Imagine this scenario: You wake up one morning, check your company’s social media, and find out several angry customers have posted photos and videos of your product malfunctioning and threatening those people’s safety. If you don’t take the necessary crisis management steps fast and effectively, you’re in big big trouble.
Managing a crisis includes everything from stabilizing the public image of the company to making sure that profits and business do not suffer, while also focusing on public relations and your online brand reputation and monitoring.
Apart from this, businesses need to think about how a crisis will affect their customers and employees.
In this article, we’re going to go over the most important steps of managing a crisis and see how you can create an effective crisis management plan (CMP).
Without any further ado, let’s start!
Table of Contents
Updated on 03.04.2023
What is Crisis Management?
Crisis management is the steps or activities that a business takes to counter-act or respond when facing a major crisis. The prediction, planning, and forecasting of a crisis and how the business will deal with falls under crisis management.
Crisis management is one of the most important parts of public relations (PR).
The main objective of crisis management is to minimize the negative consequences while safeguarding the reputation of the business, as well as keeping everyone involved safe and secure.
Source: Giphy
When a crisis hits, you’ll know it because all crises have some common elements that are hard to miss:
- The element of surprise
- The danger of losing (a threat)
- And limited time to respond
Crisis management is a relatively younger area of management, but very crucial for the health and growth of businesses. Unlike common beliefs, crisis management starts well before disaster actually strikes.
Businesses and large organizations plan out a thorough crisis management plan (CMP) before a crisis befalls their firm.
What are the 5 Steps of Crisis Management?
There are infinite numbers of crises that can happen and of course, infinite ways to choose a crisis management approach.
While there are many strategies for dealing with a crisis, the 5-step plan is one of the most commonly used and of course, an effective one.
Here are 5 essential steps to take when it comes to crisis management:
Step1: Set Goals & Prepare a Crisis Management Plan
Nothing will fall into place if you do not have a detailed and crystal-clear crisis response plan. For this, you need to have a very clear picture of what your business objectives are, and how certain crises will affect these objectives.
From there, you should then come up with the objectives of your crisis management plan (CMR).
So, What is a crisis management plan?
Simply put, a crisis management plan is a tailor-made document containing strategies designed to help your organization in crisis.
The CMP outlines the roles and responsibilities of key stakeholders and detailed crisis communication plan guidelines. It’s usually developed in advance of any crisis, whether it’s a natural disaster or a repetitional crisis.
In the event of an unexpected event, CMP provides a clear and structured approach to minimizing damage and ensuring a quick recovery.
By implementing a Crisis Management Plan, businesses can reduce the risk of financial losses, reputation damage, and harm to people or property.
How to Create a Crisis Management Plan?
There is a lot of thought and prediction that goes into creating a crisis management plan. A lot of foresight is required.
It’s hard to predict what your company will face, especially if you don’t have a very large company, or have been sailing along for a while.
These things often lull businesses into a false sense of security, which can be devastating in times of crisis. So, to avoid this, plan from the start, and plan carefully!
Here are 3 steps to create a crisis management plan:
- Identify all people, stakeholders, customers, employees, suppliers, etc., who will be affected by this, and how they’ll be affected.
- Then lay down a plan for how to cover up the losses with each of them. More importantly: all these people need to know what’s going on.
- Once you have all these clear objectives in mind, put together a detailed plan that includes all the relevant documents and legal actions.
In this plan, you should outline every action you need to take about every area of your business. Distribute this plan to everyone at the company.
In addition, the plan should be modified and updated periodically based on the business flow. Also, never forget to include financial and legal experts when writing a crisis management plan. They can help you greatly in this process.
Also, you can use a crisis management plan template if you prefer. However, since the types of crises that might happen for a business can differ from case to case, we suggest you work on a unique one.
Step 2: Put Together a Dedicated Team
One of the most common mistakes, which businesses often make is believing that all hands-on deck at the moment of crisis is the actual way to go.
But this can be the recipe for an even bigger disaster.
As far as crisis emergency management strategies go, the most efficient way of dealing with a crisis is to have an entire team that is dedicated solely to this purpose.
The crisis management team should comprise senior executives, who have the sole responsibility of working on crisis management.
From the onset, they should start with the prediction and brainstorming on what kind of crisis the company may face.
The planning, prediction, as well as action course, should be decided by this team. It is imperative to be careful about the personnel that will be there on this team.
It should be ideally headed by the CEO, and he or she should be advised by the senior members of the Public relation department, as well as the senior legal executives of the firm.
Additional members may be the heads or supervisors of all the other major departments of the business.
Another great idea is to have specialists, that is subject specialists, on the team. Provide special training to people if you have to, and never keep crisis management on the back burner, waiting for the time of crisis.
Rather, it should be ideally a weekly practice to discuss, update, and review any possible crisis by the business during that time, and the possible ways to prevent and handle it.
If you believe that your business does not have enough expertise or expert people to be a crisis manager, then another great option is to choose a legal firm or a crisis management firm that specializes in this sort of thing.
Step 3: Keep the Communication Flowing
Having a crisis communication strategy is one of the crucial steps of crisis management. That is to have an open and well-oiled communication network.
The first step is to inform all the parties concerned about potential risks and crises, including employers, stakeholders, the public, legal parties, and customers. As soon as possible, hire a crisis situation spokesperson who’s well-trained and well-informed.
