Home Corfu News Long Read: How Covid-19 Changed Crisis Management

Long Read: How Covid-19 Changed Crisis Management

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Some managers would prefer not to think about the possibility of a crisis. They prefer to try to convince themselves that “this will not happen to us”. But the Covid-19 pandemic has made it clear that a crisis can affect any organization, large or small, and that the impact can be devastating.

The word “crisis” has long been abused or trivialized: to dramatize the shortage of a popular consumer product; or to describe panic when the keynote speaker in your conference does not show up; or when an overly enthusiastic reviewer writes a damaging story that goes viral. The global pandemic has changed that.

With more than four million dead, hundreds of millions of people infected and tens of millions of people out of work, managers should have no illusions that a real organizational crisis is about life and death. and the survival of the business, and not just a temporary inconvenience or difficulty.

Organizations that had never experienced a crisis before suddenly lost much of their business; were forced to close; could no longer access vital markets or raw materials; or have had to lay off some or all of their staff. Unfortunately, many businesses will not survive the lockdown or reopen when the pandemic ends.

In the wake of Covid-19, every organization should now have a much clearer understanding of the potential devastation of an actual crisis. But this is not enough.

The reality is that while senior executives and leaders may be adept at running an organization, very few have built their careers on crisis management – and it is an experience most prefer to avoid. Yet a crisis or a major public problem can be one of the most difficult and important times in the life of a professional manager.

The tactical basics of crisis response are well known and not particularly difficult – setting up a crisis management team; development of a manual and protocols; identify and train spokespersons; and organize an occasional tabletop exercise.

The real test for managers is to make quick management decisions under the extreme pressure of a real crisis. By definition, a crisis is a low probability but high impact event that could seriously damage reputation or hamper the ability to do business. It is generally characterized by cause and effect ambiguity, superimposed by risk and uncertainty. More importantly, there is usually no obvious and easy solution, which in turn requires making the right decisions.

Crises highlight the importance of critical decisions, all of which could be subject to intense legal, regulatory or public scrutiny. With this in mind, it is quite natural – and it is good practice – for a manager to seek expert advice.

A communication crisis in a crisis

Two of the key elements of decision making in a crisis are: legal advice, to protect against the risk of lawsuits or litigation; and communication advice, to protect reputation and involve stakeholders.

It is well known that the greatest danger of a crisis lies less in what happened and in the perception of how the organization reacted well or badly. And such a response often requires the need to balance conflicting legal and communication advice.

At the simplest level, the disagreement can boil down to this:

  • The communicator says: “Say it all and say it now”
  • The lawyer said, “Let’s wait until we have all the facts; you can’t be in trouble for what you don’t say ”.

Senior managers then have to decide.

Communicators, by the nature of their profession, are generally free to give their opinion on what to say and why.

To better understand what lawyers think about their role in times of crisis, and to help me develop practical guidelines for executives caught in the middle, I conducted an original international survey. In partnership with the reputation management consultancy SenatorSHJ and its overseas network PROI, we interviewed experienced crisis management lawyers in England, Canada, the United States, Australia and New Zealand. . Full details are reported in a chapter of my new book Crisis Counsel: Navigating Legal and Communication Conflict (Rothstein Publishing, 2020).

When asked which areas are particularly prone to conflict, the lawyers interviewed offered apologies, as well as public statements and disclosures. (Litigation has been identified as another area prone to conflict.) Specifically, they believe that communicators’ tendency to communicate openly and transparently means they risk disclosing information that could lead to liability or future litigation. Lawyers were also concerned about the lack of legal awareness among communications professionals.

Another perceived area of ​​potential conflict was the balance between speed and precision. Almost all lawyers emphasized what they saw as the need for certainty before communicating, but communicators know that decisions in a crisis must be made quickly based on what is known at the time (which is usually incomplete).

Be calm in a storm

When lawyers were asked to name the primary force they bring to a crisis, the most common response was their ability to be calm and predictable, not their legal expertise.

