Comprehensive Comprehensive Crisis Crisis

ManagementManagement with special emphasis with special emphasis

on on

HUMAN-CAUSED CRISESHUMAN-CAUSED CRISES

Ian I. MitroffIan I. Mitroff

© 2006© 2006

Before During Before During After After

1. Crisis Types1. Crisis Types

2. Crisis 2. Crisis MechanismsMechanisms

3. Crisis 3. Crisis SystemsSystems

4. Crisis 4. Crisis StakeholdersStakeholders

Expose Expose WeaknesseWeaknesses s

BuildBuild CapabilitCapabilitiesies

EnactEnact CapabilitCapabilitiesies

Learn Learn RedesignRedesign

To Enact Is NOT To To Enact Is NOT To ReactReact

To Enact Is To Be To Enact Is To Be ProactiveProactive

1. Crisis Types

1. Crisis Risks

The Manager’s Crisis Index :

The Lukaszewski GroupPotential Crisis SituationsA

Abortion

Accidents

Adverse Government Actions

AIDS

Anonymous Accusers

WWhistleblowers

Over 120 items & the list seems endless!!

Situation Hopeless??

CRISIS FAMILIES

EXT ECON ATTACKS

EXT INFO

HR / REP

PSYCHO

OCCUP-HEALTH

MEGA-DAMAGE

ORG / SOC

TECH / ECON

BREAKS

CRIMINAL

LEGAL

NATURAL DISASTERS

GOVT REGULATORY

Breaks

Loss of Key Equipment, Plants, Supplies

Breakdown of Key Equipment, Plants

Loss of Key FacilitiesMajor Plant Disruption

Psycho/Criminal

Product TamperingKidnappingHostage TakingTerrorismWorkplace Violence

Economic

Labor StrikesLabor UnrestLabor ShortageMajor Decline in Stock Price and Fluctuations

Market CrashDecline in Major Earnings

Human Resource

Loss of Key Executives, Personnel Rise in AbsenteeismRise in Vandalism and AccidentsWorkplace Violence

Informational

Loss of Proprietary and Confidential Information

False InformationTampering with Computer RecordsLoss of Key Stakeholder Information

Natural

EarthquakesFiresFloodsExplosionsTyphoonsHurricanes

Reputation

SlanderGossipSick JokesRumorsDamage to Corporate ReputationTampering with Corporate Logos

CRISIS FAMILIES

EXT ECON ATTACKS

EXT INFO

HR / REP

PSYCHO

OCCUP-HEALTH

MEGA-DAMAGE

ORG / SOC

TECH / ECON

BREAKS

CRIMINAL

LEGAL

NATURAL DISASTERS

GOVT REGULATORY

TT

FFNORMALNORMALABNORMALABNORMAL

CRISIS FAMILIES

EXT ECON ATTACKS

EXT INFO

HR / REP

PSYCHO

OCCUP-HEALTH

MEGA-DAMAGE

ORG / SOC

TECH / ECON

BREAKS

CRIMINAL

LEGAL

NATURAL DISASTERS

GOVT REGULATORY

TT

FFNORMALNORMALABNORMALABNORMAL

NN SS

Which Family Is Planned For Most and

Why?

CRISIS FAMILIES

EXT ECON ATTACKS

EXT INFO

HR / REP

PSYCHO

OCCUP-HEALTH

MEGA-DAMAGE

ORG / SOC

TECH / ECON

BREAKS

CRIMINAL

LEGAL

NATURAL DISASTERS

GOVT REGULATORY

TT

FF

BREAKS

NORMALNORMALABNORMALABNORMALNN SS

Which Family Is Planned For Least and

Why?

CRISIS FAMILIES

EXT ECON ATTACKS

EXT INFO

HR / REP

PSYCHO

OCCUP-HEALTH

MEGA-DAMAGE

ORG / SOC

TECH / ECON

BREAKS

LEGAL

NATURAL DISASTERS

GOVT REGULATORY

TT

FF

PSYCHO

NORMALNORMALABNORMALABNORMALNN SS

CRIMINAL

2. InterventionsCrisis Mechanisms

2. CRISIS PHASES

The 6 Phases of CM

Signal Detection

SDM’s for:Any Crises?

Build on Existing Data Bases?

Integrated?

Types of Signals, Noise?

Blockers?

Transmitted to Whom?

Actions?

Internal Assassin Team Exercise?

--- ---Signal Signal

Received?Received?

Signal Signal Detector Detector Exists?Exists?

---Signal Signal TransmittedTransmitted??

---Signal Signal Received By Received By The Right The Right Person?Person?

---

Signal Signal Related To Related To An Org An Org Problem?Problem?

---Actions Actions Taken?Taken?---

Signal Signal Related To Related To An Org An Org Actions?Actions?

ORGANIZATIONAL Signal DetectionORGANIZATIONAL Signal Detection

---

Signal Signal Correctly Correctly InterpretedInterpreted??

Types of SignalsTypes of Signals

ExternExternalal

InternInternalal

PeoplePeople

TechnicTechnicalal

CommunitiesCommunitiesSpecial Special InterestsInterestsMediaMediaConsumersConsumers

Remote SensingRemote SensingGovernment Government MonitoringMonitoringIndustryIndustryScientific Scientific ResearchResearch

Gossip / Gossip / RumorsRumorsPersonal Personal NetworksNetworksThe CultureThe Culture

Personal Data Personal Data BasesBasesPCsPCsITIT

SignalsSignals

TypesTypes

EconomicEconomic

ReputationalReputational

Internal Internal External External

Tech Tech People People

Tech Tech People People

?? ?? ?? ???? ?? ?? ??

