Crisis Management (CM)

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Crisis Management - Page 2 of 2

Anticipating potential crisis situations that a company may encounter and formulating and documenting contingency action plans for them are a basic requirement of any crisis management program. These plans should also be well-rehearsed by all employees, so the conduct of regular drills is also needed. Any company must be prepared to deal with fires, bomb threats, personnel violence, and natural disasters such as earthquakes and tornadoes. In the semiconductor industry, the discovery of a life-threatening device reliability issue, process gas leaks, hazardous chemical spills, and even the sudden loss of a major supplier are examples of crisis situations.

One of the hardest things to contend with during a crisis is the craving of customers or the public for a constant supply of information. Accurate information pertaining to a crisis are often not readily available at once, and are too bitter to announce to the public once they become available. If the crisis does not concern the public, then a company may get away with staying quiet about it.

Otherwise, the press will usually be all over the place within hours. In such a case, there is no choice - most experts agree that it is better to provide accurate information, no matter how painful they sound, than to manipulate the situation by giving false information to the public, which often backfires with tremendous repercussions. Thus, a company that has developed a culture of internal secrecy and manipulation is of great disadvantage in this respect, because they would find it difficult to provide honest information and subsequently resort to the thing they usually do: hide the truth. PR work for high-profile crises is something that any management team must be well-trained for.

Being indecisive, playing time, or inability to get accurate information quickly can be disastrous during a crisis. Management must act swiftly and decisively to contain the problem, assess affected goods, ensure business continuity, allay public fears, and preserve company reputation even while the crisis is still unfolding. Since a crisis by definition is unpredictable, a company needs to have a system for assembling a crisis management team that knows what to do within an hour after a crisis occurs, 24 hours day, all year long.

The visibility of top management people during a crisis is highly recommended by experts because it assures the public that the problem is getting due corporate attention. Management must also actively pursue long-term corrective and preventive actions to avoid being in the same crisis situation again.

A comprehensive crisis management program includes the following components: 1) an emergency response, which consists of all activities pertaining to safe management of immediate physical, health, and environmental effects of the crisis; 2) business continuity, or the company's ability to continue delivering goods and services despite the crisis; 3) crisis communications, which pertains to the internal and external PR management activities during a crisis; 4) humanitarian assistance, or the company's efforts to alleviate the physical, emotional, and psychological effects of the crisis on other people; and 5) drills and exercises that allow personnel to rehearse what they need to do in a crisis situation.

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