Download - Crises in Business Management.pptx
CRISIS MANAGEMENT IN BUSINESS
AKANSHA AGRAWAL – ROLL NO 1AMIT SHARMA – ROLL NO 2
ASHISH DAHIYA – ROLL NO 3
Crisis Management Overview
Crisis Management Model
Crisis Management “Best” Practices
Crisis Communication
Case Studies
Conclusions
AGENDA
A crisis (from the Greek – krisis) is any event that is, or expected to lead to, an unstable and dangerous situation affecting an individual, group, community or whole society.
Crisis are deemed to be negative changes in the society especially
when they occur abruptly with little or no warning.
WHAT IS CRISIS?
Operational viability
Reputation
Credibility
Financial stability
Legal action
HOW CRISIS AFFECTS ORGANIZATION
Surprise◦ Quick onset – not expected◦ Normal operating practices do not apply◦ Puts us off-guard
Threat◦ To health and life safety◦ To business operations◦ To community, region, or globe
Quick response ◦ Communication may be difficult◦ Information is incomplete, inaccurate or difficult to obtain◦ Emotions are running high
CHARACTERSTICS OF CRISIS
Internal Events
CRISIS EVENTS THAT AFFECT BUSINESS
External Events
Business Contingenc
y Plans
Emergency Response
Plans
System Failures
People Unavailability
Cyber Attacks
Utility Failures
Fraud/ Sabotage
Building Not
Accessible
Severe Weather
Terrorist Threats
Fire/ Explosions
Utility Outage
Civil Disturba
nce
Environmental
Establishes structured protocols for managing and communicating in a crisis
Identifies potential risks which may prevent an incident from becoming a crisis
Gives team confidence and experience resulting in improved response time
Decreases severity of crisis by alleviating confusion
Provides high level knowledge and appropriate response actions
WHY PLAN FOR CRISIS EVENTS?
CRISIS MANAGEMENT MODEL
Antecedent conditions
Intrinsic crisis
Perceived crisis
Immature crisis
response
Mature crisis management
Review and Feedback
Intrinsic crisis: Total situation as seen by neutral observer with all the facts
Perceived crisis: As seen by individuals from particular viewpoints
Immature crisis response: Instant and irrational (denial/shock/panic)
Mature crisis management• Grasp of intrinsic crisis• Implementation of plans and procedures
Review and feedback:• Assessing success and failure• Feeding learning into future planning
1. Comprehensive Framework 2. Risk assessment & priority model3. Crisis strategy and communication plan4. Response action plans5. Protocols – simple and actionable 6. Relationships with internal and external parties7. Training and awareness 8. Practice
CRISIS MANAGEMENT – BEST PRACTICES
People – to respond and manage crisis◦ Define crisis team/s structure – members and alternates
◦ Establish clearly defined roles and responsibilities
◦ Develop “actionable” crisis response plans
Tools to communicate ◦ Staff, clients, regulators, and other interested parties
◦ Automated notifications, call trees, bridge lines, 1-800 lines, GETS, cell phones, Wireless, satellite phones, Internet, Emails
Processes to monitor, communicate and escalate incidents◦ Activate Crisis Management Framework
◦ Communicate to media, clients, and internal/external parties
◦ Establish and run the Emergency Operations Center
◦ Distribute one-page crisis/emergency response guides
1. Establish a comprehensive framework
Identify Risks and Threats◦ Consolidation of business impact analysis data at site level
◦ Identify internal and external threats for each location
◦ Categorize by probability of occurrence and impact
◦ Identify mitigation strategies and controls in place
Perform risk and vulnerability assessment◦ Establish classifications and weighting
◦ Calculate risk and vulnerability per site
Prioritize threats/vulnerabilities◦ Senior management agreement
◦ Create response plans for high risk threats
2. Conduct Risk & Vulnerability Assessments
Determine crisis strategy◦ Formulate, communicate, and document strategy
Develop communication plan◦ Media Strategy and Protocols
◦ Sample communications for emergency response
◦ Distribution lists for clients, regulators, and other parties
◦ Communication templates – local, regional, global
◦ Contact lists for crisis management, emergency response and business recovery staff
Protect brand and reputation◦ Appoint media spokesperson per site
◦ Provide appropriate training
3. Crisis Strategy and Communication Plan
Develop crisis response plans for high risk/threats
