What Is Crisis Management?

In the context of organizations, from nonprofits and small businesses to large-scale corporations, crisis management is the process of identifying potential events that could disrupt your organization in a negative way, and then creating a strategy to implement before, during, and after said event. This process is based on a crisis management strategy, which outlines every action involved in your crisis response at each stage.

At Efrvsnt, we provide customized crisis management training for organizations of all sizes, in any industry. We’ll discuss training further down the page. First, we’ll help you understand the basics of crisis management and why it matters for your organization.

What is an Organizational Crisis?

From a business or organizational perspective, a crisis is an event that leads to a major disruption of normal operations.. Typically, the crisis will fall into one or more of these categories:

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Technological Crisis

Crucial technology fails or is rendered unusable, disrupting operations

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Personnel Crisis

An organization’s member(s) acts in a way that negatively affects its reputation

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Organizational Crisis

An organization damages its own reputation through its actions

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Crisis of Malevolence

An individual or entity commits disruptive acts against an organization

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Financial Crisis

An organization’s debts outweigh its value and it can no longer fund itself

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Natural Crisis

A natural event or disaster significantly disrupts operations

A single type of crisis can cause additional types of crises to occur. For example, a technological crisis could lead to a financial crisis if a business’s core technology crashed for an extended period of time, preventing the business from completing any work and thus generating revenue.

What Isn’t a Crisis?

While almost every negative situation your organization could experience will fit into one of the categories above, that doesn’t necessarily mean the situation is a crisis — unfortunate but non-crisis events also occur across every type of organization.

An example of an unfortunate, non-crisis event is a small fire in your building that does not render your organization non-operational. The fire may destroy a limited portion of the space, such as the kitchen area or break room, but it does not prevent any of your employees from continuing to work. In this scenario, you would not need to implement a crisis management strategy.

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What Could Be a Crisis?

Although the situation above is not an organizational crisis, we can alter some of the details to make it become one. If the fire were large and destroyed the majority of the building, you would indeed need to implement a crisis management strategy. This is one of the nuanced components of crisis management — you cannot say upfront what is and isn’t a crisis without knowing the extent of the event.

Let’s consider another scenario: someone in your company has lied. This alone is not a crisis situation. Perhaps one of your employees missed a day of work by calling in sick, but you find out later that the employee was skipping work to ensure a difficult project due that day got pushed to someone else. While it may certainly be a situation to look into, this scenario is not a crisis. If, however, someone lied about their company’s product being safe for consumers to avoid losing money over a recall, this would most likely require a crisis management response.

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Who Is Affected by an Organizational Crisis?

An organizational crisis affects every entity that interacts with your organization, internally and externally. It’s important to ensure that your crisis management strategy addresses actions and responses regarding each entity that is relevant to your situation. Depending on your organization, these may include:

  • Owners and employees
  • Customers
  • Suppliers
  • Shareholders
  • Creditors
  • Government
  • Media
  • Volunteers
  • Donors
  • Local community
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Who Is Involved In Crisis Management?

The main party involved with crisis management as it applies to your organization will be your crisis management team, which should be made up of individuals who have the personalities and skills suited to the task. It often includes members who may not be the most obvious choice, and excludes those who initially seem to be the best fit. The team will also have a designated leader. You may be surprised to learn that an organization’s CEO or executive leader is not typically the optimal choice for the lead role of the crisis management team. We dive into the reasons for this more in our crisis management training, so be sure to check it out.

Ultimately, your entire organization will be involved in your crisis management strategy to some extent. This includes owners, executive leadership, managers, and employees at all levels. While not every party will have a decision-making role in the process, you can still utilize feedback from all of your organization’s members to ensure that you are doing what is best for the internal stakeholders.

What Are The Stages of Crisis Management?

The best stories have an introduction, a climax, and a resolution. A similar theme applies to a crisis, in that there are two crucial components that act as bookends on each side of the crisis itself. A proper crisis management strategy will cover each of the following three stages.

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Before The Crisis

Predict, Prepare, Practice

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During The Crisis

Act & Adapt

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After The Crisis

Review, Reflect, Revise

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Before The Crisis — Predict, Prepare, and Practice

One of the most important aspects of a crisis management strategy is that it needs to exist well before the crisis occurs. In a way, the actual creation of a crisis management strategy is part of the strategy itself. Your strategy will begin to form as you predict the types of events that are most likely to affect your organization, and then brainstorm preventative actions you can take now to decrease that likelihood as much as possible.

Prevention cannot be your only pre-crisis measure — it is equally important to prepare for each type of crisis in the event that any one of them comes to fruition. Crisis management training from Efrvsnt can play a crucial role in helping you effectively identify and prepare for these scenarios in a way that suits your organization.

