Managing a Crisis

During class Wednesday, Kenon Brown gave a presentation on organizational crisis management. He first discussed the recent BP Oil Spill, providing an example of lack of crisis management preparation. A crisis is a perception of an unpredictable event that threatens important expectancies of stakeholders and can seriously impact an organization’s performance and generate negative outcomes. Crisis management is vital to all organizations. Lack of preparation or an inappropriate response to crisis can negatively effect the reputation of the organization and can cause stakeholders to show negative criticism towards the organization. There are four steps to the ongoing process of crisis management: mitigation & prevention, preparedness, response, and recovery. When faced with a crisis, there are a number of practices an organization can use to guarantee the best outcome. The organization must first have a plan in response to given situations, and must then act on that plan. Strong partnerships with the public and media can help organizations receive positive criticism while dealing with the crisis. Meeting the public’s needs with honesty and openness can help build the organization’s credibility.
After discussing crisis management, its process, and the best practices when dealing with crisis management, Mr. Brown divided the class into groups for an activity. Each group was given a situation when organizations were forced to deal with crisis management. We were asked to determine what each organization should do in response to the crisis it was dealing with. Our group was given an example of a crisis that Regions Bank was faced with. The CAO of Regions was indicted on charges of fraud. Regions claimed they had no knowledge of this and that he acted alone. In response, our group chose to explain that it was an ongoing investigation and made no comments about the CAO at the time. After each group announced their statement or plan of action to deal with their particular crisis, we were given new information about the crisis, forcing each group to rethink their proposal. It turned out that the CAO of Regions was framed by a member of the SEC who was previously fired from Regions for stealing funds. Have you been a part of an organization that was forced to deal with a crisis management situation? If so, was the organization prepared for the situation? What did the organization do in response to the situation?

By: Drew Snider