It is imperative for companies to have a robust crisis management and communication strategy to manage a disaster or any type of disruptive event.

The world that we live in today is punctuated by crime, malfeasance, and natural catastrophes. Turn the pages of any major newspaper or visit any news Web site and you will be confronted by negative news about natural occurrences or man-made episodes. In this era of instant communication, bad news travels worldwide in the blink of an eye and the proliferation of social media can quickly reel things out of control. This makes it imperative for companies to have in place a robust crisis management and communication approach and strategy.

Real Leaders Stand Out in Crisis

People, or more specifically, leaders make or break a crisis. In the new world, leaders can no longer just manage and lead behind a curtain of invincibility—chairing board meetings, working behind designer desks, hosting business dinners, and occasionally meeting and engaging the media or the public. They are expected to front a crisis and how they handle the crisis will determine their aptitude for the job.

The AirAsia flight QZ8501 tragedy is a case in point. Mr Tony Fernandes, the group chief executive officer (CEO) for AirAsia, was at the scene of the disaster within hours and had fronted media queries ably. He was not only fulfilling his role professionally, but demonstrated empathy for the distressed families and relatives in a compelling manner.

While managing a crisis well does not reverse undesirable situations, a leader can instill confidence and understanding amongst the constituents and begin to regain trust for long-term survival.

Is Downsizing a Crisis?

Crisis communication situations are commonly associated with external factors such as a dip in stock prices, customers boycotting company products, competitive acquisitions/mergers/ takeovers, or an anti-corporate government action. However, as many companies strive to improve profit, productivity, and short-term gains, down-sizing has become a more common area that needs crisis communications support.

While there is business logic and rationale behind downsizing, its adverse impact on employees makes most leaders lament the necessity to go through it, as no one likes to be the bearer of bad news. But while even the worst leaders can deliver good news effectively, good leaders are supposed to be able to deliver bad news just as well. The key is how they do it, to make a possibly agonising experience more positive, for all parties involved.

Dealing with Crisis

When faced with a crisis, a leader should consider the following as top priorities:

  • Talk about it as soon as possible with the stakeholders,
  • Tell the whole truth, even if it means bad news, negligence, or wrongdoing,
  • Be clear and concise, addressing details without obscuring the situation, and
  • Demonstrate empathy or remorse as appropriate to the situation.

Talk about it immediately.

In today’s world, instant communication and social media have significantly reduced the time to react to a crisis. Delay in communications will lead to undesirable consequences. Rumours and speculations will surface fast amongst employees, shareholders, the media, and customers if facts are not explained clearly. Social media does not wait for post-holiday explanations.

The truth and nothing but the truth.

In 1989, a tanker, Exxon Valdez ran aground in the Prince William Sound in Alaska, spilling millions of gallons of crude oil into the waters and killing thousands of fish, sea birds, and other marine animals in the process. The spill polluted miles of the coastline and caused numerous fishermen to lose their livelihood. At that time, Exxon did not react quickly in terms of dealing with the media and the public. In fact, the CEO shunned public communication and acted defensively against all allegations. It was only four years later that Exxon set up a media centre at the affected venue.

The tardiness in communication and avoidance to tell the truth and accept blame is a classic negative illustration of crisis communication.

Be clear and concise.

A good crisis management plan is not a broad overview or a filed document in the cabinet. It should spell out actual, actionable contingency and business continuity plans, and be tried-and-tested to ascertain its feasibility. It should carry details, from a listing of designated spokespeople, to the roles of different functions within a company during the crisis, to guidelines of timing of responses, and the type of information to convey.

Demonstrate empathy.

If the crisis involves deaths, injuries, or loss of assets, leaders or crisis management teams should understand the likelihood of people becoming highly emotional. They should also understand the various stages of managing grief in order to be effective:

  • Denial. The first typical reaction to any bad news is denial of the reality of the situation. It is a natural defence mechanism to buffer against the severity of immediate shock.
  • Anger. As the masking effects of denial starts to wear off, reality and pain will surge in full force in the form of anger. The anger may be directed at companies, strangers, friends, or family members. Appointed crisis communications spokespeople should understand this “irrational” behaviour and not blame the affected persons for it.
  • Bargaining. Helplessness and vulnerability usually follow anger. During this period, it is recommended for companies to seek professional help in the form of professional counsellors or religious groups.
  • Depression. In the next stage of grief, one will start to feel sadness and regret. This phase may be eased by clarification and reassurance to help the person accept reality and prepare to bid their loved ones farewell.
  • Acceptance. This is the closing stage of grief. It is typically marked with withdrawal and calmness, although it could be misconstrued as happiness or joy.

Crisis Management and Business Continuity

No company looks forward to facing a situation that causes significant disruption to their business, especially one that involves extensive negative media coverage. The contingency plan should contain information and detailed guidance to help leaders and decision-makers consider not only short-term consequences, but the long-term impact of each decision.

Establishment of a business continuity plan can help minimise the disruption. First, identify the critical functions that are necessary to keep the organisation running. Each critical function must in turn have its own contingency plan.

Next, test these contingency plans by rehearsing the required actions in a simulation to allow those involved to become more acutely aware of the possibility of a crisis. Lastly, review and conduct a thorough and systematic debrief regularly.

 Prepare, Prepare, and Prepare

The key to any company surviving a crisis hinges on the readiness of a tested crisis management strategy or contingency plan. It is the role of leaders to step out and navigate the company through potential pitfalls. Crisis management has become a defining feature of contemporary leadership and in times of crisis, employees and members of the public expect their leaders to minimise the impact of any crisis.

As former United States President Abraham Lincoln once said: “We live in the midst of alarms, anxiety beclouds the future; we expect some new disaster with each newspaper we read.” The hallmark of any good leader and good company is not to fear crises, but step up to it for the interests of the people they serve.

Originally published in Today’s Manager, Issue 1, 2015. Visit https://m360.sim.edu.sg for more.

The opinions expressed by the writers and those providing comments are theirs alone, and do not reflect the opinions of Fuji Xerox Smart Work Innovation, or the management. Fuji Xerox Smart Work Innovation is not responsible for the accuracy of any of the information supplied by the writers.