Crisis Management – Learning from Mistakes
Updated: Mar 3, 2021
Crisis Management is not a new concept. In fact for several decades now, the subject has been taught at leading universities around the world and is generally accepted as a key management competence. If we acknowledge that much has been done to enhance crisis preparedness and response, then why do organizations continue to make the same mistakes?
Broadly speaking, in terms of crisis preparedness, we can divide organizations into three categories: those that have no plans in place; those that have a plan in place that is sporadically reviewed, budget permitting; and those that have established processes and competency programs that are diligently reviewed, practiced and maintained.
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Indeed, looking at the second and third category, many multinational corporations and businesses of varying sizes have tried-and-tested crisis systems in place. Yet, slow response, withholding information and denial – which can affect public safety, trust, and ultimately brand and corporate reputation – are some of the common mistakes that are being repeated. In the best cases, standards improve and organizations survive and rebound. In the worst cases, they don’t. Trusted and long-standing corporate icons disappear, or are acquired for a bargain price before being rebranded.
It is useful to recall a few fundamental planning principles that can help organizations avoid repeating mistakes and emerge stronger post-crisis.
1. Commitment and Leadership
Increasing crisis resilience and vigilance must be mandated from the top of the organization and implemented by all, under the watchful eyes of the crisis custodians (those responsible for implementing and maintaining the crisis management process). Top leaders must personally propagate and sustain this commitment by being directly involved before, during and after the crisis.
Effective crisis management is not about winning or losing or finding the perfect solution. It is about holding the course, doing the right thing and protecting credibility in the face of tremendous adversity and stakeholder pressure. An organization with an embedded commitment to being fit and ready to anticipate, detect, manage and learn from adversity is more likely to bounce back faster, protect its reputation and increase resilience in the process.
2. Crisis Management is an Investment
Crisis preparedness is a corporate life-jacket: although seldom used, it must be there and must work well when needed. As long as organizations continue to consider crisis preparedness a cost and not an investment, mistakes will be made and repeated. There is ample and recurring evidence of the devastating losses of corporate crises: human lives, assets, market share, share price, ruined reputations and so on. So why are crisis management programs still often cut from budgets?
Fortunately, for most organizations crises are relatively rare. Having a plan in place is not enough to build the kind of reflexes needed to face up to a true crisis. Crisis management competencies must be developed via regular training and practice. Crisis simulations are the only truly effective tools to prepare teams for the stresses and pressures of crises and help embed the resilience needed to manage the unpredictability and complexities of today’s crises.
4. After Action Reviews
Often when a crisis is over, teams are so eager to return to “business-as-usual” that they neglect the critical task of self-examination and reflection and miss the opportunity to implement improvement programs so that the same mistakes are not repeated.
“We do not learn from experience… we learn from reflecting on experience”, said John Dewey. So, after each crisis and after every crisis exercise, a rigorous reflection and evaluation process must be undertaken to capture and share lessons learned and to close gaps. Commonly termed AAR (After Action Review), this post-crisis/exercise task must be carefully planned and facilitated to generate meaningful and lasting improvements. Furthermore, the development of case studies to encourage cross-organizational sharing and learning is a key way to prevent the repetition of mistakes.
5. Values and Culture
Organizations must uphold and protect their values. At no time is this tested more than during crises.
Building a crisis resilient organization is not just a question of processes and competencies, but also of values such as ownership, transparency, ethics, regret, and corrective actions. Organizations that “walk the talk” are more likely to survive and emerge stronger from crises than those who do not.
Building a culture that focuses on long-term credibility and trust rather than quick fixes is at the heart of best-practice crisis management. It helps to foster resilience and to prevent reoccurrences.
Today the complexities of managing crises in a globally connected world call for a generative crisis management culture that aims to build high reliability organizations that learn from their mistakes.