CRISIS IN OR OUT OF CONTROL

How often have we heard the expression “this is completely out of control”?

A crisis of any magnitude can hit an organisation where it hurts without a moment’s notice and it doesn’t take long to lose control.  The only protection is a well-rehearsed crisis management plan.

In a matter of minutes, a serious incident or emergency can run out of control and seriously disrupt a business with catastrophic effect.  In some cases, it takes years to recover.

The right response actions can minimise serious damage and can quickly put an organisation in control of its destiny.  Management needs to consider the organisation strategically and ask what is the worst thing that could possibly happen.  Fire, financial problems, lawsuits, cyber crisis, product defect, sexual harassment, act of violence, terrorism, security breach, technology collapse, executive misconduct or environmental issues to name a few.  With the most likely threats in mind, management can prepare strategies to avoid or manage a potential problem and control the agenda.

Reading between the lines in today’s media reports of crises, it is easy to see which organisations have anticipated the problem and have a planning process in place to deal with it.  If an organisation is ready, then there will be a clear message about what is being done and who is doing it.  

It is not just large organisations that need to have comprehensive and integrated crisis management plans.  All organisations need to anticipate crises.  It is so important that small and medium-sized organisations look at their worst case scenarios - the service industry, government, educational institutions, professional firms and research organisations.  They often face the greatest damage from a negative event because they may lack the financial and managerial support required to respond and recover efficiently.

Ownership of crisis management planning must come from the top because most crises end up at the top.  The top global executives recognise that crisis management is a corporate governance strategy and endorse its implementation.  They know that a crisis out of control is liable to lead to loss of profits, lawsuits, loss of market share,  serious loss of reputation and, in many cases, loss of senior jobs.  After writing numerous plans for organisations, I am totally convinced that unless complete support of the Chief Executive and top management is assured, the crisis management program will flounder and never reach its currency.  The day the Chief Executive or Managing Director endorses the organisation’s intentions to install a crisis management program is the day it really happens.

Debriefing after Real Crises. The Best Learning

Financial disaster, major accident, cyber attack, massive recall. No simulation or crisis management exercise can ever replace the real thing.  When a real crisis occurs, most aspects of the crisis management plan would be applied, but there will be many more critical issues and intricacies which will appear. 

It goes without saying that the strategy behind a solid crisis management plan is to protect the company’s operations and reputation by providing a secure response.  But the identification of gaps in the response plan can be best discovered after a review of a real crisis situation.

A crisis simulation or exercise concludes with an evaluation and critique where responses are examined and roles and responsibilities reviewed.  The aim of these crisis exercises is to improve the effectiveness of the teams in managing a crisis, at the same time as reviewing the crisis manual and the various human and technical resources that assist the process.

A real event, aside from its serious consequences, can offer greater learnings, particularly related to the complex issues of communication, interactiveness and stress.

Any post-crisis evaluation must be done relatively quickly after the event.  The real value of what has happened, and how crisis teams responded, can be only be learnt while memories are alert to the central issues of the response. 

The purpose of the post-crisis evaluation is not to investigate the cause of the incident nor items such as emergency response, product recall action or security performance, but more how the crisis management team performed in its role.  Was the crisis identified effectively?  Was the team called out efficiently?  Could the team respond immediately and was the response effective?

Post-crisis evaluation is about managing and controlling the corporate issues related to the future of the business.  The following items need to be addressed in the audit:

1.      A narrative of the actual event.  What happened, why and how and what caused the event?

2.      How was the response managed by the crisis management team?  How did the response relate to incident and operational response procedures?  What was the decision making process based on?

3.     Were human and technical resources adequate?  Where did they fail and how could they have been improved?

4.      Is the organisation still at threat from the problem or similar problems?

5.      What were the unintended consequences that came out of the original incident?

6.      Were there any barriers to communication?

7.      Were all stakeholders advised effectively?  If not, what were the problems?

8.      Was there sufficient co-operation with outside agencies (emergency services, government, etc.)?

9.      Were the plan, manual and procedures useful?  Where could they be improved?

10.    Were human resource issues and employee communication handled efficiently?

11.    Were there any barriers to crisis response from senior management?

12.    Were legal issues dealt with efficiently? 

13.    Was the spokesperson’s role effective?  Were messages continual and consistent?

14.    How was business continuity and recovery managed?  What were the problems?

15.   What has been put in place in the short term and the long term to prevent this crisis from happening again?

This post-evaluation needs to be carried out by either outside consultants or a senior management team and preferably not by the crisis management team.  It is designed to improve operations, decision making, plans, skills and to ensure the crisis management team has done its job effectively.  

