Text 1. Incident or crisis? Why the debate?

 

Some researchers have replaced the term 'crisis management' with 'incident management'. However this is a mistake.

Anyone reading the new British Standard for Business Continuity Management, will see nothing about 'crisis management', but will see a few pages about 'incident management' instead. So what? Perhaps you think it matters not what we should call the crucial and rapid intervention point at the acute phase of crisis? However, it has become very clear since publication of the new standard that many people do feel there is something awry here. Surely the word 'crisis' is more precise and accurate? On the other hand, the noun 'incident' might be less troublesome to digest for the stakeholders of an organization affected by a disaster or other risk event. As someone who was part of the small team assembling that draft section of the new standard the author knows full well that the latter was the winning argument.

Team members simply do not agree that the sudden impact of a disaster hitting any organization can accurately be massaged into nothing more than just an incident. Why?

Crisis (management) is a precise, honest and eponymous noun. It does not mean out of control, any more than having a sudden puncture of a car tyre whilst driving on the road means automatically losing control. In such a case you have a crisis that jeopardizes your task (i.e. driving in a straight line) and which needs immediate action (i.e. to control the vehicle, stop it hitting anyone else and steer it to the side of the road). From then on it's recovery. You can draw some parallels with a possible business disruption? To quote the Concise Oxford English Dictionary a crisis is ‘a time of intense difficulty or danger’. It's short-lived and requires special skills to respond. On the other hand, incident is defined as 'an event or occurrence' and therefore can mean just about anything over an infinite period of time.

Just suppose for a moment that your organization has been responsible for some perceived tragedy that ruins the livelihood of several people, or worse still. TV news crews report vivid images interviews from the scene and then turn to your organization for reassurance that you take the crisis seriously. But the perception is that you do not. For you it's just an incident; and a result you appear out of touch, uncaring and aloof from reality. It seems you are more concerned about spin than honesty. In such a scenario your corporate reputation could collapse due to unsympathetic reporting and subsequent public anger.

When a company runs any crisis management workshop CM expertsdo advise people to use the obvious noun 'crisis', but not to call themselves a 'crisis team' when the acute phase has been dealt with and the organization is well into recovery. The latter does undoubtedly send the wrong message to stakeholders. But to pretend at the very outset that there is no intense difficulty or anything causing a serious problem by giving the event a deliberately vague title in order to spuriously assuage any stakeholder fears is rather disingenuous.

Text 2. Crisis Management Practice

 

Sudden Crises, such as fires, explosions, natural disasters, workplace violence, etc; Smoldering Crises, problems or issues that start out small and could be fixed or averted if someone was paying attention or recognized the potential for trouble; Bezarre, like the finger in the Wendy's Restaurant Chili, a one-of-a-kind crisis; and, Perceptual Crises, such as the long-running problem Proctor & Gamble used to have with their former corporate logo, that included a half-moon and stars, which critics would claim were symbols of devil-worship, calling for boycotts of P&G products.

The practice of crisis management involves attempts to eliminate technological failure as well as the development of formal communication systems to avoid or to manage crisis situations.

The related terms emergency management and business continuity management focus respectively on the prompt but short lived "first aid" type of response (e.g. putting the fire out) and the longer term recovery and restoration phases (e.g. moving operations to another site). Crisis is also a facet of risk management, although it is probably untrue to say that Crisis Management represents a failure of Risk Management since it will never be possible to totally mitigate the chances of catastrophes occurring.

Text 3. The Aims or Benefits of Crisis Management

Mattel

Mattel Inc., the country's biggest toy maker, has been plagued with more than 28 product recalls and in Summer of 2007, amongst problems with exports from China, faced two product recall in two weeks. The company "did everything it could to get its message out, earning high marks from consumers and retailers. Though upset by the situation, they were appreciative of the company's response. At Mattel, just after the 7 a.m. recall announcement by federal officials, a public relations staff of 16 was set to call reporters at the 40 biggest media outlets. They told each to check their e-mail for a news release outlining the recalls, invited them to a teleconference call with executives and scheduled TV appearances or phone conversations with Mattel's chief executive. The Mattel CEO Robert Eckert did 14 TV interviews on a Tuesday in August and about 20 calls with individual reporters. By the week's end, Mattel had responded to more than 300 media inquiries in the U.S. alone".

Pepsi

One crisis management success story revolves around the Pepsi Corporation. The crisis started with claims of syringes being found in cans of diet Pepsi. Pepsi, confident that the tampering was not their fault, urged stores nation-wide not to remove the product from shelves. The company had the cans and the situation thoroughly investigated. This led to an arrest, which Pepsi made public and then followed with their first video news release. This showed viewers the company's steps in the factories and how it was impossible to happen within their factories. A second video news release displayed the man arrested and proved to the public that he had committed the scam. A third video news release showed surveillance from a convenient store where a woman was caught replicating the tampering incident. The company simultaneously publicly worked with the FDA during the crisis to get to the bottom of the scam. Basically the Corporation was completely open with the public throughout the entire ordeal. Every employee of Pepsi everywhere in the world was completely aware of all of the details as well. This made the internal public communications very effective throughout the crisis. Once the allegations were finalized the corporation launched a series of special campaigns designed to thank the public for standing by the corporation along with coupons for further compensation. This case served as a design for how to handle other crisis situations. The management and public relations worked together stupendously throughout the entire organization.

The aims or benefits of CM

The primary aims or benefits of crisis management would normally include:

1) Ability to assess the situation from inside and outside the Institution asall stakeholders might perceive it.

2) Techniques to direct action(s) to contain the likely or perceived damage spread.

3) Better institutional resilience for all stakeholders.

4) Compliance with regulatory and ethical requirements, e.g. corporate (social responsibility).

5) Mudi better management of serious incidents or any incident that could become serious.

6) Improved staff awareness of their roles and expectations within the institution.

7) Increased ability, confidence and morale within the institution.

8) Enhanced risk management insofar that obvious risks will be identified, mitigated (where possible) and through crisis and business continuity management as prepared for.

9) Protected and often enhanced reputation a much reduced risk of post event litigation.

Apology compared to other crisis response strategies: experimental research in the past has established the apology in crisis management to be favourable to other methods. Critics argue that apology opens an organization up for possible legal responsibility for anyone harmed by their products; detailed symptoms of poisoning; and explained what consumers should do with any affected products. Odwalla then developed - through the help of consultants - effective thermal processes that would not harm the products' flavours when production resumed. All of these steps were communicated through close relations with the media and through full-page newspaper ads.