Take action when leading in a crisis
In an earlier article, we discussed the value of risk management. We explored how it’s possible to prepare for crises and how the right approach might even help to prevent some from occurring in the first place. This article explores how to take action when leading in a crisis.
Significantly, we accepted that total immunity is unattainable. As crisis is largely unpredictable by nature and therefore highly likely to catch us by surprise. We also noted that in the end, when a crisis does strike, it’s a company’s leaders who have to steer the ship and take action when leading through the storm.
So now let’s look more closely at what action a leadership team should take when, for whatever reason, an organisation strays into troubled waters. In doing so, crucially, let’s assume that an effective risk-management strategy has already provided some insight into both the potential impact of a particular crisis and what the general response to it should be.
Facing the music
A popular reaction for a leader faced with a crisis is to cover his or her own back. After all, self-preservation invariably has a certain appeal. But this is unlikely to help the cause of a business as a whole.
It may first be necessary, then, to confront some harsh truths. Leaders might usefully reflect on their own roles in both bringing about and tackling a crisis. They might also accept that they should be among the first people to make sacrifices if tough choices are required.
This done, it’s vital to develop a consensus on the root causes of the problem. Without which, of course, no meaningful solutions can be conceived. This demands transparency and commitment rather than quick fixes and concealment. These will only make things worse.
As mentioned in the previous article, the crisis is very seldom confined to the business itself. It can spread in many directions, including an organisation’s consumer base. This is why upfront dialogue with all stakeholder groups is essential.
Employees are especially important here because they’re likely to be the principal victims of the uncertainty and fear that crisis generates. The most forward-thinking companies involve workers in the risk-management process from the start. There’s no excuse whatsoever for keeping them out of the loop once a crisis has arisen.
Since job security tends to be foremost in employees’ minds, reassurances are needed. If redundancies are deemed necessary then the implications – including the scope for redeployment – must be outlined in full. Consultations should always encompass workers and, if they’re present, unions. Clarity and honesty greatly increase the chances of weathering the storm.
Safeguarding the future
It’s not uncommon for a company to lose much of its top talent while dealing with a crisis that’s eminently survivable. Such an exodus usually occurs because a rudimentary act of damage limitation is overlooked.
The fact is that reticence suggests instability or, maybe worse still, aimlessness. Employees – especially those who can easily find jobs elsewhere – are more likely to jump ship if the captain and his closest aides give an impression of having no idea what to do. This is one of the reasons it’s’ important to take action when leading through a crisis.
If managers are open and inclusive in their handling of a situation, as advocated above, employees might find a good reason to stick around. If managers provide insufficient information, as is so often the case, employees might find a good reason to leave.
Turning a negative into a positive
Relatedly, it’s worth remembering that a crisis frequently demands new and creative ways of thinking. Nobody should be left out of this process.
Genuinely company-wide engagement could produce novel solutions and answers. These might serve an organisation well not just during the turmoil but beyond. Thus what began as a would-be disaster is transformed into a platform for positive change.
Moreover, this change could be radical. Proposals that have fallen on stony ground during less turbulent times have a better chance of finding favour during a period of disorder when they can be implemented in the name of crisis management.
It’s worth reiterating that crisis can strike a business at any time and in any form. It’s also worth reiterating that there are no known miracle cures. It pays to be prepared. But even the best preparation doesn’t obviate the need to take action when a storm finally envelops an organisation.
Any attempt to find calmer waters is more likely to succeed if leaders follow a handful of simple guidelines. To summarise: identify the problem, guard against uncertainty, involve everyone. Then look for opportunities to turn the experience into something positive for the longer term.
There’s no denying that a crisis is unpleasant. But a leadership team that keeps a level head and turns the tables to it’s business’s advantage might well see its organisation emerge from the tumult not only intact but more successful and efficient than before.
David Falzani MBE is an Honorary Professor at Nottingham University Business School’s Haydn Green Institute for Innovation and Entrepreneurship and president of the Sainsbury Management Fellowship.
Nottingham University Business School specialises in developing leadership potential, encouraging innovation and enterprise, and developing a global outlook in its students, partners, and faculty. It is recognised as one of the world’s top business schools for integrating responsible and sustainable business issues into its undergraduate, MBA, MSc, PhD, and executive programmes and has unrivalled global reach through Nottingham’s campuses in the UK, China, and Malaysia. The School holds a Small Business Charter Award in recognition of its important role in supporting small and medium enterprises. It is accredited by both the Association of MBAs (AMBA) and the European Quality Improvement System (EQUIS) and ranks among the UK’s top ten for research power.