Managing Crises and Unexpected Events

Many managers may dream of working in an organization and a world life seems relatively calm, orderly and predictable, but their reality is one of increasing turbulence and disorder. Today’s managers and organizations face various levels of crisis every day – everything from the loss of computer data, to charges of racial discrimination to a factory fire, to workplace violence. However, these organizational crises have been compounded by crises on a more global level. Consider a few of the major events that the affected US companies within the last few years the bursting of the dot-com bubble which led to the failure of thousands of companies and the rapid decline of technology stocks, the massacre at Columbine High School which prompted schools all over the country to form crisis teams to deal with school violence, the crash of high flying Enron Corp. due to complex series of unethical and illegal accounting gimmicks and the subsequent investigations of numerous other corporations for similar financial shenanigans, terrorists attacks in New York City and Washington D C that destroyed the World Trade Center, seriously damaged the Pentagon, killed thousands of people and interrupted business around the world; anthrax and rising scares that altered companies’ advertising and marketing plans as they weighed the public’s perceptions of the US mail; the uncertainty and confusion associated with reconstruction efforts following the War in Iraq, and continuing terrorists threats against the United States and its allies. These and other events have brought the uncertainty and turbulence of today’s world clearly to the fore front of everyone’s mind, and crisis management has become a critical skill for every manager.

Dealing with the unexpected has always been part of the manager’s job, but our world has become so fast, interconnected and complex that unexpected events happen more frequently and often with greater and more painful consequences. All of the new management skills and competencies we have discussed are important to managers in such an environment. In addition, crisis management places further demands on today’s managers. Some of the most recent thinking on crisis management suggests the importance of five leadership skills.

1) Stay calm
2) Be visible
3) Put people before business
4) Tell the truth
5) Know when to get back to business.

Stay calm

A leader’s emotions are contagious so leaders have to stay calm focused optimistic about the future. Perhaps the most important part of a manager’s job in a crisis situation is to absorb people’s fears and uncertainties. Leaders have to suppress their own fears, doubts, and pain to encourage others. Although they acknowledge the difficulties they remain rock steady and hopeful who give comfort inspiration and hope to others.

Be visible

When people’s worlds have become ambiguous and freighting they need to feel that someone is in control. The Monday following the September 11, 2001 terrorist attacks the CEO of Young & Rubicam Advertising shook hands with every employee as he or she entered the headquarters. Crisis is a time when leadership cannot be delegated. When Russian President Vladimir Putin continued his holiday after the sinking of the submarine Kursk in August 2000, his reputation diminished worldwide.

Put people before business:

The companies that weather a crisis best, whether the crisis is large or small are those in which managers make people and human feelings their top priority as ray O’Rourke managing director for global corporate affairs at Morgan Stanley put it following September 11. Even though we are a financial service company we didn’t have a financial crisis on our hands we had a human crisis. After that point, everything was focused on our people.

Know when to get back to business

Although managers should first deal with the physical and emotional needs of people they also need to get to business as soon as possible. The company has to keep going and there’s a natural human tendency to want to rebuild and move forward. The rejuvenation of the business is a sign of hope and an inspiration to employees. Moments of crisis also present excellent opportunities for looking forward and using the emotional energy that has emerged to build a better company.

  • Prof..H.K.LakshmanRao

    Wonderful and timely message to corporate Managers.For a free CD on handling crisis, statistically, call rao before Nov 7

    Dr. H.K.LakshmanRao,

  • Anbu

    This works good for all pathetic situations. I consider this as my first five principles in my life.