1. Crisis Management Chapter 12
Organizational and Managerial Communications
Crisis Management Chapter 12
Peggy Simcic Brønn

2. Definition
There are many definitions -- most agree that crises are characterized by surprise and a high threat to the operations of an organization.
Should they be a surprise?
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3. Medical analogy
Bed rest
Medication
Chronic
Fatal
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4. Types of Corporate Crises

5. Examples -- Norwegian Examples?
Public perception: Johnson & Johnson (Tylenol)
Sudden Market Shift: Atari (computer games)
Product Failure: A. H. Robins (Dalkin Shield)
Management Succession: United Technologies
Cash Crisis: Chrysler Corporation
Industrial Relations Crisis: International Harvester
Hostile Takeover: Bendix/Martin Marietta
International Events: General Motors/OPEC
Regulation/Deregulation: Braniff
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6. News Coverage of Crises Increasing
Business crisis events are increasing
Sexual harassment -- increased 192% -- fastest growing category
Class action suits, particularly against tobacco industry -- up 83%
Automotive industry -- most crisis prone industry -- Banking #2
Commercial airlines close behind
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7. Crisis Management Problem-sensing and diagnosis Decision response
Resource mobilization and implementation
Internal information flow
External information flow
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8. Proactive and Reactive Sides of Crisis Management
Pauchant & Mitroff
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9. Strategic Checklist Strategic actions Technical and structural actions
Evaluation and diagnostic actions
Communication actions
Psychological and cultural actions
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10. Crisis Management Group
Leader
Press spokesperson
Employees/next of kin
Authority liaison
Technical and legal advisors
Secretary
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11. Common Reactions to Crises
Denial or isolation
Anger
Bargaining for time
Depression and grief
Acceptance
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12. Crisis Communication It is spontaneous.
It is dependent on the size and nature of crisis.
It is a ‘happening’.
It needs other demands from management than ‘normal’ routines.
It will normally affect many different stakeholders than planned communications.
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13. When an accident, crisis or catastrophe happens, it is too late to develop a crisis information plan.
A media plan and mental readiness must be in place before an accident, not developed during the accident.
E. R. Sjøberg
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14. Two Key Words Two Strategies Speed Confidence
Information -- one-way spreading of facts and information
Communications -- two-way method of giving out information
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15. Effective communications may:
Reduce risk of problem becoming greater
Limit interference with normal operations
Limit damage to corporate reputation
Limit financial damage
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16. Reality Many firms are not prepared for crises
Many hire PR firms to ‘put out fires’
Very little proactive planning done
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17. What affects reaction by others:
Organizational behavior
Conduct of management
Research indicates that behavior of management key in recovery of firms
Reaction of stakeholders
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18. Be open, flexible and willing to accept responsibility
Don’t claim to be perfect
Initiate dialogue will all stakeholder groups
Provide accurate, timely information to all targeted internal and external audiences
Demonstrate concern for safety of lives
Safeguard organizational facilities and assets
Maintain a positive image of the organization as a good corporate or community citizen
Peggy Simcic Brønn