Issue 3 - December 2002

 

 

 

 

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Leadership Lessons - Crisis Management
Turn Crisis Into Opportunity - Article 1 of 3

Why should we build a disaster plan? What is a disaster plan?

According to New Webster's Dictionary, a crisis is "a turning point in a troubled time." We would further qualify a crisis as an unpredictable, unexpected, potentially damaging event that requires action on the part of those impacted by the event. In other words, all those things that you don't want to happen, but typically do anyway.

Frederick Douglass once said, "Without a struggle, there can be no progress." Mr. Douglass most likely understood that it is inevitable that everyone, people or businesses, will face a crisis at some point. But he also seemed to believe that not all crises are necessarily "bad" and that underneath the unseemly aspects of the crisis situation may lurk an opportunity. We fundamentally agree with Mr. Douglass and believe that as all crises are manageable, it is how one manages the crisis situation that impacts whether the outcome is positive or negative.

Crises can range from any number of events including:

  • Changes in leadership where a key member of your firm leaves as a result of death, departure to another firm or a merger can place your firm in a difficult situation. With limited time to transition critical roles, your firm can be left unable to maintain its focus and may experience a decline in moral due to uneasiness and uncertainty.
  • Personnel issues, such as layoffs or other difficult employee departures, often lead to legal action and cause frustration or strain on those remaining behind, not to mention the added cost.
  • Client concerns such as loss of clients due to service delivery mishaps, legal troubles, scandal or from a mistake made by the firm, can result in not only loss of potential revenue from that client, but also from other clients as your staff is pulled away from their normal duties to spend time addressing the problem situation.
  • Outside influences such as economic downturns, competition, government regulations or environmental factors.

Firms that create crisis recovery plans are able to prepare ahead for the "worst" and properly control the situation once the event occurs, transforming what would be a disaster into an opportunity. Building a disaster plan to properly manage crises and turn them into opportunities involves 6 critical factors:

  • Leadership - clearly defining your role; determining whether your role is to lead the crisis resolution effort or support your specifically chosen staff in the process;
  • Culture - openness, loyalty and core values become even more important when crises strike as emotion, tension and stress levels become elevated;
  • Teamwork - determining ahead of time who are your allies and how you would work together to resolve the crisis, as often times the resolution is larger than one person can handle;
  • Planning - it is vital to plan before, during and after; build a disaster plan, test it often, revise it when necessary and learn from actual events;
  • Communication - communicate before, during and after the crisis; maintain communications throughout the process both internally and externally;
  • Action - in all actions be decisive, consistent and thorough.

Stay ahead of the game. By facing these potential struggles, your firm will be prepared to tackle any difficult times ahead. Article 2 in this series will identify the steps required to plan for a disaster and Article 3 will conclude by offering insight as to how to handle a crisis once it occurs. Should you want to immediately begin your planning for Crisis Management, you can locate Articles 2 & 3 in the ConvergenceCoaching Solution Center under the category of Risk Management at http://www.convergencecoaching.com/CSCmaintemplate.asp.