Crisis Management - Introduction

Prithwi Tilak Banerjeebanerjee@bakhtar.edu.af0747007009/0776660888

Before During After1. Crisis Types2. Crisis Mechanisms3. Crisis Systems4. Crisis Stakeholders Expose Weaknesses Build Capabilities Enact Capabilities Learn Redesign To Enact Is NOT To React To Enact Is To Be Proactive

1. Crisis Types1. Crisis Risks

The Managers Crisis Index :The Lukaszewski GroupPotential Crisis SituationsAAbortionAccidentsAdverse Government ActionsAIDSAnonymous AccusersWWhistleblowersOver 120 items & the list seems endless!!Situation Hopeless??

CRISIS FAMILIESEXT ECON ATTACKSEXT INFO HR / REP PSYCHOOCCUP-HEALTHMEGA-DAMAGEORG / SOCTECH / ECONBREAKS CRIMINALLEGALNATURAL DISASTERSGOVT REGULATORY

Breaks

Loss of Key Equipment, Plants, SuppliesBreakdown of Key Equipment, PlantsLoss of Key FacilitiesMajor Plant Disruption

Psycho/Criminal

Product TamperingKidnappingHostage TakingTerrorismWorkplace Violence

Economic

Labor StrikesLabor UnrestLabor ShortageMajor Decline in Stock Price and FluctuationsMarket 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 InformationFalse InformationTampering with Computer RecordsLoss of Key Stakeholder Information

Natural

EarthquakesFiresFloodsExplosionsTyphoonsHurricanes

Reputation

SlanderGossipSick JokesRumorsDamage to Corporate ReputationTampering with Corporate Logos

CRISIS FAMILIESEXT ECON ATTACKSEXT INFO HR / REP PSYCHOOCCUP-HEALTHMEGA-DAMAGEORG / SOCTECH / ECONBREAKS CRIMINALLEGALNATURAL DISASTERSGOVT REGULATORYTFNORMALABNORMAL

CRISIS FAMILIESEXT ECON ATTACKSEXT INFO HR / REP PSYCHOOCCUP-HEALTHMEGA-DAMAGEORG / SOCTECH / ECONBREAKS CRIMINALLEGALNATURAL DISASTERSGOVT REGULATORYTFNORMALABNORMALNS

Which Family Is Planned For Most and Why?

CRISIS FAMILIESEXT ECON ATTACKSEXT INFO HR / REP PSYCHOOCCUP-HEALTHMEGA-DAMAGEORG / SOCTECH / ECONBREAKS CRIMINALLEGALNATURAL DISASTERSGOVT REGULATORYTFBREAKSNORMALABNORMALNS

Which Family Is Planned For Least and Why?

CRISIS FAMILIESEXT ECON ATTACKSEXT INFO HR / REP PSYCHOOCCUP-HEALTHMEGA-DAMAGEORG / SOCTECH / ECONBREAKSLEGALNATURAL DISASTERSGOVT REGULATORYTF PSYCHONORMALABNORMALNS CRIMINAL

2. InterventionsCrisis Mechanisms2. CRISIS PHASES

The 6 Phases of CM Signal DetectionSDMs for:Any Crises?Build on Existing Data Bases?Integrated?Types of Signals, Noise?Blockers?Transmitted to Whom?Actions?Internal Assassin Team Exercise?

------Signal Received?Signal Detector Exists?---Signal Transmitted?---Signal Received By The Right Person?---Signal Related To An Org Problem?---Actions Taken?---Signal Related To An Org Actions?ORGANIZATIONAL Signal Detection---Signal Correctly Interpreted?

Types of SignalsExternalInternalPeopleTechnicalCommunitiesSpecial InterestsMediaConsumersRemote SensingGovernment MonitoringIndustryScientific ResearchGossip / RumorsPersonal NetworksThe CulturePersonal Data BasesPCsIT

SignalsTypesEconomicReputationalInternal External Tech People Tech People ????????

The 6 Phases of CM Probing/ Signal DetectionMandatory?Formal Failure Analyses?Rewarded?Blame the Messenger?Organizational Status?Preparation

The 6 Phases of CM Signal Detection Damage Containment Damage ContainmentMaintained? 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 ContainmentBusiness Recovery Damage ContainmentBusiness ContinuityMinimum Services?Most Important Stakeholders?Off-site, On-Site?Backups?Hot/Cold Sites? Probing/Preparation

The 6 Phases of CM Probing/Preparation Signal Detection Damage ContainmentBusiness RecoveryNo-Fault Learning Damage ContainmentFormal Reviews?Near Misses?No Blame?Generalize Learning?

The 6 Phases of CM Probing/Preparation Signal Detection Damage ContainmentBusiness RecoveryNo-Fault Learning Redesign Damage ContainmentActually Implement Changes?

The 6 Phases of CM Probing/Preparation Signal Detection Damage ContainmentBusiness RecoveryNo-Fault Learning Redesign Damage ContainmentPROACTIVE REACTIVEINTERACTIVE

3. Root Causes3. CRISIS SYSTEMS

SYSTEMS1. Technology5. Top Mgt Psychology4. Culture3. Human Factors2. Org Structure12345

Critical Issues1. Technology Complexity Design Knowledge Age / Standardization Controls / Risks2. Org Structure Layers Rewards Jobs Information Channels Business Strategies4. Org Culture Safety : Crisis Prepared Crisis Prone3. Human Factors Operator Interface Org Interface5. Top Mgt Psychology Decision Styles Risk Conflict Styles Family History Education

The Systems Dynamics of BHOPALInitial Crisis: -$Poor DesignPoor MaintenanceLow MoralePoor Safety StandardsPoor InfrastructurePoor SafetyThe Final CrisisCost-Cutting

Organizational Issues Well-Trained CM Team?Appropriate Functions?Facilitate?Conflict Management?Org Flexibility?Share Resources?

ORGANIZATIONAL CULTUREDangerous Rationalizations

Our size will protect us.Excellent companies dont have crises.Our location will protect us.Certain crises only happen to others.If a crisis happens, someone will rescue us.CM is someone elses responsibility.Each crisis is so unique that it is pointless to prepare.OVER 30 KEY RATIONALIZATIONS!!!

Shared Freudian Defense Mechanisms1. Denial2. Disavowal3. Idealization4. Grandiosity5. Projection6. Intellectualization7. Compartmentalization1. Invulnerability2. Impacts Negligible3. We Dont Have Problems4. Were Big & Powerful5. Someone Else to Blame6. Probabilities Small7. Cant Affect the Whole System

IndividualOrganization

The Impact of CultureCM PreparationNumber of Dangerous Rationalizations

4. Affected Parties4. STAKEHOLDERS

Stakeholder AnalysisINTERNATIONALCOREEXTERNALNATIONALINTERNALBELIEFSPOWERVALUESRESOURCESINFLUENCECULTURALIIIIIIIIV

Crisis Stakeholders OrganizationEmployeesCompetitionTop ManagementMediaSpecial InterestsGovernmentsPower/ ReputationInformationResourcesInfluenceBanksUnions

Stakeholder Analysis

Least ImportantMost ImportantCertainUncertainScientific ReputationEmployee LoyaltySister Organizations