At the same time, when asked to identify what communicators bring to a crisis, lawyers did not focus on tactical skills, although they widely recognized the ability of communicators to develop messages. succinct. Instead, they named the understanding of stakeholder communicators. As one lawyer commented, “They understand the imperfections of human nature better than lawyers. They understand the gladiatorial nature of the media better than lawyers. “

Despite these differences, a striking theme was the recognition that the two “parties” need to develop a better appreciation of each other’s roles.

Overall, the feeling was that a better understanding will lead to a greater mutual respect for what lawyers and communicators can each bring when a crisis arises. Several lawyers participating in the research stressed the importance of what they called a “hand in hand” approach. This was the key, they said, to getting the best overall result possible for the organization.

In just about every crisis, we don’t know what advice was or was not given. Whether good advice has been given and ignored, or bad advice has been accepted. Whether the executive took the advice of lawyers or communicators – or anyone at all. However, there are rare occasions when the tension between legal advice and communications becomes public, which can provide valuable information for other managers.

Case Study: Alton Towers

Take for example Nick Varney, CEO of Merlin Entertainment, owner of Alton Towers theme park in Staffordshire, England, where disaster struck in June 2015.

One of the cars on the 14-loop “Smiler” ride crashed into an empty stalled car, injuring 16 people, including two teenage girls who each required a leg amputation.

Committing to do the right thing while the facts were still unclear, Varney immediately attended the scene and took the lead in all communications as a spokesperson, unhesitatingly declaring the day when the company took full responsibility.

After the company was subsequently fined £ 5million for health and safety breaches, Varney said: ‘From the start the company accepted full responsibility for the terrible accident in ‘Alton Towers and offered a heartfelt apology to those injured. By accepting responsibility and accountability early on, we have tried to make the process of healing and compensation as easy as possible for everyone involved. In fact, Merlin even paid for the family injury lawyers.

You might wonder about the legal implications of such an early recognition of liability. But when it was all over, the company’s director of corporate affairs, James Crampton, told the BBC that they never underestimated the seriousness of the incident and chose not to have a lengthy consultation with them. lawyers and other advisers. “Our immediate response and subsequent actions were driven by a desire to do what we believed to be the right thing by everyone affected by the accident,” he said. “We didn’t try to hide behind lawyers.

Case study: Thomas Cook

Another high-profile example involved the tragic case of two young children on a Thomas Cook vacation dying of carbon monoxide poisoning at a cottage on the Greek island of Corfu. Gas was escaping from a faulty boiler that had not been properly repaired.

For nine long years, Thomas Cook maintained that even though the holidays were booked through them, the fault lay with the Corfu hotel and that the travel company “had nothing to apologize” for. This is the line pursued by the new CEO of the company, Peter Fankhauser, during the inquest into the deaths, in 2015. The coroner concluded that Thomas Cook had failed in his duty of care.

Soon after, Fankhauser met with the children’s parents and offered a sincere and sincere apology. He later admitted that he should have done so when he took over as managing director.

“I was faced with a situation that had lasted for nine years and dragged on and on,” he said. “Even though I was new to the job, I kind of got stuck in that legacy. I got caught up in this corporate behavior. I listened too much to the lawyers.

I don’t recommend for a minute that managers neglect what lawyers have to say in a crisis. This may very well increase the risk rather than reducing it, although sometimes it can be the right thing to do.

Review of crisis preparedness

Returning to the Covid-19 crisis, even as the pandemic rages on, responsible managers should review their preparedness for the crisis and consider whether they have done the right thing.

Organizations with an established crisis plan should thoroughly reassess its effectiveness in light of what has happened. How prepared were we for the crisis? Was our business continuity strategy nearly sufficient? How well have we protected our employees? Have we met the legal and communication needs? What do we need to update?

Meanwhile, organizations without a crisis plan have – hopefully – finally recognized that this is not an optional supplement to effective management. We know from research that after the attacks on New York’s World Trade Center on September 11, 2001, there was a marked increase in the number of organizations claiming to have a crisis plan in place. Sadly, we also know, from research only a year later, that that number started to drop as complacency returned.

Covid-19 has made real changes to crisis management, and managers need to ensure that the benefits of those changes are not wasted once the pandemic has passed. Now is the time to look ahead and prepare properly for the next crisis.