Leadership In A Crisis – How Effective Would You And Your Team Be?

Stability is no longer the norm, if it ever was. Economic and physical crises dominate our newspaper headlines. Bushfires, floods, earthquakes and environmental disasters touch the lives of ordinary people every day.

The Global Financial Crisis sparked insolvencies, bankruptcies and liquidations and left no-one feeling safe. The CEO of BP slept well at night until April 20 this year when an oil spill thrust him into crisis management on an unprecedented scale.

Here in Australia, Cougar Energy, a quietly performing UCG company, hit the headlines in July with a $1.22 million share-raising. Within weeks it was reeling from two contaminated water table results that indicated carcinogenic traces. Two weeks later it was unable to survive the media storm; share trading was suspended and all staff made redundant.

Crises happen that quickly. How would you have coped?

Coping in a business crisis

Harvard Business School Professor John Kotter said in 2002: “In the next few decades, business environments are only going to get more volatile… Don’t wait for the building to be on fire before having an effective fire plan.”

It takes skill and training to work in the highly concentrated timeframe of an emergency, while maintaining a focus on managing and motivating a team.

Military leaders have initial training, and constant refreshers, on how to respond effectively in crisis.

When did you, or your team, last receive training on leading through a crisis?

Essential crisis planning tips

The essential elements to cover are planning, training and exercises so that senior managers have systems in place before a critical event occurs.

An effective leader in a crisis works decisively in a highly concentrated timeframe while maintaining a focus on managing and motivating a team.

Clear and concise communication is crucial, with involved parties and internal/external stakeholders.

Your planning phase needs to encompass all staff from the CEO through to the receptionist, who incidentally often bears the brunt of unrelenting journalists.

The leader will also need the ability to rapidly improvise his or her way through a situation, under intense stress.

This core skill of creativity was also recently identified by IBM’s 2010 CEO White Paper as being the most important quality in an effective leader.

You can’t always predict a crisis, but you can prepare to handle the response, pressure and stress. Doing so can reduce the potential physical and economic impact on your people and your business.

You need to react in a timely, flexible and decisive manner. Make a decision and you can always change it. Prevaricate too long and there will no longer be a choice.

You can’t force the outcome of a crisis but you can control the response. Crisis management in business often involves Acting in Time.

For businesses this could be the difference between insolvency and commercial success.

Lesson in Business Leadership: Act in Time and plan to manage a crisis

§  Identify the most likely categories of physical, environmental and economic crises, in conjunction with a risk management plan.

§  Plan, train and practice responses: if necessary engage a specialist consultant or seasoned interim executive

§  Regularly update your emergency or crisis response plans

§  Train yourself and your team to Act in Time

Sue Morgan was a former senior executive at Vantage Performance specialising in providing people solutions for businesses. Attracting, recruiting, motivating, training and managing the right people is the key to unlocking the potential of your business.


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