must be taken without time for sufficient consideration. The consequences are high. People are watching your every move. The velocity of information coming in is staggering. The stress is numbing.
Now, make those decisions that may have life and death implications. Act in a manner that will be scrutinized later. Take that risk that may define your career as an excellent leader when the organization needed it most...or an inept manager with poor judgment under pressure.
There are significant differences between Tactical Crisis Management and Strategic Crisis Leadership. The table below gives some of the high level differences:
Strategic Crisis Leadership involves high-leverage skills that are vital to corporate recovery in the midst of a disaster. Crisis leadership skills are needed that define the crisis beyond the obvious, forecast the intended and unintended consequences of decisions, anticipate the effects of the crisis on impacted stakeholders, assess the impact of the crisis on core assets, and follow the values and guiding principles of the organization – and, your own ethical standards that may be tested to the limit.
Crisis leadership is more about who you are than what you know. No learned crisis leadership skill will overcome a lack of character, ethics or integrity. An effective crisis leader must act deliberately, quickly, and effectively with honesty, high moral values and ethical standards.
In order to help assure their leaders will act with good character in a caring manner when crises hit, crisis prepared organizations develop overarching response guidelines for their crisis managers to follow. I provide you with five guiding principles for managing crises:
Be, Know, Do
The U.S. Army defines the three basic components of leadership as Be, Know, Do. “Be” is about who you are. “Know” is about the skills and knowledge you have acquired. And “Do” is about the actions that you take on a timely basis. Purposeful attention to all three components of Strategic Crisis Leadership will increase the likelihood that you’ll know what to ask, what to do and how to do it. And more importantly, learn to manage the unexpected.
Be, know, do...what are the skills needed to meet these Strategic Crisis Leadership responsibilities? There are many. But here is a simple introductory prescription for effective crisis leadership.
What do you need to be? Caring. Demonstration of caring is more important than all other leadership traits combined, according to research by the Center for Risk Communications. If you come across as uncaring, people will become outraged. Caring during crisis response is not a feeling. Caring is a set of corporate and personal behaviors that elicit the perception in impacted stakeholders that you and your company truly care.
What do you need to know? As a leader, you must have a vision for crisis resolution. Without a clear and compelling vision for response and recovery, you will not be able to adequately lead your people during times of crisis.
And do? The single most important action is two-way communication. Simply put, you will never be any better at responding to crises than your communication. That involves how well you listen to obtain the facts, and how well you speak openly to impacted stakeholders.
So, how does this apply to real life situations? I introduced three scenarios at the beginning of this article of dealing with avian flu, people exposed to a toxic substance, and the simultaneous bombing of two facilities by an activist group.
In applying effective crisis leadership principles, I recommend that you look at three rules of thumb to focus your response. First, identify the core assets of the organization that are potentially at risk. Are people in harm’s way? Is there possible damage to your company brand, reputation or shareholder value? Will the ability to deliver goods or services be significantly disrupted? Secondly, identify all stakeholder individuals and groups who are harmed (real or perceived). Do your best to address their needs and concerns. And third, anticipate the potential progression of events and reactions by stakeholders.
With the avian flu scenario, consider first addressing the well being of your most important asset, your people. Provide masks, gloves, and hygiene protocol within the workplace. Get your hands on cash, food and water. If you don’t already have these things, move fast. The early bird gets the worm during crisis management. Once your people are addressed, focus on stakeholders who might need priority attention. It could be customers, or your suppliers and distributors. Prioritize and do what you can to address the needs or concerns of all impacted stakeholders. Those stakeholders that you don’t adequately address will likely be the problem areas. Anticipate their needs by imagining what you would want or expect if you were in their position.
The toxic exposure scenario involves information that is known to you, but not to those who may be at risk. It would be easy for uninvolved advisors to recommend that you come forward immediately and let the chips fall where they may. It’s hard to hide damaging information and is best to follow the guiding principles of taking responsibility in an honest and ethical manner. In general, good crisis management will require protection of the greater good over personal concerns. With that said, there are times in the real world of crisis management when the decision is made to conceal known information. Right or wrong, if the damage of being forthcoming is considered too much to bear, some people will decide not to come forward. If you are tempted to conceal, you must come up with a rationale that will pass the “reasonable person test.” Consider confidentially getting a multidisciplinary group of advisors to discuss your best alternatives. Possibly, a specialist in toxic exposure should be consulted. Anticipate the reactions of people who perceive harm if they learn of your concealment. If you do not feel comfortable defending your rationale on the front page of the newspaper, you are taking a serious risk that could take you and or the company down. Lying and concealing information are two ways to escalate the severity of your crisis. Think: Arthur Andersen, Bill Clinton, and Martha Stewart.
Finally, the scenario of a simultaneous bombing in two work locations was presented. Your employees and customers (if they come onsite) will have the natural fear of reoccurrence. The issue emerges of not wanting to reinforce the violent acts of a hostile activist group. Shareholders may have fears that their investments are not secure. The media may sensationalize the story and even look for ways to blame your company. Your job of crisis leadership is to anticipate these and other reactions by impacted stakeholders and address their needs. A strong physical security response may be needed to help assure employees and customers. Possibly, an aggressive approach to help apprehend the offenders would be effective, like offering a generous reward for information and arrest. Methods for efficiently giving and receiving communications would be a vital component for dealing with this crisis.
With no prior notice, you must make on-the-spot decisions and implement rapid-fire responses when crises unexpectedly strike. Your people will be stressed-out and deadlines time-compressed. Information will be inadequate and the high-consequences of your responses could determine if people will be harmed, careers ruined and your company seriously damaged.
Experience and empirical research all seem to agree. It is best to prepare. Crisis leadership planning, training, tabletop exercises and simulations – they all play an important part in helping you become a crisis leader. Hopefully, these guidelines will help you begin the important journey toward personal and organizational crisis preparedness.
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