CRISIS MANAGEMENT

Crisis management is the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. Three elements are common to most definitions of crisis: (a) a threat to the organization (b) the element of surprise (c) a short decision time. Venette argues that "crisis is a process of transformation where the old system can no longer be maintained." Therefore the fourth defining quality is the need for change. If change is not needed, the event could more accurately be described as a failure or incident.

Introduction
Crisis management consists of: Methods used to respond to both the reality and perception of crises. Establishing metrics to define what scenarios constitute a crisis and should consequently trigger the necessary response mechanisms. Communication that occurs within the response phase of emergency management scenarios.

Crisis management methods of a business or an organization are called Crisis Management Plan.

CATEGORIES OF CRISIS: 1.SUDDEN CRISIS:

Robert B. Irvine, president of the Institute for Crisis Management, noted in Communication World that the Institute characterizes most business crises as one of two types: sudden crisis or smoldering crisis. "We define a sudden crisis as a disruption in the company's business that occurs without warning and is likely to generate new coverage," he said. Examples of such events include business-related accidents, natural disasters, sudden death or disability of a key person, or workplace violence.

2.SMOLDERING CRISIS:
Smoldering crises, meanwhile, are defined by the Institute as "any serious business problem that is not generally known within or without the company, which may generate negative news coverage if or when it goes 'public' and could result in more than U.S. $250,000 in fines, penalties, legal damage awards, unbudgeted expenses, and other costs." Examples of smoldering business crises include indications of significant regulatory action, government investigations, customer allegations, media investigations. "In some instances," Irvine added, "crisis situations may be either sudden or smoldering, depending on the amount of advance notice and the chain of events in the crisis."

Types of crisis
During the crisis management process, it is important to identify types of crises in that different crises necessitate the use of different crisis management strategies. Potential crises are enormous, but crises can be clustered. Lerbinger categorized seven types of crises Natural disaster Technological crises Confrontation Malevolence Organizational Misdeeds Workplace Violence
Rumors

Natural crises
Natural crises, typically natural disasters considered as 'acts of God,' are such environmental phenomena as earthquakes, volcanic
eruptions, tornadoes and hurricanes, floods, landslides, tsunamis,

storms,

and droughts that threaten life, property, and the environment itself.

Example: 2010 2011 flood of sindh, 2005 earthquake of NWFP.

Technological crises
Technological crises are caused by human application of science and technology. Technological accidents inevitably occur when technology becomes complex and coupled and something goes wrong in the system as a whole (Technological breakdowns). Some technological crises occur when human error causes disruptions (Human breakdowns).

Confrontation crises
Confrontation crises occur when discontented individuals and/or groups fight businesses, government, and various interest groups to win acceptance of their demands and expectations. The common type of confrontation crises is boycotts, and other types are picketing, sit-ins, ultimatums to those in authority, blockade or occupation of buildings, and resisting or disobeying police. Example: boycott of Nike & Pepsi.

Crises of malevolence

An organization faces a crisis of malevolence when opponents or miscreant individuals use criminal means or other extreme tactics for the purpose of expressing hostility or anger toward, or seeking gain from, a company, country, or economic system, perhaps with the aim of destabilizing or destroying it. Sample crises include product tampering, kidnapping, malicious rumors, terrorism, and espionage. Example: 2011 target killing of Karachi

Crises of organizational misdeeds

Crises occur when management takes actions it knows will harm or place stakeholders at risk for harm without adequate precautions. Lerbinger specified three different types of crises of organizational misdeeds: crises of skewed management values, crises of deception, and crises of management misconduct.

Crises of skewed management values

Crises of skewed management values are caused when managers favor shortterm economic gain and neglect broader social values and stakeholders other than investors. This state of lopsided values is rooted in the classical business creed that focuses on the interests of stockholders and tends to view the interests of its other stakeholders such as customers, employees, and the community.

Example: Sears sacrifices customer trust

Crises of deception
Crises of deception occur when management conceals or misrepresents information about itself and its products in its dealing with consumers and others. Example: Dow Cornings silicone-gel breast implant

Crises of management misconduct

Some crises are caused not only by skewed values and deception but deliberate amorality and illegality.

Workplace violence
Crises occur when an employee or former employee commits violence against other employees on organizational grounds.

Rumors
False information about an organization or its products creates crises hurting the organizations reputation. Sample is linking the organization to radical groups or stories that their products are contaminated.

Crisis Management Model

Successfully defusing a crisis requires an understanding of how to handle a crisis before they occur.

Assess risks and threats

Control Risks analysts facilitate risk assessment workshops, reviewing our clients' operations to identify the key threats that they might face. They conduct Business Impact Analysis to identify the organizations essential processes, people and systems. They will also assess the likelihood of threats occurring and their potential impact.

Develop strategies and systems

Having built up an understanding of the organization, our consultants can then start planning the structure, processes and people involved in the crisis management system. This will incorporate the various response and recovery plans that may exist or may need to be created.

Implement plans
Control Risks delivers training to help our clients' employees, customers and suppliers to practice their roles in the event of a crisis, and to help identify gaps in their crisis preparedness. We keep exercises and workshops interactive and engaging, allowing team members to rehearse in a pressured yet controlled environment. With more mature crisis management teams we run simulated incidents involving diverse geographical locations and levels of the organization.

Maintain plans
The best examples of crisis management capability are seen where organizations periodically review plans and train people. This allows plans to be modified to take account of changes (both external and internal) to the organisation. It allows the team as a whole to maintain familiarity with the systems in place and also to run through scenarios involving current threats. Where clients already have plans in place, our consultants can review and recommend improvements, based on extensive experience with clients across all industry sectors.

Manage a crisis

In the unfortunate event of a crisis, Control Risks can provide the expertise to help you minimize the impact, costs and potential reputation damage to your organization.

Characteristics of Successful Crisis Management:

crisis management strategy has become a flourishing industry. Unfortunately, it is a necessity of corporate reputation management and public safety. While some companies hire professionals to consult or even completely develop the crisis management policies and crisis communications methods effectively, others take on the task by themselves. Great Responsibility Comes With Crisis Management This is not a task for the faint-hearted as it comes with incredible responsibility. Depending upon the size of the organization and the type of industry involved the physical safety, emotional well-being, corporate reputation, and even environmental safety may rest upon a well-developed crisis management policy. What Characteristics Must Be Included? No matter who is responsible for developing and implementing the policies and procedures that must exist, there are certain characteristics that will be included in a successful crisis management plan. Some of those characteristics are: * Team creation - You must have a designated team of personnel that is in charge of handling. This should include expertise in executive, marketing/product management, operations, legal, human resources, information technology, finance, PR or media. * Command center - A command center should be established which will serve as the central location for all incoming and outgoing communications.

* Problem dissection - The team must break down the problem into manageable sectors and assign those sectors to appropriate team members. * Incoming communication - You must establish a call center if necessary to handle concerns and possibly information from employees and members of the pubic if necessary. * Outgoing communication - A single person should serve as the voice of the organization. This person must be properly informed and prepared before providing any necessary public updates. It may also be necessary to communicate directly with employees or their family members as well. * Resolution and control - Damage control must be handled promptly and effectively. This will not only be necessary for public safety, but also for corporate reputation management. A resolution when applicable should be employed. In addition, you must determine what steps can be established to prevent a similar situation in the future. When you employ the services of a professional crisis management team to develop and assist your company in implementing the necessary policies and procedures to prepare for a crisis these bases should all be addressed. However, if you determine to undertake this project on your own, you must make sure that your plan contains all of these characteristics.