Crisis management

In the aftermath of such events the natural tendency is to assess the way the authorities dealt with the occurrence. Was sufficient warning, where possible given? Was recommended action defined and communicated efficiently to the concerned parties? Was a contingency plan in place and if so was it followed correctly? In fact the emergency services in London were commended on their handling of the situation, which was attributed to the fact that they had planned for such a terrorist attack on the tube and had carried out a co-ordinated exercise to practice and assess their ability to handle the scenario not six months before.

In the great Dubai power outage of 2005, something -I have via a very reliable source- caused by allowing a component with a life span of ten years to suffer over fifteen years service before it finally gave up and went pop.

I was firstly alerted to the outage and the components overdue demise while navigating Karama in the morning and finding the traffic flow surprisingly good for the time of day and location. It was then that I approached my first junction with defunct traffic lights and realized the reason for the improved flow rate. Left to their own devices motorists were doing a splendid job of crossing junctions without any deference to official traffic management. Upon parking I entered the building which contained the office I was to visit and to my angst realised that said office was on the tenth floor. Confused employees were milling around the foyer presumably contemplating a long wait or mountain climbing. By now curiousness had got the better of me so being relatively fit I settled on the latter, on the seventh floor I realized that actually I was not that fit and perhaps I should have waited. By the tenth I was somewhat damp and cursing my choice when I realised that no power meant no air conditioning either. After meeting the office secretary and consuming two tissue boxes-to dry myself-I was informed that my meeting would probably not take place because they could not phone the salesman to tell him I had arrived and him being a man of exceedingly large proportion there was no possibility of him following my vertical lead up the stairs. The fact that we had a prearranged appointment seemed to be of no consequence (as is so often the case here). I foolishly decided to wait and while I did noted the situation.

Clearly the staff were unaware what to do, they had no policy as to whether they should go home or should wait until things improved. The offices were baking and the likelihood of getting custom thanks to the lifts being out very unlikely. All the computers were down, only old fashioned paper-based offices would be able to function, even the phones were out of action. Although an extreme example, it served to highlight the need for contingency planning and crisis management.

The word crisis comes from the Greek krisis, meaning "decision." A crisis in essence is a situation which requires a quick decision to minimize damage or provide a solution.

A crisis is a true test of an individual's or company's metal, if good crisis management is evident, no doubt the company or individual will be successful in less frantic times. Unfortunately, until a crisis occurs most companies or individuals don't know how they will perform. The good news is that preparations for a crisis can be made now.

Apart from avoiding a crisis in the first place with good planning, prevention being better than cure there are two ways to approach crisis situations:

1) Quickly address and resolve crisis issues before they escalate into catastrophies

2) Seek possible ways to turn crisis into an opportunity

The Pharmaceutical giant Johnson and Johnson managed the second method in 1986. Criminals put lethal amounts of cyanide in Johnson and Johnson bottles of Tylenol, a cough medicine while they were on store shelves. Before long, seven people died from the poisoned medicine. The company met the crisis head-on. First, they spent $300-million recalling all samples of the medicine bottles. Then the company introduced new tamper-proof medicine containers that changed the entire industry. But most importantly, Johnson and Johnson was prepared, it acted coolly, they answered tough questions, and in the end maintained their dominance in the market. They used the media to demonstrate their concern and their determination to resolve the crisis. They showed courage, leadership and effective crisis management.

Typical crises include, materials shortage, machine breakdown, transport delays/ loses, financial problems, legal problems, staff absence, emergency situations; accident, fire, flood and storm. In short anything which goes against or jeopardizes the smooth running of the business.

Crisis management starts with having a contingency plan that can be practiced and analysed for effectiveness. Departments and companies should be honest about the crisis situation so that a true picture of the crisis can be gleaned. Exxon mobile did huge damage to themselves by trying to cover up the severity of the oil spillage of the Exxon Valdez, when the truth came out they lost their market edge and had to pay over five billion dollars in fines.

Focus on finding the solution don't blame-throw or search for the culprit and above all maintain calm.

These simple steps will ensure that whatever crisis befalls the company, employees will have a planned response and can either expend their effort on the necessary action, or know when it is time to go home and not mill around in befuddled confusion.