The post-evaluation team needs to interview the crisis management team, management executives, employees and external personnel/contractors involved in the crisis response.   

A post-evaluation project is no easy task.  While it has to be done as soon as possible after the crisis has occurred, it needs time for investigation, review and context. The project team needs the support of the Chief Executive and senior management, and commitment has to be given to ensure that the learnings from across the business can be incorporated in the overall crisis managing planning process.  This process ensures continual improvement and further development of a best practice response.  

The learnings of the post-crisis evaluation of a real event should be made available for training and response reference to the crisis management team.                           

Stakeholder Control in a Crisis

When a crisis team meets in the first 90 minutes of managing a critical incident, one of the essential priority actions has to be identifying key stakeholders. There is no doubt that a stakeholder checklist can be prepared by crisis managers before an event happens but many of these stakeholders can only be identified on the day.

This proactivity is about getting ahead of your key audience agendas.  It doesn’t take long to call and tell a politician, a senior police officer, a journalist, a regulator, a stockbroker, a banker or indeed your own executive and managers about your emerging problem and how you are dealing with it.  They become a credible source in understanding and communicating your response. It’s not a time to bury your head in the sand and say nothing.  The bunker mentality may feel good for a few hours but it’s the fastest way to lose the high ground and encourage the rumour mill.

The court of public opinion wants to know what happened from you and social media plays a large part in early news transmission. Very quickly they will form opinions as to whether you are guilty or not guilty.  If your stakeholders understand that you are on top of the situation making every effort to fix it, they will be an asset to your response.

Commercial Union, one of Britain’s largest insurance companies, had their offices blown apart in London in the 1990s as a result of a terrorist bombing.  Much of the incident and emergency management was handled by the London Metropolitan Police in a very efficient manner, however the company played its part in dealing with a large group of audiences of its stakeholders.  The CEO and crisis Team Leader showed strong leadership and split the business management team into two, one to deal with the day-to-day running of the business and the other to deal with the crisis.  

This explosion killed three people and injured 30.   Four hundred tons of glass and debris were spread across the street and the city of London was brought to a virtual standstill.   The Commercial Union premises were totally inoperable.  The management team went straight to their crisis plan which outlined management teams and established priorities. 

As part of their damage limitation, assessment and action planning, they were quickly able to audit their employees to identify injured personnel and make contact with families.  They had procedures for effective liaison with emergency services. 

Plans were in place to make their building safe and secure, particularly related to the company's information and communication capability. 

All meetings were documented as were all discussions.  They moved immediately into recovery mode to restore communication links and it wasn’t long before they had established alternative premises and replacement of their main switchboard and computer information facilities. They established a temporary communications centre while they were moving into their new building and they were able to follow a plan of where to go, what to do and who does it.

In terms of communication, they made themselves available and distributed information to their staff, the public, media, customers, shareholders, brokers and the insurance industry.  Commercial Union particularly honed in on immediate and longer term plans for staff to encourage morale, goodwill and enthusiasm.

Admittedly, Commercial Union were the victims of a terrorist bomb that blew up outside their 23-storey building.  They certainly had the support and understanding of the British population behind them.  However, regardless of this support, they had to ensure company, corporate and brand survival at the same time as showing that they were able to manage the situation.  They ensured continuity of operations and control of the situation. 

Responding to Unpredictable Crises

Malaysia Airlines' two tragic incidents of an aircraft disappearing in flight and another crashing into a war zone are international worst case scenarios. The massive oil spill in the Gulf of Mexico was beyond a crisis of usual circumstances. A terrorist shooting in a coffee shop in Sydney is an unusual and rare event in that city.

A Crisis Management Plan has to outline courses of action to be taken in the event of a critical incident or catastrophe. Importantly, worst case scenario response to threats have to go as far as possible in providing orderly and efficient transition from normal to critical conditions. A plan must provide specific guidelines appropriate for complex and unpredictable circumstances.