Once you have a strategy in place, you’ll need to practice it at every level of your organization. It is very difficult to accurately predict how we will react once a crisis is playing out in front of us — the internal and external variables involved are too numerous and dynamic for any strategy to address in full. By running through your strategy outside of a real-time crisis, you’ll gain valuable insights regarding blindspots, gaps, and errors so that you can make corrections.

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During The Crisis — Act and Adapt

The most challenging component of your crisis management strategy is execution, as your organization will need to accept abrupt changes while still maintaining operations. You’ll be forced to make quick and difficult decisions that often seem to have no right answer, as will other members of your organization. Having the right members on your crisis management team is crucial for facilitating this “act and adapt” approach.

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After the Crisis — Review, Reflect, Revise

A crisis isn’t actually over once it’s over — your organization will have a lot to do in the aftermath of the storm. This post-crisis stage is the time to review your crisis management strategy and take note of the components you used and the ones you skipped or discarded, and whether any of those components helped or hindered your organization throughout the event. You’ll then reflect on the overall strategy using feedback from everyone involved, and make revisions so that the next time you use it, you’ll be even better equipped to handle a crisis.

Communication During a Crisis

Communication is key through a crisis, in order to ensure everyone is up to speed on how the situation is being handled, and what it means for everyone going forward once the situation has resolved. Communication within the organization can take the form of regular meetings and timely updates in which executive leadership and management share information, but it can also look like breaking down barriers to allow team members to have an easier time reaching out to those in leadership roles.

External and Internal Communication

A crisis situation affects every member of an organization, regardless of if they are the CEO or the newest hire. It also affects those outside the organization, such as clients, customers, and other organizations that work with your own. An inclusive crisis management strategy addresses all individuals affected by the disruption caused by a crisis, and it does so in a way that is appropriate for each audience.

The way you communicate is another factor you’ll need to consider. It can be challenging to navigate how much information should be shared, when it should be shared, and with whom. Crises are dynamic, meaning your communication will need to be as well. Information you share at one point may need to be altered shortly after. This can create more confusion than clarity for the audience, be it your employees, industry partners, or your customers. A thorough crisis management strategy will address how you will maintain communication in an ever-changing environment while ensuring as much consistency as possible.

Including details of how you will manage communication in times of crisis is crucial to the success of your strategy. The crisis management training solutions we offer at Efrvsnt will help you understand how to communicate effectively during a crisis while also protecting your organization from common communication mistakes that can derail an otherwise excellent approach.

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Why Does Your Organization Need A Crisis Management Strategy?

Having a crisis management strategy is an essential part of having an organization. The two ideally go hand-in-hand. The reality of life is that things can and will go wrong at some point, and relying on your in-the-moment reaction to these wrongs is a recipe for a full-blown disaster.

A crisis management strategy can provide your organization the following benefits:

  • Reduced stress on executive leadership and management roles
  • Limited downtime to form a crisis response, resulting in maintained or even increased organization productivity
  • Clear, consistent communication inside and outside the organization, promoting trust and peace of mind among internal and external stakeholders
  • A steady or improved organizational reputation after the crisis resolves

When Does Your Organization Need A Crisis Management Strategy?

You Need a Crisis Management Strategy Right Now

While your organization may not need to implement a crisis management strategy at this very moment, it certainly does need to have one. At Efrvsnt, we are passionate about equipping companies with a crisis management strategy long before they ever need to use it. This allows for the most effective preparation and practice.

How Do You Build A Crisis Management Strategy?

  • Identify the types of crises your organization could experience.
  • Brainstorm specific crises within each type that could affect your business.
  • Understand what would need to be done to prevent, manage, and resolve each one.
  • Identify who (plural) would be best at performing those actions.
  • Create a crisis management team from those you identified above.
  • Implement training and practice for that team and the entire organization.
  • Review and revise your plan regularly and after a crisis.

While it’s not so difficult to summarize this process, creating your own crisis management strategy is no easy task. Crisis management training with Efrvsnt is one of the best ways to create a crisis management strategy for your organization, because we help you work through every step to customize a plan that works specifically for your industry, size, scope, and structure. We include follow ups after our training as well to ensure that the strategy you created is as dynamic and effective as possible.

The Ultimate Solution for Your Crisis Management Strategy

Now that we’ve discussed all of this valuable but admittedly complex information, you may be feeling a bit overwhelmed at the prospect of creating your own crisis management strategy. It’s important to know that you don’t have to create this strategy on your own, nor should you — crisis management is a specialty. Just as you are an expert in your organization’s industry, the team at Efrvsnt comprises experts in all areas of crisis management. If you’re ready to create a crisis management strategy that you can rely on, learn more about our crisis management training or reach out to the Evrfsnt team now. We are excited to work with you and your organization!