may spark interest group opposition, or a corporate announcement may cause stock prices to tumble. All of these problems can be serious, but each development is foreseeable and therefore the plan to address it should be ready in advance.
"Crisis management," on the other hand, should be limited to surprises. Giorno explained that an organization should never let poor handling of the expected and anticipated (or that which should be expected and anticipated) force it into crisis-management mode. The objective of crisis management is to eliminate the potential harm and allow the organization to resume execution of its strategy. Giorno reminded the audience that many crises threaten to do harm to reputation. In fact, reputation is often the asset most at risk during a crisis. Sometimes businesses protect other assets in a manner that ends up worsening the damage to their corporate reputation. A good crisis management strategy aims to balance and protect all of a company's interests. To this end, Giorno shared with the audience a set of tips which he calls the 12 Rules of Crisis Management: Making the problem go away is different than remedying its consequences. Both must be tackled immediately. In responding to the immediate consequences, it's easy to lose sight of the need to fix the underlying problem. Consider assigning different people to these two different goals. Practise quick response, with the emphasis on quick. Corollary: Don't let the perfect become the enemy of the good. By definition, every moment lost to crisis management is valuable time when you could be advancing your agenda. Aim to have the crisis resolved within the minimum time possible – ideally, a single business day. Protect people before property. In a crisis, being perceived to put business interests ahead of the public interest risks damaging both. Gather a crisis management team that represents all relevant departments and whose members' time is dedicated to managing the crisis. Crisis management isn't something to be "fit in" among other duties. Identify in advance the outside professionals you will use during a crisis. Don't scramble to retain legal, accounting, environmental or technical expertise. Have your crisis management professionals designated in advance. Require organization-wide cooperation with the crisis management team. Everyone must understand that when the crisis team calls, it needs immediate results. Caveat: To the extent possible, those not responsible for crisis management should avoid distraction and carry on with their duties. The goal of crisis management is to minimize lost productivity and get the organization back to implementing its strategic plan. One reason for having a crisis management team is so that everyone else can stay focused on business. Establish a rapid, "one window" process for obtaining approval of the few decisions that your crisis management team cannot make on its own. A crisis allows no time for long, complicated decision- making processes. Also, if too many of the team's decisions require approval from another level, then you don't have the right people on the team.
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- Fall '15
- Business, Management, Corporation, Types of business entity