The crisis you don’t expect or plan for will be the one that’s likely to cause the most damage.  And while a lot of pundits believe that a good manager is automatically a good crisis manager, it is important to understand that many managers cannot cope with the stress, pressure and abnormal behaviour that occurs during a crisis. 

Most normal management behaviour is reversed.  One minute you are managing a business, the next minute you have to manage a crisis.  Different skills under different pressures.

How many managers can move rapidly from the normal pace of a business meeting to the hectic, urgent demanding pace of life and death decisions, evacuation, emotional trauma and split-second timing?

Containment is the key.  Managers who are prepared, rehearsed, educated, trained and aware are those that can make the transition when crisis hits and contain the situation.

If there is a single, critical feature to being prepared for crisis, it is in treating crisis management and recovery as an ongoing process.  Seeing it as an integral part of an organisation's everyday business activities, not merely as a plan that is created, approved, then shelved until needed. 

It is a process that has the whole organisation - from site management to CEO and Board - trained, tested and involved in a crisis management plan that is integrated seamlessly across the whole organisation. And regularly monitored, reviewed and audited, just like any other quality control policy that is demanded by compliance factors in today’s business environment.

To achieve this, there are a number of critical features of a crisis plan that facilitates speedy business resumption. Whether the crisis is an aircraft incident, cyber crisis, oil and chemical spill or explosion, a tainted food product or charges of business corruption, or an act of terrorism a crisis management plan must:

• Have tactical decisions made at the crisis location and quickly.  (This is where the public focus will be initially)
• Localise the response while maximising corporate and strategic assistance.
• Provide training and support to give executive management the skills and confidence so they can manage the early stages of a crisis.
• Create a tailor-made plan around uniform standards, organisation-wide
• Develop realistic simulations and training exercises.
• Start planning for recovery before a crisis occurs.

What fundamentally distinguishes crisis-prepared, from crisis-prone organisations, is their overall cultural view of crisis management and recovery. 

Strategic actions, technical and structural response, communication initiatives and psychological support have to be part of an integrated management plan and checklist process that immediately puts the organisation in charge of its own destiny.

The worst case scenario requires more than critical risk analysis. It needs to go beyond the ordinary critical event and consider extreme escalation. This planning is essential for effective inter-organisational response. 

Catastrophes and best practice crisis management

Regarding the recent terrible flooding crisis in the UK, I have just returned from that country and seen first hand the devastating flooding as torrential rain has caused the worst weather in UK’s history, with much of the Somerset area that I saw looking more like an inland sea.

As The Guardian newspaper quoted then - “public anger has risen as inexorably as the filthy waters in thousands of homes.”  The Prime Minister, David Cameron, took a while to get there which presented the question in the court of public opinion of “why has he taken so long”?  Once there, he seems to have been very community active but he could have learnt a lot from the early leadership stance of then Premier, Anna Bligh, to the floods in Queensland, Australia. She walked and talked to the community from the start. Leadership spokespeople in crises must arrive early and say and make things happen.

2014 will see the timely launch of a new British Standard for Crisis Management for both business and government organisations and most applicable for strategic response to major events such as floods, fires, riots, explosions, critical accidents and major product disasters. 

The new Standard will be aimed very much at executive management and those with strategic responsibilities in developing crisis management capability within their organisation. To quote the British Cabinet Office Public Available Specification facilitated in advance of the new Standard, "crises present organisations with complex and difficult challenges that may have profound and far-reaching consequences, sometimes irrespective of how successfully they are seen to be managed.  These consequences can be very damaging, especially where it is perceived that the organisation failed to prepare for, manage or recover from a crisis."

This is very relevant as countries and organisations around the world develop their crisis management capability at a more high-level context to respond to catastrophes. Malaysia Airlines and the Malaysian Government are experiencing this level of executive response under the microscope regarding their missing 777 aircraft where airline officials and government leaders are presenting information with very mixed and misleading messages.

2014 Crisis Management Imperatives

In 2014, crisis management has moved further forward to support risk and resilience management. The unexpected crisis, both for government and corporations, has become a high priority. While hospitals, fire fighters and law enforcement response organisations continue to upgrade their capability, many executives and senior managers are not prepared either intellectually or emotionally to face rapid, escalating tragic events such as major accidents, corporate collapses, infrastructure failures, massive product recalls or acts of terrorism.