There’s always going to be media coverage if a crisis impacts the public as well as customers. The spokesperson’s job is to be the voice of the company, ready to answer all the questions and apprehensions of the public, media, and employees.
Another key element here is, to be honest, and transparent.
Even though a crisis can’t be undone, you can avoid further negative publicity by being honest. This should be handled delicately, and with a positive vibe.
When a crisis arises, deal it with honesty and transparency! Click To TweetAlso, keep the workforce up-to-date, especially in times of crisis. This prevents a frenzy amongst the employees and reduces ill-will, and employees feel like they’re part of the team.
This in turn prevents them from spreading ill rumors in times of crisis.
Be sure to keep all concerned parties updated about every small improvement or bad turn. Also, make sure to have summary statements ready accordingly.
You also want to make sure your legal spokesperson and crisis spokesperson is on the same page and can deliver satisfactory, honest statements.
Another thing to keep in mind is to use social media extensively to keep everything in a positive light, and to portray that you have nothing to hide.
Step 4: Prevent the Crisis
This is a finer aspect of the crisis management steps missed by many.
If you are on the right path to crisis management, then from the onset, you will have laid out clear objectives of your crisis management plan.
With this, you will have predicted what kind of crisis your company may face. One major step that most companies don’t consider to be part of crisis management is to actually prevent the situations that have been predicted as a possible crisis.
This means to have your work laid out for you. All the deadlines, finances, and legal matters must be kept up to date and in line.
Sometimes, after some initial brainstorming, it is easy to see how some crises can be avoided by simply changing the existing methodologies and operations.
Evaluate your company’s policy, philosophies, and strategies. Wherever there is a danger of missing a deadline, let the stakeholders know well in advance.
Always know how to appease the concerned parties, as well as have genuine reasons for any hiccups. Before a mountain arises out of a molehill, try to get everything in line timely.
More often, crises arise due to ignorance of the small, seemingly important issue, which eventually adds up to a huge crisis.
Avoid this at all costs. A well-managed firm is less likely to run into a major crisis, than one that has sloppy management and organizational practices.
Keep the HR well-trained and up-to-date. Have a dedicated team with the sole purpose of being on the lookout for a crisis. Most important of all, your PR team should be on top of their game. Any sloppiness or slight misstep from the PR at the time of crisis could lead to unimaginable disasters.
More often than not, crisis arise due to ignorance of small, seemingly an important issue, which eventually adds up to a huge crisis! Click To TweetStep 5: Anticipate it
This just doesn’t mean sitting around and thinking “I am ready for a crisis” or “I have a plan when disaster hits”.
Anticipating crisis in real terms means knowing that each and every one of your steps, or missteps, may be leading you to a potential crisis.
Every hiring, firing, office gossip, unsatisfied employees, poor customer service, unpaid holidays, HR mistakes, and shouting matches with junior resources may have all contributed to that crisis.
Before taking any step, think about its consequences. Even the slightest data error, technical, financial, or legal, maybe just the leap toward a crisis.
Bad publicity, accusations, and any other negative behavior that is usually taken lightly are actually the building blocks of a crisis.
Another thing that is often overlooked during crisis management is your cyber security.
Security breaches, hacks, and leaks are often the sparks that start the blaze of a crisis. Most companies that are not in the IT field think it is alright not to have a dedicated IT department.
This is their first mistake. Have an IT wing, and more importantly, have an up to date IT and network security including robust antivirus software to keep all your confidential information as well as business exchanges safe.
Remember that, a crisis that is not handled gracefully can obliterate decades of hard work and dedication in a matter of days or even hours. Your company’s good name, its brand value, as well as its market value can hit rock bottom, or in fact, hit an irrecoverable low if the crisis is not dealt with properly.
If your company emerges victorious from a crisis, it raises the respect and value of your company even more. It shows the world that your firm has the necessary operations and processes when it comes to dealing with unpleasant situations.
Tips to Detect a Crisis in Early Stages
Except for being prepared and anticipating a crisis, some sophisticated signs might indicate an upcoming one. Here are some of the things that you can do to see the signs early on:
Monitor Social Media:
Social media can be a powerful tool for detecting potential crises early on. You can proactively address any issues that arise by monitoring social media channels for negative comments or complaints about your brand.
Mentionlytics’ brand management platform, can help you monitor your brand’s mentions across all web and social sources just by just a glance at your media monitoring report and successfully manage an upcoming crisis.
Mentionlytics is a media monitoring and social listening tool that can track mentions of a brand, product, or service name across various social media platforms. It can also monitor keywords and hashtags related to the brand or industry.
By using Mentionlytics, you can detect early warning signs of a crisis before it escalates, and take proactive steps to address it.
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Follow Industry News & Trends
Knowing what’s going on in your industry can help you identify issues that may affect your business. Your business may be disrupted by changes in regulations, economic trends, or emerging technologies.
Listen to Employee Feedback
It’s often your employees who notice issues first. Make sure your employees are able to communicate easily and give you feedback.
Perform Regular Risk Assessments
You can find out potential threats and vulnerabilities by conducting regular risk assessments. You can spot any cyber-attacks, and supply chain disruptions that might affect your business.
Now Over to You
In this article, we covered the most important crisis management steps that any business should follow.
Surely, this is a long-term process and no crisis is without a certain amount of damage. However, following this crisis preparedness, you can mitigate the damage and most importantly, recover from it in post-crisis times.
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