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Responding to Crisis: Part One – Crisis and Emotion
One of the critical things that bedevils crisis response is denial. You can refuse to confront the unpalatable truth of the circumstances and act as though this is not a crisis.
Make a Drama out of a Crisis
Many of us will remember the insurance adverts with the tagline, “We won’t make a drama out of a crisis.” Failing to make a drama out of a crisis can have fatal consequences. Psychological experiments reveal that even if you notice smoke seeping into a room, a group will ignore it until an individual shouts ‘fire’. If all but one person is previously instructed not to shout ‘fire’ as part of the experiment setup, that person can delay alerting the group until it is too late. Similarly, if you are on a train, and there is a disruptive passenger who’s actively threatening you. People ignore it until you call it and ask someone to help you. There is something in our psychology that means we will seek to ignore a crisis, even once as it is occurring.
One Sunday afternoon, I was sitting alone on a tube train when two young men entered the carriage. One sat opposite me, and the other beside me in a threatening manner. The man opposite me indicated that he had a knife inside his jacket and demanded that I give him my money. My response completely spooked them:
“If you want me to give you some money, you must ask me nicely and say ‘please’. If you get your knife out, then you will have to use it and face a murder charge, as I will not respond to threats.”
I had chosen not to ignore the emerging crisis. I intentionally escalated the situation and challenged the threat head-on. The man sitting next to me immediately got up and left the carriage. The man opposite apologised for being rude, and we had a civilised conversation, which turned into a relationship that continued for many years. Warning: don’t try this at home!
Financial Crisis
I have been involved with organisations in financial crises, and there is an instrumental part of company law which requires directors to acknowledge the potential for insolvency and change their behaviour when insolvency is threatened. Insolvency is defined as being unable to meet your commitments as they are incurred, so if you can’t pay money when it’s due, you are insolvent, irrespective of the fact that your assets may exceed your liabilities. Company law requires you to respond to that situation by shifting your focus from acting in the best interests of the shareholders to protecting your creditors. Drawing that line in the sand enables you to recognise the crisis, shift your behaviour at a point in time, start to plan differently, and start to meet your obligations differently.
Triage – No Smoke without Fire
Once you’ve acknowledged the crisis, you must call the right people and triage the situation. What are the most important things to address immediately to reduce the impact of this crisis? To mitigate the effects? To avoid it escalating even more? Come back to the smoke in the building; maybe the crisis response is to take a fire extinguisher and put out the paper that’s smoking in the waste bin.
On the other hand, if smoke is creeping under a door, then the crisis response of opening that door is entirely wrong because the likelihood is that the heat has been building up on the other side, and when you open the door, you’ll get a flashover. The fire will come into the room in which you occupy. You should seek to escape through an alternative exit. The primary requirement is to maximise your chances of surviving the fire. Calling the fire brigade will be necessary, but are there higher priorities? Setting off the fire alarm will matter, but is this the first action? Assessing the best escape route may be something that comes a little bit later.
That triage process is crucial when you’re in a business situation and a crisis hits. Depending upon the role you have in the organisation, the way you will be able to respond may be significantly different. Is this a local crisis you can handle within your own scope of control, bringing the people around you to solve and deal with it? Alternatively, is this something you can’t do much about without escalating it up the chain of command and ensuring it’s dealt with? If you are a leader, have you got a crisis management plan? Are there clear escalation paths for dealing with the crisis? How will you ensure the right people with the right expertise are in the room to make the right decisions in the correct order?
Directive or Consultative Leadership?
As a leader, you must recognise when to be highly directive to ‘stop the bleeding’. However, you may need to be more consultative to get the best input. Consider this case study from a military battle with a changing battlefield situation.
During a crucial battle during the British campaign to liberate the Falkland Islands, the initial plan could no longer survive the changing facts on the ground. The leader needed to be prepared to rely upon the information in the emerging crisis from the people on the ground and alter his plan. Sadly, in this case, the leader pursued his original plan until his death relieved him of command, and others could recover from the situation. Appropriate consulting with people in the group closest to the action is always essential, but ultimately, you need to make the difficult calls. Sometimes, you just need to take control and direct things.
Once you have Stopped the Bleeding
How do you deal with a crisis extending over a longer period? This is when you need to have a crisis management plan. You have your initial response, and now you must map out how you will deal with the crisis. Some of you may have noticed that the British Library suffered from a major ransomware cyberattack in late 2023. When the crisis hit, the head of the British Library had to deal with the immediate response: to understand how bad it was and get the information out there as quickly as possible. He also needed to build a plan for how they would respond to that crisis over the coming months. Other academic institutions or cultural institutions had taken twelve to eighteen months to recover, so understanding the whole situation, understanding the options and then having a crisis management plan became crucial. One of the things that they were able to do was to open the building physically. In their crisis management plan, the key thing they wanted to do was to ensure that no further damage could occur. Then, as they moved through a more profound understanding, they prioritised the catalogue for the most important manuscripts and books they had in their collection, providing preliminary catalogue access. Then, they built a stage plan to build that up until they were back to full service. If the crisis has enormous ramifications, you must have a thorough plan for dealing with that crisis over time.
As some of you may know, the other kind of crisis is what you might call a PR crisis. A reputational crisis. Something gets into the public domain that threatens the whole reputation of the organisation and can create extraordinary reputational damage. There, the importance of the response lies in communicating quickly, clearly, and transparently all the way through. Avoiding public denial, getting the right person in front of the media as soon as possible and in that content, ensuring appropriate responsibility is taken for what is happening.
For governments, you may face multiple crises simultaneously, which can also happen for organisations. The challenge is that the situation can escalate and become an existential threat to the organisation. The CBI, for example, had a reputational crisis which spiralled so quickly out of control that the whole organisation’s future was threatened. Yorkshire Cricket Club, again, had a reputational crisis that they failed to manage once the news broke.
Once you’ve done that initial triage, you must make sure you have a plan to deal with the crisis over time.
Conclusion
The appropriate response to a crisis depends on the urgency, magnitude and scope. Sometimes, making a drama out of a crisis is valuable. Other times, after an initial response, a measured recovery plan is the best way forward.
Charles McLachlan is the founder of FuturePerfect and on a mission to transform the future of work and business. The Portfolio Executive programme is a new initiative to help executives build a sustainable and impactful second-half-career. Creating an alternative future takes imagination, design, organisation and many other thinking skills. Charles is happy to lend them to you.