Even though some organisations have been through a major crisis, management avoids talking about the subject, often because they equate crisis with bad management and events like that do not happen on their watch.

The most rapid advancement in crisis management preparedness is the speed of communication. CEOs and managers at every level need to know and share information rapidly. In today's world of instant media coverage and social media commentary, if an organisation doesn't get its message out clearly and distinctly at the beginning of a crisis, someone else will take the high ground. The moment of control will be lost.

Then why are some organisations better able to take control of a crisis rapidly? The key elements are:

* The CEO and CFO have a commitment to crisis management and contingency planning for response to
threats that can harm the organisation's personnel, property and reputation.
* Divisional, subsidiary and affiliate management develop similar contingency plans in their areas
of responsibility consistent with the organisation's policies and procedures established by senior
management.
* There is a clear identification and measurement of threats.
* Executive teams, divisional teams and site teams are trained and ready.
* The plan is tested, validated and current.

The crisis best practise organistions I work with understand that these are bottom line issues. They recognise that crisis management planning is a resilience strategy. They understand that uncontrolled crises can cause high employee turnover, interrupted workflow, massive asset damage, lawsuits, loss of market share and, in a corporate environment, a detrimental effect on share price.

Make 2014 the year to ensure that your people and your plans are functionally up-to-date. Take advantage of new technology to share information rapidly. Make sure your human resources, legal, risk, corporate governance and corporate affairs processes are linked with your executive rapid response. Err on the side of over-disclosure - credibility is the key to perception.

Corporate readiness for crisis

The crisis you don’t expect or plan for will be the one that’s likely to cause the most damage.  And while a lot of pundits believe that a good manager is automatically a good crisis manager, it is important to understand that many managers cannot cope with the stress, pressure and abnormal behaviour that occurs during a crisis. 

Most normal management behaviour is reversed.  One minute you are managing a business, the next minute you have to manage a crisis.  Different skills under different pressures.

How many managers can move rapidly from the normal pace of a business meeting to the hectic, urgent demanding pace of life and death decisions, evacuation, emotional trauma and split-second timing?

Containment is the key.  Managers who are prepared, rehearsed, educated, trained and aware are those that can make the transition when crisis hits and contain the situation.

If there is a single, critical feature to being prepared for crisis, it is in treating crisis management and recovery as an ongoing process.  Seeing it as an integral part of the company’s everyday business activities, not merely as a plan that is created, approved, then shelved until needed. 

It is a process that has the whole company - from site management to CEO and Board - trained, tested and involved in a crisis management plan that is integrated seamlessly across the whole organisation. And regularly monitored, reviewed and audited, just like any other quality control policy that is demanded by compliance factors in today’s business environment.

To achieve this, there are a number of critical features of a crisis plan that facilitates  speedy business resumption. Whether the crisis is an oil and chemical spill or explosion, a tainted food product or charges of business corruption, a crisis management and recovery plan must: 

•     Have tactical decisions made at the  crisis location, and quickly. (This is where the public focus will be  initially.)
•     Localise the response, while maximising corporate and strategic assistance.
•     Provide training and support to give staff the skills and confidence so they can manage the early
  stage of a crisis, and back them up with appropriate technology.
•     Create a tailor-made plan around uniform standards, company-wide.
•     Develop realistic simulation and training exercises.
•     Start planning for recovery before a crisis occurs.
•     Instil a company-wide recognition of the potential impact of a crisis.

What fundamentally distinguishes crisis-prepared, from crisis-prone organisations, is their overall cultural view of crisis management and recovery. 

Strategic actions, technical and structural response, communication initiatives and psychological support have to be part of an integrated management plan and process that immediately puts the organisation in charge of its own destiny.

This process must be a crisis management corporate preparedness program of total commitment by its executives and staff to key stakeholders.

Crisis agenda control - your organisation must be heard

Do you want the head of a SWAT team, a fire chief, or a corporate watchdog from a government agency speaking publicly on behalf of your company? Very often, many different outside service organisations and government departments can be involved in a crisis response.

 These groups can dominate your organisation’s location and, if not effectively managed, can become the face of your company, at the same time as dictating the mainstream of messages coming out of the event.  It is important to ensure that an organisation’s crisis plans incorporate ways and means of dealing with outside support groups working in the same response.    

