An organization’s response to a crisis will challenge and directly impact its brand and reputation. A crisis can inflict unexpected expenses related to customer inquiries, internal policy reforms, and extensive legal fees and settlements. Neglecting to create a crisis management plan may result in financial and reputational damages, and your organization may experience extensive disruptions or closing of operations permanently.
Assess Your Risks and Establish Goals
Initiating a crisis management plan begins with critically evaluating adverse events that are most likely to impact your operations. Some common threats to businesses include:
Product recalls, employee safety concerns, public relations blunders, active shooter incidents, acts of terrorism, civil unrest, communicable disease outbreaks
Earthquakes, fires, floods, hurricanes, ice storms, tornadoes
Workplace violence, employee strikes, sexual harassment, leadership errors and wrongdoings, kidnappings, illegal or unethical employee misconduct
Product or service demand drop, bankruptcy, stock price concerns
Cyberattacks, data loss, confidential or proprietary information mismanagement
In addition, it is critical to establish defined goals to implement a successful responsive action. Common objectives include:
- Protecting employees and the general public from serious injuries
- Preventing or minimizing damage to property, company finances, company assets or the environment
- Safeguarding the company’s reputation
- Maintaining operations or returning to business as usual following a disruption
Create a Crisis Management Team
Choosing the right individuals for a crisis management team will help you create and execute an official plan. A crisis management team should include a crisis team leader, crisis coordinator, communications coordinator, legal counsel, human resources coordinator and support staff.
Your crisis management team will be tasked with:
- Evaluating each crisis situation
- Determining the threat level of each crisis situation and the appropriate response
- Identifying outside experts to help execute or improve crisis response efforts
- Coordinating with the proper authorities
- Crafting and executing communication strategies
- Reviewing and improving the crisis management plan on a regular basis
Identify Stakeholders and Consider Communication Channels
The crisis management plan should designate communication channels for alerts and updates. Prior to choosing your preferred channels, the team must identify specific stakeholders to reach during an emergency.
These individuals and entities will likely differ depending on the incident but may include:
- customers and clients
- employees and their families
- regional media
- general public
- company management and directors and officers
- investors and shareholders
- board members
- government organizations, regulators and other authorities
Set Alert Levels
An alert system will ensure your organization and crisis management team know how to respond to individual crises. This system will rank various operational threats and outline recommended response tactics.
Level 4 – Major Crisis
- The incident:
- is considered to be a severe emergency.
- severely impairs or disrupts the business’ operations or its stakeholders.
- has led to injuries or fatalities.
- has majorly damaged the business.
Level 3 – Crisis Warning
- A major emergency is impacting the organization and disrupting normal operations and multiple business units.
- The incident poses a considerable threat to personnel, customers, clients, external resources (e.g., supply chain members) or the business’ reputation.
- To remedy the situation, quick responses and decision making are required.
Level 2 – Potentially Critical
- An incident is currently impacting business operations but is localized, isolated and minor. It could be exacerbated if corrective actions are not taken.
Level 1 – Minor Incident
- A non-serious incident is impacting business operations. Damage or business interruptions are localized.
Level 0 – Normal Operations
- No outside factors are currently impacting the organization.
Practice the Crisis Management Plan
Implementing a crisis management plan includes integrating the plan into your operations and training employees. This can be accomplished with tabletop exercises.
During a tabletop exercise, the crisis management team is asked to consider:
- Expectations of the crisis management team and all other employees in the event of an emergency
- Specific organizational risks in light of a particular crisis
- Defenses and resources available to combat the crisis
- Communication options available to the crisis management team and all other employees
- How customers will be affected and situational responses
- Security of company data and assets
- Directives in which to respond to certain situations
Predicting when a crisis will occur is impossible, but making preparations is imperative. A proper plan will provide your organization with tools to weather a variety of different disasters. A crisis management plan will also include the right insurance to help with recovery efforts. To learn more about your options, contact a member of our team today.
Download our Disaster Preparedness Guide to help ensure your business can recover and resume operations quickly and efficiently.