Every company, regardless of their size or the industry they’re in, can be hit by a crisis. And, whether internal or external, any crisis has the potential to undermine public confidence and employee morale in your company. How a company manages a crisis – and how well a company weathers a crisis – is often a reflection of the quality of leadership in that company.
History is littered with examples of poorly-handled corporate crises. In spite of that, companies often fail to learn from the mistakes of their peers. Leading through a crisis is very different from leading through the norm of everyday operations. So how should leaders prepare to do their best when facing the worst?
The first place to start is with a robust communications plan. Companies are often operationally prepared for contingencies, but many times lack the proper planning to handle a crisis related to public relations or legal issues. These more metaphorical types of crises can plunge even top-level performers into a chaos of situations they are unprepared and unequipped to handle. The result, far too often, is a leader who makes disastrous decisions in the heat of the moment.
Managing through chaos
The normal organizational models that characterize a smooth-running organization tend to disappear during a time of crisis. But the resulting chaos can be effectively managed if leaders understand its impact.
Here are nine tips for leaders charged with leading their organizations through a crisis:
Tip #1: Stay calm.
The quickest way to lose respect for, and trust in, your leadership credentials is to lose your balance in a crisis. A competent leader calmly addresses the crisis, gathers information, assesses the damage, and develops a solution. An inept leader will lose control of his or her temper and emotions, act impulsively and/or in anger, and resist complete awareness of the situation.
Tip #2: Face reality.
When it comes to leading through a crisis, reality begins with the leader. Faced with any crisis, leaders should first take a good, long, honest look in the mirror and recognize any role they may have in creating the problem that now faces them. You can’t solve a problem – you can’t begin to craft an effective plan to solve the problem – if you don’t acknowledge its existence. A short-term “solution” only ensures a repeat of the crisis in the future.
Tip #3: Gather your team early.
In a crisis, it is critical that everyone in your executive team shares the same goal. They may have different reasons for wanting to reach that goal, but it is vital that all departments have a goal and a mission in common. In most crisis situations, the goal is a swift return to normalcy. To a Chief Financial Officer, this may mean stopping revenue loss, while to a Human Resource Director it may mean maintaining a calm, confident workforce.
Whatever your goal, getting your team together and aligned in their expectations early in the process will help your company present a calm, unified front. This is important because…
Tip #4: No matter how bad things are, they can get worse.
When the first wave of bad news hits, many leaders assume the worst has happened. A common response to bad news is to counter that news with assurances that things aren’t that bad or that the problem can be solved easily.
That may be fine for small glitches in your company’s operations, but if you’re faced with a really substantial problem, your corrective action must be strong enough to immediately begin to correct the downward spiral.
Although it may be painful to be honest about the root causes of the problem (refer to Tip #1), it is far better for leaders to face the worst and restructure their organization for a healthier future.
Tip #5: Communicate clearly and consistently to all stakeholders.
In the ordinary course of business, leaders are concerned about things like revenue growth and earnings per share. In a crisis, communication is king.
Poor communication – or worse, inconsistent and confusing communications – will affect your company’s image, its sales and its balance sheet. So make sure before any communication goes public, that the key members of your crisis team are fully and completely briefed on what is about to be said.
Tip #6: Delegate.
In a crisis, many leaders isolate themselves, believing they must solve the problem on their own. In reality, the best leaders rely on the expertise and experience of their trusted senior executive staff, and will solicit them for ideas.
A wise leader understands that, while they provide direction and focus during a crisis, they cannot do everything themselves. They will need the help of their best people to devise solutions and to implement them. This means developing a key team of people in whom they can confide, asking them for help and ideas, and gaining their commitment to implement corrective actions that may be painful, but necessary.
Tip #7: Lead by example.
During a crisis, everybody’s eyes are on the leader. Will they fold under the pressure? Will they stay true to their values? If there are sacrifices to be made (and there are almost always sacrifices to be made), will the leader let others take the hit while they protect themselves from discomfort? Will they try to cover up the truth, or confront the crisis head on?
How a leader responds in a crisis sets the tone and the example for every employee in the company, from the executive suite to the lowliest intern.
Tip #8: Look for the opportunities.
It is human nature for people to be comfortable doing things the way they’re used to doing them and to resist change or make only small changes. During a crisis, the resultant shifts provide a company with an opportunity to reevaluate areas of its operations and provides a sense of urgency to make changes.
Tip #9: Anticipate the next crisis.
Today, our world seems to routinely be in crisis mode; we seem to hear about a new disaster every week. The nature of crisis thrusts leaders into tension, uncertainty, and stress that puts them under enormous mental and emotional strain. Events often happen quickly, allowing little time for thoughtful, measured consideration. The right personnel may not be available at the right time. Under these circumstances even a seemingly insignificant decision can have far-reaching impacts.
The solution is to develop a contingency plan before your company faces its next crisis (or its first crisis, if it’s been lucky so far). Develop the foundation and guidelines for responding to any crisis and make sure your organization has the personnel and tools to carry out the plan.
Although every leader has his or her own style, it is critical for a leader to always be aware and prepared for a variety of challenges. Even though one leadership style does not fit all types of crisis situations, with a contingency plan, your organization will have the foundation to effectively respond and recover from a crisis.