In the response of TWA Flight 800 that was bound for Paris and literally crashed into the sea near Long Island, more than 50 disaster and emergency services operations and government agencies came together to initially deal with the disaster.  At least 20 agencies went on to investigate the event, deal with the pollution caused on the coastline, counsel friends and relatives, and work towards recovery.

The mayor of New York became intensely involved in advising next of kin, problems of environmental pollution and getting the message out to the US and international public.  The Coastguard was involved in underwater salvage.  Other Federal officers from a number of agencies were involved in the complex range of investigations.

This disaster became a major news item across the US for several months as many families and members of the public believed the handling of the whole situation was a crisis in itself.  Many of the post-incident evaluation sessions emphasised the need for greater collaboration between emergency services and government authorities.  All these organisations have their separate response plans which eventually need one common planning and communication thread.

Eric Jacoby Jr., Director of the New York State Emergency Management Office,  indicated there will be a number of changes in local government crisis management procedures following the response to the TWA Flight 800 crash.  He is working towards a greater linking of disaster and emergency policies for future crisis planning.

Reading the reports from the Contingency Planning Exchange Incorporated, it identified what TWA had to face was far more than an emergency. 

It was:

·        dealing with distraught families

·        managing an emotional public

·        coping with a huge press response

·        managing rumour and innuendo

·       coping with a large number of government enquiries

·       management of collecting evidence and finding the cause

Agendas run high in crises.  Political agendas, personal agendas, corporate agendas, emergency agendas, legal agendas.  In TWA’s case:

• New York’s Mayor, Rudolph Guiliani, was concerned about notifying victims’ families, the environmental damage and telling the public.
• The Coast Guard was concerned about recovering evidence from the water and dealing with retrieval of bodies and managing the area of water where the wreckage was located.
• The New York Police Department were concerned about the huge security problems at JFK.  In addition to the normal airport traffic, there were literally hundreds of other people making enquiries.
•  The FBI was concerned about the federal and international implications of terrorism.   
•  Lawyers from around the United States wanted to represent the families and the businesses affected.

There were in fact 21 agencies involved in the investigation, cleaning up the beaches, security of the airport, investigations at the airport, counselling grief-stricken families.  Twenty one agencies who were dealing with the crisis management team at TWA.  Something like 2,000 people.  Five hundred media representatives set up operations at the airport and coastguard stations. 

The importance of crisis planning and communication was emphasised in all the post-incident evaluations. 

Planning and communication - two areas in which TWA was - quote “woefully inadequate” - said Mayor Guiliani on US television.  

TWA received criticism from many fronts.  As a result of much of the criticism and the Gore Commission for the US Congress, changes have been made to future crisis management strategies.

Pre-empt the worst case scenario for your organisation. Take control of the agenda in a crisis and make sure you are heard early and continually throughout the crisis response.

AIRSHIP INDUSTRY CRISIS RECOVERY FAILURE

Recently we conducted a survey of businesses, corporations and government to find out what their crisis management recovery program was like. Of those that had crisis management and recovery plans, 30% had not tested them in the last four years.  Not testing crisis management and recovery plans is as good as not having them. The likelihood of full recovery will be very low.
 

The worst kind of event can wipe out a plant, destroy vital information and virtually stop production, but it should not finish the business.  The minute a crisis is declared, the recovery phase runs parallel.  Alternative means of operation have to be put into action, customers need to be advised, suppliers need to be contacted, and employees have to be supported and brought into the picture early.  Assets and earnings have to be secured and brand reputation and corporate image need to be stabilised.

The transport industry places recovery and damage control high on their crisis management agenda.  Transport disasters have been the death knell of some transport companies.  Aside from Concorde and some specific aircraft, the only industry to actually die because of disasters is the airship industry.  In fact, there were only two disasters - the airship R101 and the Hindenberg.  And in real numbers, there was a combined death toll of less than 100.  Small numbers compared to the 1,403 lost on the Titanic.

  

In October 1930, the R101 left its mast in Bedfdordshire in the United Kingdom with 54 people aboard, loaded to the hilt.  The fittings on the airship included silver cutlery, potted palms and heavy Axminster carpeting.   

There were large supplies of the finest gourmet food and wine with plans for a banquet over Egypt.  It was also carrying more diesel oil than was needed. 

