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Let’s face it: there is no such thing as a perfect company. Every business makes mistake at some point. However, a good preparation and planning can prevent mistakes from escalating into a crisis.

A crisis can disrupt normal business operations due to its unexpected nature. If preventive measures are not in place, a crisis has the potential to cause considerable negative effects on a company’s bottom line.

Mismanaged crisis can result in bad publicity, increased litigation costs and damaged name. Furthermore, it can mean lost sales from customers who will never go back. Needless to say, having a solid crisis management process in place is a critical part of any business strategy.

Let’s start by having a better understanding of what constitutes a crisis. It can be broken down into six stages.

 

The Six Stages of a Crisis

 

  1. Warning

The first part of a crisis begins with the Warning Phase. This stage can vary depending on the type of situation or different conditions that trigger a crisis.

Regardless of the length of time for the warning period, an effective communication plan must be in place. Adequate preparations must be made to disseminate critical information effectively to those who will be most affected by any possible untoward incidents that might occur.

This includes proper notification to specific concerned individuals or organizations such as law enforcement, key constituents, and other risk management personnel.

The manner of communication during this stage must be designed to heighten awareness, which means that simple, consistent, and direct language is recommended.

 

  1. Risk Assessment

This is the stage in which the crisis management team is tasked to assess risks, review potential consequences, and inspect damages caused by the crisis. Doing so allows them to decide what the next steps should be based on the extent of the damage. It also helps them determine what should be done to avoid a disaster or reduce its negative effects.

For best results, the risk assessment stage requires critical communication interaction, participatory decision making, and information exchange in the crisis management team and other outside resource personnel. An emergency response plan must be in place as well.

 

  1. Response

This is the phase where the spotlight is fixed on the organizations and individuals who appear to be involved in the crisis, whether they like it or not. Spectator’s attention will move from the incident itself to the personalities who appear to be at the center of the storm.

It’s important to have a spokesperson who is prepared and capable of responding to news and media appropriately. Their skills can make or break your brand reputation, so make sure that there is a clear communications plan that outlines what the proper response should be.

Moving quickly is the key to success since the first few hours are critical in building public trust and credibility. Be responsive to the media. See to it that key personnel are kept in the loop, especially shareholders, vendors, customers, and employees.

 

  1. Management

This phase requires you to be accountable and accept responsibility. Ideally, your organization must have a written crisis management plan that is readily available when a crisis arises. It should be published on the company’s intranet and in hard copy. It should contain essential information needed by the entire crisis management team, which includes the legal team, executives, management team, PR team, IT employees, board members, and other members who must be informed about the crisis.

If liability issues arise, don’t neglect how public opinion will be shaped as a result of an ongoing litigation. Accept responsibility, be transparent, and always be responsive to media to establish credibility and public trust.

 

  1. Resolution

The outcome of a crisis will depend on how well it was handled during the previous stages. Some might result in cases involving litigation, in which case the next course of action will depend on the judgment in the courts. Others might involve out of court resolutions for the aggrieved parties.

Regardless of the resolution, it is best to always be on top of the media scrutiny that might arise and have the right spokesperson to handle this situation. Always accept responsibility and be held accountable for any oversights.

 

  1. Recovery

This stage usually takes up a long period, so be prepared to be in recovery mode for the long haul. It can take months or even years to get back to “business as usual” both on the front end and the back end of daily operations.

Communication tasks during the recovery period is interdependent and should be expected to overlap with various individuals and target audiences. Be mindful of the differences when it comes to purpose, function, and characteristics of each group, and address these varying requirements as best you can.

 

Crisis Prevention Tips

Here are a few prevention tips you should keep in mind should a crisis occur:

  1. Do a vulnerability audit

This is a risk assessment process that will help you determine your organization’s areas of operational weakness or strength. This will be your basis for identifying potential solutions if a crisis occurs.

  1. Create a crisis plan

A plan of action must be in place that can be followed when a crisis occurs. Having a process or system in place must contain sections on the operational response, communications response, and how each team coordinates with one another.

  1. Provide crisis training

See to it that all employees are trained to handle a crisis. Keep their skills current by providing regular refresher training in crisis prevention and the appropriate responses expected from them based on their role in the organization.

  1. Respond immediately

Do not stonewall and follow the crisis communications plan as soon as possible.

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