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December 30, 2019

John Daniels Explains Importance Of Having A Crisis Management Plan

A structured, well-conceived crisis management plan can be a company's saving grace when unforeseen issues arise. Poor publicity can escalate into a public relations fiasco, while threats, caused by weather or an unstable culprit, will severely endanger the well-being of innocent people if the right precautions are not taken.

The International Standards Organization (ISO) states that a crisis is 'a situation with a high level of uncertainty that disrupts the core activities or credibility of an organization, requiring urgent action'. According to a Pillsbury and Levick survey, which interviewed organizations from a variety of industries, the three most likely crisis events that affect businesses are data breaches, natural disasters and power outages.

A crisis can create devastating costs to a business, prolonging recovery times, casting a dark cloud over its reputation and piling up lost revenue.

Once a company ascertains all of the facts of the crisis and its potential impact, the management plan can be followed. Many of these blueprints provide a framework for a timely response to events, - including health and safety concerns, business disruptions or reputational harm - a hierarchy of teams to expedite an assessment and solution, and a communication strategy to minimize damage to the company. Other elements are the pre-emptive efforts towards a crisis, a categorization that ranks them from low to high risk and determining when and where they are most likely to occur.

A comprehensive crisis management plan should cover a wide range of incidents, as companies that fail to employ these guidelines are prone to experiencing much greater freefalls in the aftermath. One study from the Oxford Executive Research Centre proved that the publicly traded companies which executed their disaster recovery plans reduced initial negative capital repercussions by 60 percent, whereas those businesses that failed to enact their strategy went on to be hit by losses equivalent to 11 percent of their capitalization and an average stock price drop of nearly 15 percent.

John Daniels, a seasoned professional who served as the National Basketball Association's Security Director for 15 years, overseeing their crisis management programs, has determined a few reasons why such plans are vital to integrate.

Quick, Coordinated Responses

John Daniels notes that a crisis management plan will have staff better prepared and they will understand who is in charge of engaging in appropriate actions. Office evacuations might be required and, with a designated individual to spearhead that process, everyone can act effectively, exit the building in an orderly fashion and await the next steps in a safe location. Confusion is a common reaction during any crisis, usually exacerbating the ensuing chaos, but a crisis management plan can keep people relatively calm and collected.

Identify Resources

Your crisis management plan will allow you to recognize what resources you will need in an emergency or general setback. Clients and customers store their faith into your services, so you must incorporate a fine business acumen that has a secondary plan ready to put in motion if disaster strikes. They look to be assured of your capabilities to efficiently reply and recover from such unforeseen scenarios. An example might be a vendor suddenly becoming unable to supply you with necessary tools for your product, making it imperative that you have a secondary, trustworthy source to call upon.

Communication Planning

All crisis management plans implement sound, timely communications, addressing customers, the media, vendors, investors and staff. Panic and rumors can be prevented by this; in fact, acting swiftly is critical, because, if you go quiet, it will imply to the public that there is something to hide. Acknowledging the failure and apologizing is perceived to be a strength, since the company shows that it is accountable. Also, in dealing with phone calls from the press, you can prepare and practice your intended message in advance. It is important to be reasonably open with journalists, ensuring that they avoid speculating or sensationalizing in their articles.

Preserve Business Continuity

Having a steady crisis management plan will help your business prevail after a catastrophe was handled competently. Companies that falter can blame the lack of preparedness, ultimately giving customers incentive to forfeit confidence and allegiance. Technological disappointments and natural disasters are bound to happen; however, an extensive crisis management plan results in a stronger chance of restoration and future prosperity.


John Daniels closes his argument with some interesting statistics to regard, courtesy of Freshfields Bruckhaus Deringer: social media spreads stories within the country of origin in 50 percent of all cases and globally 30 percent of the time, possibly doing so in minutes; 28 percent of all crises reach international media within one hour; and 69 percent of all crises spread to an average of 11 countries in 24 hours or less. Quite literally, the world will be watching your next move when a crisis occurs. Do you want your company to be lauded as one that rose to the occasion expertly, or another infamous case of dropping the ball at the time of a crisis?

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