The airport of Le Bourget in France gave confirmation that the airship was one kilometre north of Beauvais.  Then came the report that the R101 had caught fire after not clearing a hill.  There were reports of a huge fire in the air and the sound of an explosion as the airship hit the ground and broke up.  The cause was never really clarified but it rapidly brought Britain’s airship industry to a close.

Germany persisted with airships, particularly with the magnificent Hindenberg, the ultimate passenger experience.   Magnificently prepared cabins, plush dining room, a library and even a smoking area.   This airship made flights to the United States and passengers relied on this as a regular form of transportation.

On 3 May 1937, the Hindenberg flew into her American landing area from Germany.  Families of passengers awaited at the Lakehurst Terminus.  The media were there.  A radio reporter, with his wire recorder, had decided that this was an interesting event to review.  He moved through the landing processes as the airship slowly lowered its bulk to the ground from the mooring mast.  Then, without any warning, there was a flash.  In the midst of this historic broadcast, the man, engulfed in emotion, screamed “it’s flashing, flashing, flashing terribly, it’s bursting into flames.”  This historical and frightening broadcast was one of the first on the spot broadcasts of an actual disaster in action. 

The crew of the Hindenberg did an outstanding job of helping injured passengers and crew from the burning inferno.  Thirty-six people died from a total of 97. 

This was the end of the airship industry.  The media gave the disaster world-wide headlines and the broadcast was aired on radio stations internationally.  Public outcry and fear was enormous. 

The airship industry reviewed its options but recovery was not one of them. Safety and lack of capability signed the death warrant.  The Germans removed other airships from their fleet and both the UK and Germany closed their factories and hangars.  It was all over.

Management Training for Crisis

Crisis management training is the centre of crisis preparedness. All businesses and organisations need specific training to build a crisis response capability. Training reduces the potential for panic, chaos and confusion and focuses a crisis team on the components of a successful response. 

The objective of a crisis management workshop is to enable crisis management team members to understand the basic principles of crisis management and its application within the organisation.  A good program is designed to review the crisis management plan, team roles and responsibilities, threats and responses and should cover the following:

·      Crisis training objectives:  what the session will achieve.

·      Introduction to crisis - cause and effects:  definitions and examples.

·      Crisis prevention and warning systems:  actions to prevent crises

·      The value of crisis management:  the benefits of being ready - strategies for damage control.

·      Overview of the plan and manual:  walk through each element of the plan and clarify.

·      Crisis management team - roles and responsibilities:  what each role means and what that team member has to do.

·      Threat analysis:  where is the organisation vulnerable and what are the possible effects on the business?

·      Review response strategies:   work through checklists of response actions for each threat. 

·      Integration with outside resources:   review plans with emergency services, police, security, State disaster organisations, etc.  

·      Discuss how to communicate best with stakeholders, employees, customers, media, community, etc.

·      Technology and equipment:  where does the crisis team meet and what essential technology and equipment do they need? 

·      Log keeping and documentation:  confirm document control and efficiency program for retaining information.

·      Test and evaluate:   Using typical threat, team provides discussion on how they would respond to the crisis using the learnings.

Case studies of past crises provide important insights, background and experience. They give the team an opportunity to observe the way in which successful and unsuccessful crisis response has been handled, at the same time as evaluating how recovery was instigated.

The workshop in most cases should be first conducted at the organisation’s Head Office with the Crisis Management Team  As with all the training units in the crisis management plan, it should then be rolled out to regional and divisional business units, operations and sites.  In some cases at smaller sites, the workshop may involve teams of two or three people, but they can still carry out threat identification and the responses to their unique situation.

Don't leave crisis management training until after an event occurs. Get in front and do it now.

Crisis security for business abroad

The worst nightmare for a company is knowing that its people and assets are under siege in another country. And as anyone who has been in this situation can confirm in the midst of an escalating incident, it is the most emotional time for affected individuals and families.

Ironically, some of the methods of doing business in foreign countries designed to save money can actually put an organisation’s whole presence in that country at threat. For example, setting up a plant in an area where labour is plentiful but transport is difficult, can put security pressures on executive staff who are managing the project. They can be at risk from local criminal and political instability or their families can be at risk from the problems they may face travelling on dangerous roads.

