Organizational Crisis Leadership | Crisis Management Structures

Organizations are responsible for creating an environment in which effective crisis leadership can operate. Poorly structured and disorganized groups will struggle to successfully manage a crisis, even with highly competent and experienced crisis managers in place. The following organizational principles support effective crisis leadership.

§  Clear responsibilities.: The company should establish clear responsibilities within the crisis management organization to avoid duplication of effort, or gaps and shortfalls within crisis leadership responses. Clear responsibilities can also remove some of the internal company politics when a crisis occurs.

§  Training and education.: Companies should set aside time and resources to ensure that key crisis leaders are educated and trained in how to best manage a crisis event, and how to best utilize the policies, systems, tools, and protocols within the BCM Plan.

§  Practice and rehearsals.: Crisis management groups should practice crisis responses, whether this is a practical exercise or table top discussion. Practice and rehearsal creates familiarity with the BCM Plan, develops confidence in the plan as well as with the crisis management team, and identifies any shortfalls or friction points.

§  Empowering leadership.: Crisis leaders should be empowered to take decisive action within sensibly established parameters. Training and practice will create corporate confidence in empowering crisis teams and thus allow some elements of control to be decentralized, enabling more effective management to brought to a crisis situation at the local level. Crisis managers without the ability to make decisions or take action will be significantly undermined in their ability to successfully manage a crisis.

o    Delegation. As part of the empowering approach, management should seek to delegate (sensibly) to the lowest levels crisis decision making abilities so that a structured and streamlined management system is emplace, rather than a centralized, unwieldy, and ponderous crisis management structure. This forms a core component to empowering leadership.

o    Authority lines. Clear authority lines, permissions, and authorities should be in place to enable swift and sanctioned decisions within the crisis management organization. Managers should know who to ask for permission, rather than try to attempt to identify decision makers during a crisis event.

§  Established systems and supporting mechanisms.: Companies should create effective systems and supporting mechanisms prior to a crisis occurring which will assist crisis leaders in logically guiding their decisions and supporting them in being efficient and effective in responding to an emergency. It will also ensure some degree of consistency in the response and provide confidence to managers that certain actions are automatically ongoing, and that defined information is being gathered and transmitted to predefined groups.

§  Innovation and flexibility.: Companies should understand that while crisis management systems and policies support crisis leadership, each crisis event will be unique and will require a tailored approach to achieving resolution. Innovation and flexibility are the cornerstones of effective crisis leadership—using established policies, plans, and protocols as tools, rather than crutches.

§  Leveraging.: Companies should always look both inward and outward to resources, knowledge, and capabilities which can be used to support effective crisis resolution. Those companies which do not leverage external resources will invariably miss opportunities to augment the effectiveness of their response.

Crisis Leadership | Crisis Management Structures

An organization's BCM Plan is only as effective as the knowledge and capability of those employees or managers implementing the risk evaluations, mitigations, and crisis response measures contained within the plan. An important aspect of the BCM Plan, as well its tactical response element (the Incident Management Plan), is the education, rehearsal, and testing of key decision makers and response managers. The BCM Plan does not work in isolation of human decision making and participation, and while the policies and plans will certainly support more effective management responses, offering structure, guidance, and systems to help guide an organization through the wide spectrum of challenges they may face—it will invariably be the effectiveness of crisis leadership which governs how well, or indeed badly, an organization will fare.

Crisis management leadership contains many of the same skills and tenants as would be found within any leadership role. The main differences between typical management and a crisis decision making is the speed that decisions need to be made and the gravity of impacts associated with the decision. When considering crisis leadership the following principles should be considered:

§  Knowledge.: Crisis leaders should have the knowledge and experience to effectively manage a crisis situation. Crisis leadership requires swift, balanced, and decisive action. Responses should not be impaired by a lack of understanding, confusion, self‐doubt (or indeed doubt in others), or the inability to formulate intuitive and innovative solutions based on a solid foundation of knowledge.

§  Information.: Decision making should be shaped by accurate and timely information. Decisions based on assumptions or speculation will invariably impede effective response measures and could exacerbate the problem. Understanding how to gather, process, understand, and utilize information quickly and effectively is a fundamental aspect of successful crisis leadership.

§  Confidence.: Crisis managers should have the confidence to take decisive action and to make informed judgments which are not undermined by self doubt or confusion. Confidence is based on the knowledge of how a crisis event unfolds and how to develop and implement structured, focused, and mature crisis solutions. Confidence also involves understanding your own, or organization's, limitations—and knowing when to seek support or guidance.

§  Practice.: Where possible (and appropriate) crisis leaders should seek to practice their management skills and associated responses to different forms of crisis events—whether it is a practical exercise or a management tabletop discussion. Practice will identify gaps and shortfalls as well as iron out any individual or group issues prior to an emergency occurring. Practice also develops knowledge, supports organizational structure, and creates confidence.

§  Structure.: Crisis leaders should develop a structured approach to their response to different forms of crisis events. Structure brings focus to what is often a confusing and dynamic leadership requirement. Structure also reduces confusion and doubt and engenders confidence within individuals and groups. Structure also reduces duplication of effort, identifies shortfalls and gaps in responses, and focuses multiple parties on meeting key issues.

§  Balance.: Crisis leaders should be decisive, but balanced in their approach to quickly formulating responses to often complex and challenging emergencies. The adage “less haste more speed” applies when considering rapid but balanced crisis management decision making.

§  Pace.: The pace of decision making should be measured and balanced, but reflective of the external drivers created by a crisis event—the speed of unfolding crisis events should be matched, or exceeded by the ability for managers to make effective decisions. Some crisis events will allow for a sedate pace of response, others will require immediate decision making and action. Crisis leaders need to understand the tempo of response requirements and align their leadership style accordingly.

Establishing the ability for individuals to make mature, confident, and well‐informed decisions will be pivotal for the success of the BCM Plan. The BCM Plan and its functional elements, such as the IMP and other crisis response plans (kidnap and ransom, evacuation, pandemic, and so on) are after all only a tool to support effective crisis leadership.

Response Buildups | Crisis Management Structures

Each crisis event will define what management resources are required to bring control to a situation. The entire crisis management organization may not be required on every occasion, and only those individuals or groups whose contributions and participation are required to effectively manage a crisis situation should be mobilized. Exhibit 1 illustrates a possible buildup of a crisis response organization following an event. At any stage the company may turn off the crisis response measures if the situation is resolved, or if it transpires that there is in fact no threat or crisis. Defining the difference between a problem and crisis is important in order to create the right expectations and perspectives, ensure that emergencies are correctly managed, and make certain that crisis and incident response organizations are not unduly fatigued. Typically, the response buildup starts from the bottom (e.g., the first responders identifying an issue and alerting their management chain, with information moving upward as more senior and experienced management are mobilized to respond to the threat). Preferably, if the company has a robust intelligence capability and risk mitigation system in place, threats will be identified prior to occurrence and the process can be driven from the top down, especially if the crisis is a strategic issue such as relating to public relations or financial and brand issues.

Exhibit 1: Response Buildup

Depending on the configurations adopted by the company when designing the crisis response organizational structure, as well as where the event strikes in terms of immediate hierarchy involvement, there may be a series of quickly escalating response levels flowing from the point of occurrence upward and outward to the most senior levels of the crisis response organization. If a crisis is brought under control and the impacts are neutralized, some elements of a crisis response organization might not be involved, or may be quickly stood down. Escalation of participation should be driven by the need to manage an event and offset its effects, rather than to generate immediate or unnecessary involvement of all participants within the plan.