Almost 70 percent of leaders have dealt with a corporate crisis in the last five years, PricewaterhouseCoopers (PwC) found in its 2019 Global Crisis Survey. And, according to management consultancy McKinsey, between 2010 and 2017, the name of a Forbes-recognized top 100 company appeared in headlines together with the word “crisis” 80 percent more often than in the previous decade — and those are just the organizations that made the news.
Each year, a number of businesses experience crises that are never reported. Sometimes it’s because the company executed their crisis management plan flawlessly; other times it’s because the company caught a lucky break and dodged public scrutiny. Getting by on luck alone, though, will only go so far in a world where critical events are on the rise. According to Industrial Safety & Hygiene News, for example, communicable and infectious diseases are increasing in the United States, while climate change is generating more severe weather, such as unexpected floods and massive wildfires. CNBC has also reported an uptick in mass shootings and, on the digital side, cyberattacks continue to climb, says Business Insider.
Crisis management preparedness can blunt or offset some or all the impacts of such threats. Without it, crises can cost businesses revenue, impair productivity, damage brand reputation, and jeopardize a company’s very survival. Is your business adequately prepared?
What Is Crisis Management Preparedness?
To evaluate your company’s crisis management preparedness, it helps to know what preparedness involves, as well as its place in the lifecycle of a crisis, which consists of three stages: preparation, response, and recovery. In the preparation or first stage, you lay the groundwork for a strong response to a crisis, and you develop a disaster recovery plan that allows you to return to business as usual as quickly and efficiently as possible. Preparedness is key because it helps you identify vulnerabilities and coordinate how you might best protect your colleagues, customers, partners, and organization in a crisis.
The preparation stage is when you’ll assemble your core crisis team. They’ll perform a business impact analysis and decide which recovery strategies will best ensure business continuity. In fact, drafting a business continuity plan (BCP) follows next. Benchmarked against other BCPs in your industry, it’ll address the coworkers, vendors, tools, and processes that will power your crisis management. From your communications response to listing the alternates or substitutes for key team members who may be away or moved on to another company, your BCP should provide a comprehensive blueprint for tackling various risks.
Crisis Management Case Studies
To get a sense of how preparedness can affect how an organization handles crises, let’s take a look at real-world examples.
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