The key to crisis management in this foreign business environment is the development of a plan that adds local knowledge and expertise to help manage the threats. Coming to terms with the most efficient response to a crisis or emergency will depend, to a great extent, on the reliability of the planning and preparation that takes place beforehand.

In a recent experience in an Asian country going through severe political change and instability, a large transport company had attempted to set up an emergency evacuation structure for their people. They were working to deal with the threat of terrorism or the possibility of politically motivated kidnapping. In certain parts of South America and Asia, there is a continuous problem with short term kidnapping for fast financial gain.

In some Asian countries, there is rarely a day that goes by where there is not some reference to a financial deal done with terrorists related to a kidnap situation.

In this case, the company was slow in putting together guidelines for protecting the organisation against potential problems. A number of employees at the company had decided to take a plan into their own hands. They decided that if their families were the victims of kidnap for ransom or any form of terrorism, they would create their own group of negotiators and deal directly with the kidnappers.

Their fear was exacerbated by an incident where the wife of one of the employees was threatened by a chauffeur driving their children to school. She fortunately was able to take control of the vehicle and drive her family to a safe situation. Her husband, with other expat friends, formed a local response group to deal with the situation, which led to a violent retaliation that involved company, government, police and consular officials. The situation did get out of control and the company was the loser. If they had a tested response plan there in the first place, the security threat would have been easier to deflect and control.

Finally, management stepped in and set up a formal crisis management plan that prescribed a security policy and offered guidance to ensure a state of pre-emergency readiness.

They worked with a private international security company to reduce the risks through a security program that identified the company’s exposures to problems in that region. Greater intelligence was gathered to ensure an understanding of the threats and appropriate measures were taken to protect the management and staff, but also to ensure continued operations.

Doing business in countries with unstable political structure calls for proactive crisis management.

Crisis management - Responsive Business Prescription

Managing the constant barrage of crises in today's rapidly changing environment will ultimately rely on the use of the internet, the inter-connectiveness of the business value chain and managing the changing information status.

Dr. John Bates, Chief Technology Officer at responsive business specialist Progress Software, proposes that businesses plug in and profit in the face of constant crisis. In the special abridged edition of his forthcoming book, Business Attention Deficit, he says that organisations need to follow simple rules:

* "Gain real time visibility of business events as they happen.
* Proactively sense and respond to opportunities and threats
* Continually improve your business using 21st century techniques
such as social media, mobility solutions and the cloud."

Dr. Bates identifies recent rapid cataclysmic crises that put modern business on a war footing. He confirms that business has to be responsive and provide a bulwark against the worst case scenario, particularly related to the Flash Crash that wiped trillions of dollars off the US stockmarkets and confounded regulators and traders, the BP oil spill in the Gulf of Mexico, escalating from an environmental crisis, and the earthquake and tsunami in Japan disrupting the supply chain in car parts and affecting the global automobile industry.

Identifying crisis threats needs to be constant. As an organisation changes, so do the threats. One year in a period of building, plant accidents may be high on the agenda and in another place, in another country, the threat of kidnap and ransom may be high on the agenda. As the organisation faces larger audiences, the threat of safety and security may be the priority. Once the threats have been identified, the priority is to determine the strategic and tactical responses that would contain, control and then recover from such an event.

Dr. Bates' book, "B.A.D. - How to plug in and profit in the face of constant crisis", was previewed at the Progress Revolution conference in Boston in 2011 and will be published in 2012.

Mine/Resource industry crisis preparedness

The mining resources industry has its fair share of risk. Some of the most sophisticated crisis management planning has been put in place by global mining and resource companies. Mining crisis management is tested, validated and integrated with emergency planning more than in most other industries. But the tragic loss of life in the mining industry continues as we saw in the recent Welsh colliery mining disaster, where the hunt for the miners ended with the news that all four miners were found dead. The tragedy played out typically through extensive live television, radio and press coverage, social media commentary and emotional family and community involvement throughout the escalation of the event.

In April 2010 in West Virginia, 29 miners were killed 1000 feet underground in the worst mining disaster in the US in 40 years. Thirty three Chilean miners were trapped in August last year in a massive cave-in. In this crisis, the miners were rescued in what was an outstanding example of rescue skills, crisis management planning and recovery. The miners were rescued after 69 days at 2,300 feet (700 m.) underground.

