What is Crisis Management?

No matter what type of business you operate, you are at risk of a crisis. Therefore, crisis management is an essential function of any organization. In fact, most businesses will face a crisis at some point. Failure to respond effectively can have serious consequences for a company’s profits, stakeholders, and public image.

The role of social media in a crisis

In the age of social media and the internet, news spreads almost instantaneously. Organizations therefore need to respond to public relations crises quickly and effectively to mitigate damage.

The greatest change for crisis management has been the social media revolution. During a crisis, it can be a threat to organizations, as it allows the public to disseminate information more quickly and to a wider audience. People can express their opinions, spread rumors, and share their experiences in a visible way.

What is Crisis Management?

“The actions that are taken to deal with an emergency or difficult situation in an organized way”

Cambridge Dictionary

A crisis is defined as a major threat to operations that can have negative consequences if not managed properly. In crisis management, the threat is the damage that can occur to an organization, its stakeholders, and its reputation.

Crises can create three types of related threats, as follows:

1. Public safety
2. Financial loss
3. Reputational damage

Effective crisis management will address all three threats simultaneously. The primary concern during a crisis must be public safety, as failure to address this issue can make the damage from the crisis worse. Reputation and financial concerns will be considered after public safety has been addressed.

Ultimately, crisis management is designed to protect organizations and stakeholders from threats and to mitigate the impact of those threats.

Crisis management can be divided into three phases:

1. Prevention: This phase involves identifying and mitigating the risks of a crisis.
2. Response: This phase involves taking action to address a crisis that has already occurred.
3. Recovery: This phase involves rebuilding and restoring operations after a crisis.

1. Prevention

Prevention involves seeking to reduce the risks that could lead to a crisis. This is part of an organization’s risk management program. Preparation includes:

• Understand your key stakeholders.
• Create a crisis management plan and update it at least annually.
• Select and train a crisis management team.
• Conduct drills to test the crisis management plan and team at least annually.
• Draft messages and crisis management templates for crisis notifications.

Communication is essential during a crisis. If you are not prepared for different crises and how to communicate during them, you may suffer more damage to your business. In the absence of adequate internal and external communication,:

1. There will be no operational response.
2. Stakeholders will be unaware of what is happening, confused, angry, and quick to react.
3. The organization will be seen as incompetent and may be subject to criminal negligence.
4. The time required to resolve the issue fully will be extended.
5. The impact on financial profit and reputation will be exacerbated.

Understand your key stakeholders

Understanding the audience that a business needs to reach during an emergency is one of the first steps in developing a crisis communication plan. There are many potential audiences who will need information during and after an event, and each has their own information needs.

Here is a list of potential stakeholders that you may need to communicate with during a crisis. This list will vary depending on your industry:

1. Customers
2. Survivors and families affected by the event
3. Employees and families
4. Journalists
5. The community, especially neighbors living near damaged facilities
6. Executives and board members

Train the spokesperson

• Avoid the phrase “no comment” because people think it means the organization is guilty and trying to hide something.
• Present information clearly by avoiding jargon or technical terms. The lack of clarity makes people think the organization is intentionally creating confusion to hide something.
• Be poised in front of the camera by avoiding nervous habits that people interpret as deception. The spokesperson should make strong eye contact, hesitate for a few words, and avoid fidgeting.
• Summarize the latest crisis information and the key message the organization is trying to communicate to stakeholders for the spokesperson.

2. Response

Crisis management is what executives do and say after a crisis. Public relations plays an important role in crisis management by helping to develop messages that are sent to individuals and organizations.

Initial crisis response should focus on three key points:

• Quick
• Accurate
• Consistent

Early Response

Aim to respond within the first hour of a crisis. This creates a lot of pressure on crisis managers to have a message ready in a short period of time. The reason behind the urgency is the need for the organization to tell its story.

The media will try to fill the information vacuum and be the main source of information on the initial crisis. If the organization with the crisis doesn’t talk to the media, someone else will be happy to. These people may have inaccurate information or may try to use the crisis as an opportunity to attack the organization. As a result, crisis managers need to respond quickly.

The early response may not have a lot of new information, but the organization positions itself as a source of information and starts to tell the side of the story. A quick response shows that the organization is working and in control.

Accuracy is key

Accuracy is important every time an organization communicates with the public. People need accurate information about what is happening and the potential impacts of the event. Due to the time pressure in a crisis, there is a risk that information may be inaccurate. If it is wrong, it must be corrected.

Consistency across communication platforms

Many websites, intranet sites, and notification systems increase media coverage and help in a rapid response. It is important to maintain consistency across communication platforms, as confusion will only make the situation worse.

3. Recovery

The organization will return to normal business operations. This crisis is no longer the focus of management, but it still requires some attention. There needs to be follow-up that is communicated.

1. Crisis managers often promise to provide more information during a crisis. Crisis managers must follow through on these information promises or risk losing the trust of the public who need information.
2. Organizations need to release updated information about the recovery process, corrective actions, and/or crisis investigation. The amount of follow-up communication required depends on the amount of information promised during the crisis and the time it takes to complete the recovery process. Intranets are a great way to keep employees updated if employees have access to the site.

Good preparation, learning, and action from experience are essential.

A crisis should be a learning experience. There must be an assessment of management efforts to see what worked and what needs improvement. Organizations should always find ways to improve prevention, preparation, and/or response.