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Effective crisis response must be a corporate imperative

Effective crisis response must be a corporate imperative

Lucy O’Brien explains why a business is only as strong as its response to a crisis

One does not need to look further than today’s headlines to know that corporations these days are being swamped by a deluge of crises for myriad reasons. It is now evident that effective crisis management is more critical to long-term corporate survival than ever before and that an organisation is only as strong as its response strategy.

There is also the fact that enterprises across the globe are ambivalent with regards to the outlook for 2018, expecting it to be a year of economic uncertainty, geopolitical turmoil and slow growth. The fall in oil prices is giving rise to a new climate where business in all areas is seeing challenges, compounded by slowing economic activity in China and other emerging markets.

The biggest challenge is the emergence of short-termism when it comes to business planning, as the drive to trim costs makes it difficult for managers to focus on strategic vision. There is a temptation to focus solely on getting through the next few months, with hardly a forethought given to long-term prospects.

Long-term customer loyalty and respect, while intangible, are critical to a company’s long-term outlook. These are assets that can be instantly compromised in the event of a crisis, worsened further if an effective and timely response apparatus is not in place.

Time is not a luxury you can afford during a crisis. You need to plan for the worst and have any potential risks identified and evaluated ahead of time. Companies need the right social media listening tools, a shortened chain of command and a multi-platform newsroom to respond to a crisis, harnessing the power of social media to reach stakeholders directly, while also utilising traditional media.

We see examples of companies failing in the new age of crisis management on a recurring basis. The more prepared a company is, the better it can manage the situation. Companies with long chains of command will never get ahead of the curve and frontline staff need to be empowered to deal with the situation at hand.

Leadership is another critical component. The truth is that more often than not board executives usually focus on simply managing a crisis according to check-boxes on a list, rather than leading from the front at a time of a significant reputational challenge. The secret to reputation recovery after a crisis involves leaders taking rapid action and then communicating to key stakeholders in an authentic way.

A stellar example is Tony Fernandes, group CEO of AirAsia, when one of the carrier’s planes flying from Indonesia – AirAsia Flight 8501 – crashed in December 2014 resulting in the tragic loss of all 162 passengers on board. Not only did Fernandes communicate early and constantly on behalf of the company through regular tweets, but he also showed the kind of genuine compassion that marks a true leader in fatal crises.

Fernandes’ tweets were not crafted by lawyers or corporate PR representatives. He expressed anguish for the families of the passengers, the staff and even himself. He arrived at Surabaya – from where the flight departed – almost instantly, meeting with families and staff and making himself constantly available to the media, even when he had nothing new to share.

His response is illustrative of the fact that one of the most vital roles for any CEO is to ensure that their organisation is fully prepared to successfully deal with crises. In today’s environment, where news travels at unprecedented speed and can instantaneously usurp your control, planning ahead of time is a critical investment in reputation management. When a crisis hits, the market is quick to jump to conclusions. Public perceptions start forming with the first tweet, making a company’s response in the first 24 hours absolutely critical.

Whether a company has the right plan and people in place, and is able to show authentic leadership, or is simply geared towards checking boxes off a list, are important questions it needs to confront before it is too late.

Crisis management must be seen as an opportunity. It could be an opportunity to go out of business, or it could be an opportunity for the company in question to truly live up to its mission and values.

Lucy O’Brien, general manager and partner of FleishmanHillard UAE

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