Currently, there is a Royal Commission of Inquiry into New Zealand's recent mine disaster in Pike River that killed 29 people. The Inquiry will examine and report on the causes of the explosions at the mine and subsequent loss of life, and all aspects of the safety regulatory regime and rescue operations at the mine.

Accidents will continue to happen. What resource companies and mining management must do is to shore up their strategic crisis management plans to link with emergency management plans, i.e.

* Be ready to make rapid strategic decisions as well as tactical response at site.
* Localise the response, while maximising corporate and strategic assistance.
* Create a tailor made plan around uniform standards.
* Train and validate plans with large simulations and training exercises.
* Start planning for recovery before a crisis occurs.
* Test critical information systems for sharing response actions.

What fundamentally distinguishes crisis-prepared from crisis-prone resource and mining organisations is their overall cultural view of crisis preparedness.

When is a crisis plan out-of-date?

Recent oil spills, product recalls and natural disasters have identified major critical gaps in crisis planning processes. Systems change, authorities shift, equipment ages, new equipment is installed and, importantly, key people move.

A rapid response will save lives and property and should ensure minimal operational interruption, but there are a number of reasons why this may not be possible:

* ownership of the crisis management program have changed
* organisational changes have occurred across the business
* management expectations of crisis preparedness have altered
* emergency and crisis interface have not been tested recently
* new threats/risks have not been incorporated into the plan
* key stakeholders need reconfirming
* internal communication systems have not been validated recently
* loss of contact with essential agencies - fire, police, medical
* new employees are not familiar with contingency plans
* impact of "social media" in crisis has not been considered
* reputational and brand issues have shifted

A regular, formal crisis audit needs to be applied to confirm that all subsidiaries and contractors maintain the currency of their crisis plans. People become lazy about preparedness for crisis and live training exercises are the only way to ensure that crisis plans are functionally up-to-date.

Unpredictable crises 2010

The Financial Times has suggested that disaster management is a growth market, particularly related to unexpected events such as the tragic deaths and subsequent oil leak in the Gulf of Mexico, the sovereign debt crisis in Greece and the ongoing volcanic ash closing down air space in Europe.

Having the resilience to control an unpredictable event is the role of crisis management and when emergency response systems can't cope, strategic crisis management needs to kick in to respond swiftly to reputational brand and governance issues. The simple questions I would ask any organisation are:

* what are the worst case scenarios that could hit your business?
* what is the most inconvenient time for this to happen?
* do you have a strategic plan to deal with it?
* who will lead your response?
* can you contact/involve your key stakeholders rapidly?
* where will you manage the response from?
* can you continue to run the rest of the business?
* what are your short and long term recovery goals?

Now is the time to plan to limit the effects of an escalating unforeseen event. With a strategic crisis plan you can.

The crisis 'blame game'

The blame game is inevitable in crises and this is particularly evident related to the Royal Commission Inquiry into the Black Saturday February 7, 2009 Australian bushfires in the State of Victoria.

Blame for the warning system, for emergency preparedness, and leadership of coordinated responses has been levelled at the Chief Fire Officer of the Authority, and further blame is now being levelled at the then Police Commissioner, who held a senior Disaster Plan responsibility and has been questioned about her failure to perform her duty on the day. She is particularly criticised for "leaving her post" although she had delegated her role to take a break for dinner.

More than ever, crisis leaders are met with increased scrutiny from key stakeholders about their strategic thinking and their integrity of leadership. What is clear is the court of public opinion's perception of their leadership in crisis. And often that is shaped by the leaders' personal attributes and values and not their response process management. Too often some media will focus on a leader's lack of integrity and decisiveness which leads to serious negative perceptions of what otherwise was a job well done.

In the end, a leader's role in times of crisis is to communicate a vision and reassure stakeholders of what is happening and the direction of the response. Every crisis leader is on "centre stage" and under public scrutiny from the beginning to the end recovery.

Reality crisis simulations

Today, crisis simulation training needs to look and feel like the real thing so that the stress and the pressure of time is felt by participants. Importantly, crisis simulations need to test leadership - is the person in charge of the crisis response able to cope with the landscape of threats? Are they cool under pressure? Will they face urgent decisions and make the final call?

Henry Kissinger once said: "In a crisis, only the strongest strive for responsibility; the rest are intimidated by the knowledge that failure will demand a scapegoat".