◦ Consult experts or leverage knowledge of internal resources
◦ Obtain a good understanding of risk or threat
◦ Create checklists for specific threats (i.e. hurricane, earthquake)
◦ Create one-page actionable response plans
◦ Identify resources and contact information of experts
Establish a central repository of crisis response plans
◦ Use as a basis for actual crisis event
◦ Update with lessons learned
◦ Share plans and knowledge locally, regionally, and globally
4. Response plans and resources
5. Establish protocols
Managing the crisis and command centre Structured agendas, roles and responsibilities and analysis tools Pre-defined rooms/bridge lines for crisis meetings Standard equipment for the Emergency command centre
Activating the crisis management framework Integrated with major incident handling process – BCP triggers Local, regional, global support – follow the sun approach Clear communication and update process for senior management
Communicating in a crisis Keep informed – media, industry, local authorities Templates of media and external party communication
Internal◦ Form partnerships with Corporate Security, Communications, and
HR – build joint response plans◦ Leverage knowledge and expertise within your firm◦ Perform site visits and establish relationships with other locations
External◦ Build relationships with emergency response agencies◦ Get involved with industry forums and committees◦ Know your supply chain and critical vendors◦ Establish relationships with Regulators and other authorities
6. Establish Relationships
Establish a comprehensive program
◦ On line E-Learning
◦ Briefings
◦ Workshops
◦ Full simulations
Regular communication to staff
◦ Keep them informed of basis crisis management activities
◦ Distribute guides, newsletters, and updates
◦ Document lessons learned – update response plans
7. Training and awareness
Build a championship team
◦ Regular drills and participation by team members
◦ Role play and simulate high risk threats as a team
◦ Involve senior management
◦ Use all tools, processes, and protocols during exercises
◦ Run evacuation, fire, and emergency response drills
◦ Involve as many staff as possible
◦ Combine tabletops scenario exercises with off-site
◦ Validate the actions in the crisis response plans
8. Practice your crisis teams
Core elements are: Identifying audiences (Who?) How communication is to take place (How?) What messages are to be communicated (What?)
Core process is: Active, two-way communication
CRISIS COMMUNICATION
Message Options: (What?)
1) Full apology2) Corrective action3) Ingratiation4) Justification5) Excuse6) Denial7) Attack the attacker
Process of Crisis Communication
GatherIntelligence
Complete arisk
assessment
Produceplans to
address risks
Promotecrisis- ready
culture
Publish plansand conduct
training
Test, reviewand practice
Risk assessment
Identification◦ define and describe
Estimation◦ likelihood and consequences
Evaluation◦ acceptability of risk
- Perpetrator was never identified- Future attempts cannot therefore be precluded
- Swift reactions reinforced Company reputation for integrity- Stakeholders reported high degree of trust- Product did not suffer in long term
TYLENOL TAMPERIN
G
- Long term costs were transferred to public- Delays in implementing clean-up leading to loss of wildlife.- Image management failed to fully recover the Company’s reputation in wider community
- Financial losses were bearable - Costs relating to clean-up were less than pre-emptive costs- Image management recovered the Company’s reputation in business community
EXXON VALDEZ
FAILURE OUTCOMES
SUCCESS OUTCOMES
INCIDENT
Be prepared for the “unexpected”
Implement a framework to enable a crisis management capability
Identify risks and threats – build response action plans
Establish protocols to ensure effective activation and management of a crisis
Establish and build relationships
Become a championship team by practice, practice, practice
Conclusions
Shrivastava, P. Mitroff, I.I., Miller, D. and A. Miglani, "Understanding industrial crisis". Journal of Management Studies, 1988, 25, 4.
Seeger, M. W. Sellnow, T. L. & Ulmer, R. R. (1998). "Communication, organization and crisis". Communication Yearbook 21.
Fischer, Robert. P., Halibozek, Edward., & Green, Gion, (2008) “Introduction to Security”. 8th Edition
Emergency Management Institute Home Page
REFERENCES
THANK YOU