Crisis management is the process by which an organization faces a situation that is potentially harmful to the company’s performance and reputation, through the use of certain practices that can thus prevent, manage and quell the disadvantageous outcomes of the crisis. Learn about our online cpi training mental health course at our online cpi training mental health course page.
Crisis management is therefore necessary to deal with problems and interruptions that occur in the various phases that make up any type of business, whether they are caused by events internal or external to the company, and which will give rise to a series of negative repercussions, such as damage productivity, image, and in extreme cases, failure.
In the corporate sphere, when is it possible to speak of a “crisis”? When business problems, embodied in this case by negative facts or events, become public: a leak generates a situation in which it becomes substantially impossible to control information and feedback on a particular brand, making it difficult the company monitoring and managing what is then said about it.
Those who do business will inevitably have to be ready to face similar situations, equipping themselves with tools and resources suitable to combat adverse contingencies, which have enormous potential in terms of damage to the company.
Corporate crisis management will aim to monitor and prevent potential threats, guiding the company through an informed, prompt and effective reaction.
There are three phases that make up the crisis management process:
- Research and monitoring: this is the first part of the process and concerns the analysis of the corporate environment, efforts are aimed at identifying any weak points that could affect the integrity of the business. Once the criticalities have been identified, a crisis management plan can be devised.
- Response and adaptation: the second phase will focus on the company’s reaction, we will adhere to the anti-crisis plan but it will also be important to adapt to any new critical issues not foreseen during crisis and monitoring.
- Recovery: in the last phase of the process, the goal will be to bring the company back to its pre-crisis state, trying to minimize any damage suffered.
The consequences that usually concern corporate crises are linked to a drop in sales, a poor marketing strategy and the ability of competitors to know how to win more customers.
An entrepreneur who will have the health of his business as a basic objective will have to dedicate time and resources to crisis management activities, putting his company in the best conditions in which to face the various crisis scenarios that could involve it.
What are the negative events that can most commonly cause a business crisis?
Let’s see them together:
- Natural events: Storms, earthquakes or epidemics are events that can damage infrastructure or endanger employees’ lives.
- Criminal actions: attempts at sabotage or criminal attacks can put the company in a bad light, which must be prepared to defend itself against accusations and lies.
- Human errors: inaccuracies, oversights, mistakes by employees and managers, which can undermine the general safety of the human element within the company, or reckless investments that will be unsustainable for the company, with very negative economic effects for the company. brand health.
- Technical failures: malfunctions of the structure that houses the brand, such as energy or IT failures, which will therefore negatively affect production.
- Lack of innovation: not knowing how to innovate and renew oneself could cause many problems, especially in the technological sectors, where the race for the most original product is always open.
- Bad communication: an ineffective marketing, or one that comes to touch controversial topics, in the first case could cause serious trouble for the company, placing it in the background compared to the market, while in the second it could trigger controversies (now inevitably on Social Media) that are difficult to manage .
- Conflicts: accidents at work, insecurity, relationship with trade unions. These are all elements that can undermine corporate serenity and the perception of it by customers, generating internal conflicts and external controversies.
Preventing corporate crises basically means trying to foresee every negative possibility that could, at any moment, hit the company, be it the strangest, most unthinkable and unimaginable of the eventualities.
Trying to list any weak point, present or potential, which may involve risks for the company will therefore be the goal of the crisis management strategy, training the subjects that make up the organization and allowing them to know how to intervene and react in the event of a corporate crisis : in this sense, the prior attribution of roles and tasks to be performed will be of fundamental importance, so that everyone knows what to do and how to do it.