Crisis Management - an overview

I've found myself in the position of managing some crisis situations recently and I decided to do some research on the subject - various sources through Google, Wiki's etc have allowed me to collate the following - and I thought I'd share it to save you the struggle of trawling the web if you face the same situation:

Crisis management involves:

• Identifying a crisis
• Planning a response
• Responding to a sudden event that poses a significant threat to the firm
• Limiting the damage
• Selecting an individual and team to deal with the crisis
• Resolving a crisis

Stages of a crisis

Pre-crisis
Prior to the event

Warning
Indications that there is or may be or could be an event liable to cause a significant impact on the organisation

Crisis point
When the event begins to cause significant impact on the organisation

Recovery
The acute stage of crisis has passed and the organisation is able to focus on a return to normal operations

Post crisis
Evaluation of the effects
Repair to the organisation

Role of the crisis manager

• Crisis assessment
• Event tracking
• Managing human considerations
• Damage assessment
• Assessment or resources and options
• Development of contingencies
• Managing communications
• Co-ordination with external bodies
• Controlling information
• Controlling expectations
• Managing legal requirements

Advice on handling a crisis

• Appoint a crisis manager
• Recognise that the crisis manager is likely to adopt a more authoritarian style than is normal
• Do an objective assessment of the cause (s) of the crisis
• Determine whether the cause (s) will have a long term effect or whether it will be a short term phenomenon
• Project the most likely cause of events
• Focus on activities that will mitigate or eliminate the problem
• “Look for the silver lining”- opportunities in the aftermath
• Act to guard cash flow

Dealing with the financial aspects of a crisis

• Accelerate accounts receivable (payment by debtor)- by offering a discount if necessary.
• Slow up payment to creditors where possible.
• Increase short term, sales
• Reduces expenses - especially “non mission critical” expenses
• Outsource non mission critical operations.
• Re-schedule loans

Dealing with the “people” aspects of a crisis

• Form a crisis team
• Designate one person only to speak about the crisis to the outside world
• Act to prevent or counter the spread of negative information
• Make use of the media to provide a counter argument
• Do not tell untruths - trying to manipulate or distort the information will backfire

Good luck!