Crisis Management Always Causes a Management Crisis


Jim Lukaszewski

About four weeks into the tsunami disaster in Japan, The New York Times suddenly discovered that country's nuclear power plant and government officials were seriously underestimating the extent of the damages, casualties and scope of their disaster. Meanwhile, CNN—you know, the channel with that infernal yellow blinking "BREAKING NEWS" logo, which means they are about to say something for the 50th time that day—was using video that was 48 to 100 hours old (it should have read "BROKEN NEWS"). One alert said that Japanese authorities had seriously underestimated the scope, depth and potential of their nuclear crisis situation. Other media outlets picked up and reflected the refrain. The bloviators started grinding, pumping and carping. 

According to the Times reports—which became worldwide stories—Japanese authorities were reluctant to act at first for fear of damaging their expensive nuclear equipment and causing wider harm than had already occurred. In fact, this is how almost all corporate crisis responses begin. Anyone remember BP? Toyota? The banking crisis? The home loan crisis? The stock market collapse? The credit crunch? ENRON?

This happens in every crisis. Shouldn’t we all know by now that crisis management means that management is in crisis? Whenever there are victims, there is a pattern of leadership behavior that prevails, which includes:

Denial: Management denies the situation is as serious as outside sources (and some inside sources), especially the news media, tend to declare. “Let’s not overreact” is a frequent response.

Resistance: This is the claim that interference or intervention by outside sources and forces would simply complicate, stall and perhaps prevent a speedier resolution. All the while, the perpetrating company or organization takes only the smallest steps. Managers are fighting the cost of the crisis being assigned to their budgets, and worrying more about the condition of their equipment and assets than the damage being done and victims being created through the crisis itself.

Bewilderment: Behind closed doors, the executives are huddling, trying to figure out what exactly happened, who is responsible, how the blame may be shifted away from them, how to minimize what is said about the situation itself and how to maximize what is said about the company’s former good works.

Self-Deception: This is intentional minimizing, understating and withholding crucial information from the employees, the public and the victims, hoping that the situation can be remedied privately, easily and perhaps even heroically. 

Self-Talk: Usually takes the form of complaining about news media coverage, government interference, regulation and ill-informed or inexperienced oversight; and about people without credentials getting too much power and visibility.

Victim Confusion/Self-Forgiveness: There's talk about how much the company itself is suffering, that despite its wonderful history of corporate social responsibility it has now become a victim of overzealous politicians, activists, opportunistic reporters and unqualified people trying to extort compensation. No credit for all the past good deeds.

Management by Whining: BP’s former CEO Tony Hayward is the all-time champ with the phrase, “I need to get my life back.” The stress, tension, constant mistakes and outside pressure is very wearing on executives in charge of responding. Unfortunately, in today’s nanosecond deadline media environment, even a sincere expression of frustration and anguish can be interpreted just as Hayward’s was. It turned out to be a career-defining moment for him. 

This sequence of events or one closely resembling it is repeated in nearly every major and minor disaster and catastrophic situation. This is the pattern of management in crisis. The blunt reality is, however, that because all crises and their creation of victims happens so explosively, and the resolution of these extraordinary problems and challenges can only take place incrementally, the odds of any crisis being handled promptly and appropriately are relatively small, especially as the complexity of the situation grows. 

Eventually, as gaffes, bad decisions, willful delay and economic and asset protection decisions get exposed, events begin dragging management in the direction they should have been going from the start.

Those who manage crisis, those who communicate about crisis and those from management who will be paralyzed by crisis need to understand three powerful crisis realities: 

1. All crisis responses are mistake prone: They are riddled with errors and underestimate the intensity or seriousness of the situation. Lesson: It is always better to overstate the issues, understate the preparation and capacity and overreact from the very beginning.

2. Crisis management always causes management to be in a crisis: These situations should be discussed far more openly, and far more quickly, probably as they are occurring. Shortcomings, what isn’t known and what needs to be learned need to be exposed, disclosed and discussed continuously. Lesson: If the perpetrator fails to talk about their true situation, someone else almost certainly will. And those who talk will control the destiny of those who don’t.

3. Heads often roll in crisis situations: Those who lead, manage and talk are put under extraordinary strain and pressure by their own behavior, mistakes and attempts to minimize the situation. Lesson: Put someone who knows what to do in charge immediately. Give them a checkbook, an army and get out of their way.

It has to be noted, too, that in virtually every crisis situation—right along with the screaming headlines and the agitating journalists—far too many PR practitioners are right in there criticizing, pandering and puffing. From a management perspective, these PR comments are simply uninformed, staff-level jibber-jabber which fails to address the critical operating issues and questions that a crisis always creates. And they don’t help management get back on track faster.

Is it any wonder that management refuses to talk to its communicators, hides information from them and keeps them in the dark and away from the table? For communicators, the most important lesson of all is to say things that matter; do things that matter; be prepared to give useful information and advice on the spot; suggest operational actions that matter; and focus on helping management resolve their internal crises and anguish by recommending important constructive next-step operating options. 

Crisis communications and communications management expert Jim Lukaszewski is president of The Lukaszewski Group, a communications consultancy based in Minnesota. He can be reached at jel@e911.com




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