The 6 Phases of CM

Probing/

Signal Detection

Mandatory?

Formal Failure Analyses?

Rewarded?

Blame the Messenger?

Organizational Status?

Preparation

The 6 Phases of CM

Signal Detection

Damage Containment Damage Containment

CRISIS

Maintained? Updated?

APPROPRIATE TYPES?

Physically Contain? Buffer? Wall Off?

Disperse? Decay?

Neutralize? Treat? Convert?

Dilute? Reduce Concentration?

Deflect? Redirect?

Probing/Preparation

The 6 Phases of CM

Damage Containment

Physically Contain? Buffer? Wall Off?

Disperse? Decay?

Neutralize? Treat? Convert?

Dilute? Reduce Concentration?

Deflect? Redirect? Rebound?

Transparency? Tear Down Walls?

Open/Expose?

The 6 Phases of CM

Signal Detection

Damage Containment

Business Recovery

Damage Containment

Business Continuity

Minimum Services?

Most Important Stakeholders?

Off-site, On-Site?

Backups?

Hot/Cold Sites?

Probing/Preparation

The 6 Phases of CM

Probing/Preparation

Signal Detection

Damage Containment

Business Recovery

No-Fault Learning

Damage Containment

Formal Reviews?

Near Misses?

No Blame?

Generalize Learning?

The 6 Phases of CM

Probing/Preparation

Signal Detection

Damage Containment

Business Recovery

No-Fault Learning

Redesign

Damage Containment

Actually Implement Changes?

The 6 Phases of CM

Probing/Preparation

Signal Detection

Damage Containment

Business Recovery

No-Fault Learning

Redesign

Damage Containment

PROACTIVE REACTIVE

INTERACTIVE

3. Root Causes

3. CRISIS SYSTEMS

SYSTEMS1. Technology

5. Top Mgt 5. Top Mgt PsychologyPsychology

4. Culture

3. Human Factors

2. Org Structure1

23

4

5

Critical Issues

1. Technology Complexity Design Knowledge Age / Standardization Controls / Risks

2. Org Structure Layers Rewards Jobs Information Channels Business Strategies4. Org Culture Safety : Crisis Prepared Crisis Prone

3. Human Factors Operator Interface Org Interface

5. Top Mgt Psychology Decision Styles Risk Conflict Styles Family History Education

The Systems Dynamics of BHOPAL

Initial Crisis: -$

Poor Design

Poor Maintenance

Low Morale

Poor Safety Standards

Poor Infrastructure

Poor Safety

The Final Crisis

Cost-Cutting

Organizational Issues

Well-Trained CM Team?Appropriate Functions?

Facilitate?Conflict Management?

Org Flexibility?Share Resources?

Human Factors

Three-Mile IslandAmtrak

Mental-Map Conferences?KNOWLEDGE-BASED

Designers, Operators,Maintenance?

OK NOT

ORGANIZATIONAL CULTUREDangerous

RationalizationsOur size will protect us.

Excellent companies don’t have crises.

Our location will protect us.

Certain crises only happen to others.

If a crisis happens, someone will rescue us.

CM is someone else’s responsibility.

Each crisis is so unique that it is pointless to prepare.

OVER 30 KEY RATIONALIZATIONS!!!

Shared Freudian Defense Shared Freudian Defense MechanismsMechanisms

1. Denial1. Denial

2. Disavowal2. Disavowal

3. Idealization3. Idealization

4. Grandiosity4. Grandiosity

5. Projection5. Projection

6. 6. IntellectualizationIntellectualization

7. 7. CompartmentalizatioCompartmentalizationn

1. Invulnerability1. Invulnerability

2. Impacts Negligible2. Impacts Negligible

3. We Don’t Have 3. We Don’t Have ProblemsProblems

4. We’re Big & Powerful4. We’re Big & Powerful

5. Someone Else to Blame5. Someone Else to Blame

6. Probabilities Small6. Probabilities Small

7. Can’t Affect the 7. Can’t Affect the Whole Whole

SystemSystem

IndividuaIndividuall

OrganizationOrganization

The Impact of Culture

CM

Preparation

Number of Dangerous Rationalizations

Crisis Prone = 7 X Crisis Prepared !!

4. Affected Parties

4. STAKEHOLDERS

Stakeholder AnalysisINTERNATIONAL

CORE

EXTERNAL

NATIONAL

INTERNAL

BELIEFS

POWER

VALUES

RESOURCES

INFLUENCE

CULTURAL

I

I

III

II

IV

Crisis StakeholdersCrisis Stakeholders

OrganizatioOrganizationn EmployeesEmployees

CompetitiCompetitionon

Top ManagementTop Management

MediaMedia

Special Special InterestsInterests

GovernmentsGovernmentsPower/ Power/ ReputatiReputationon

InformatiInformationon

ResourceResourcess

InfluencInfluencee

BanksBanksUnionsUnions

Stakeholder Analysis

The San Diego Zoo

Least Important

Most Important

Certain

Uncertain

Scientific Reputation

Employee Loyalty

Sister Organizations

Stakeholder Analysis

The San Diego Zoo

Least Important

Most Important

Certain

Uncertain

Scientific Reputation

Sister Organizations

Employee Loyalty

WRONG!

WRONG!

WRONG!

AN IDEAL CM PROGRAM

1. CM A TOP CORPORATE PRIORITY!!

2. A Robust CRISIS PORTFOLIO

3. Constantly Improve Signal Detection / Probing /

Damage Containment

4. Constantly Audit Systems: Technology X

Culture 5. Constantly Audit / Incorporate Stakeholders

6. PRE-TRAUMA Training / Simulations

7. Integrate CM With TQM , Safety , IM , Environmentalism