The four pillars of crisis management

The four pillars of crisis management

Chris Huggett, Senior Vice President, EMEA & India at Sungard AS says that businesses must take stock of their vulnerabilities and put into place a plan of action to be executed in a crisis.

Today’s IT-driven business world has re-defined the traditional understanding of risk management. The threat of cyber-attacks or IT failures impacting business operations has materialised in a number of high-profile cases that have erupted in the media, causing a stir both among end-users on social media and in the mainstream media.

The level of resilience business demonstrate in a crisis can determine its future: bouncing back quickly with minimal disruption can imbue a brand the air of resilience, while protracted periods of uncertainty and an absence of leadership can cause irrevocable damage to brand identity and leave stakeholders, customers and partners questioning the integrity of the business.

The difference between survival and decline when a crisis occurs is dependent on whether business leaders are able to react effectively and demonstrate the leadership qualities needed to steer the crisis towards its resolution.

The variety of crises – from cyber security breaches, extreme weather and the breakdown of highly complex IT systems – are putting business leaders to the test, challenging their ability to protect the business’s reputation, customer relationships and the future of employees.

As a result, businesses must take stock of their vulnerabilities and put into place a plan of action to be executed in a crisis. The first step to doing this is through visibility:

Five crucial questions that must be answered in a crisis

  • What happened?
  • Why are we here?
  • How are we going to get out of it?
  • What route are we going to take?
  • What things to we need to do to get there?

In a crisis, a business is typically only working with about 60% of the information it needs, and decisions have to be made fast. Leaders need to communicate effectively and make decisions even without the full facts.

They will also be facing fear from customers and, likely, pressure from the media for a statement. If they wish to be a resilient leader, they need to accept that the crisis has happened, that there is a huge amount of uncertainty and move forward.

Crucially, they have to get a grip on the situation and stabilise things as quickly as possible, including presenting a calm, authoritative and determined view. This shows that they are in control of the situation and have the capability to fix the problem, helping to defuse tensions, inspire confidence, focus on what needs to be done and reassure stakeholders.

Strong leaders also need to build a team, accord and facilitate collaboration. That includes managing the various stakeholders involved and setting clear roles to ensure that they are helping not hindering how the organisation responds.

Also of interest: What’s the best way to respond to a data breach?

The four pillars of effective crisis management

Being as prepared as you can be for when a crisis hits means having a view of and a prepared response for all reasonable eventualities. A vital element of that is making sure the leadership is trained and prepared and can demonstrate four key crisis skills, which include:

  • Self-assuredness

Not everyone is born with innate confidence, so the key is to practice. Continued practice will help leaders develop the presence associated with those in a position of power. This presence is particularly important when the media is snapping at the heels of a business for a statement. It’s important to show credibility and pragmatism, as well as the ability to respond to a crisis situation as a human and not as a corporate robot.

  • An analytical eye

A leader must, as quickly as possible, accept the new reality within which they are working when a crisis strikes. Only then can they figure out what they need to do to move towards a positive outcome. To do this requires creative problem-solving skills. That includes the magic of delegation – identifying where outside expertise is needed or where others are better placed to carry out a specific task.

A leader must then ensure that everyone is working simultaneously on different elements of the problem. Then, when someone has finished working on a task in isolation, they are brought back into the team.

  • Emotional intelligence

Emotional intelligence is a vital soft skill for strong leadership. Whilst levels of emotional intelligence vary hugely between different people, as with confidence it can be developed. Leaders should be provided with executive coaching, should be encouraged to listen to feedback and should think about how others might be feeling in a certain situation. This includes the ability to communicate effectively.

But perhaps one of the most important and difficult skills to learn is the ability to be adaptable. Leaders must feel empowered to be able to change their minds and the direction they are taking as the situation and new facts come to light. Ignoring the facts and maintaining the same course will result in failure.

  • Delegation

Importance vs power/influence can be one of the biggest challenges to manage in the case of a crisis. Different stakeholders will have varying views on the best course of action, so managing both their expectations and that which is best for the business as a whole can be tricky. It’s important as well not to leave people behind.

For example, if you have staff at an office in another country, they need to be informed of what’s going on so they understand their role. This is where working with the various management teams across an organisation is important, looking both inwards and downwards to make sure no one gets left behind.

A crisis can be a hugely disruptive and uncertain time for any business, however, if managed right, it can also be an important learning opportunity. By showing resilience during a crisis, a business can not only maintain its reputation but also potentially improve it by showing its strength. Resilient leadership begets resilience throughout a company, helping to create a culture of strength to bolster crisis resolution efforts.

Copyright Lyonsdown Limited 2021

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