Discover how a crisis management plan can help organizations with their business continuity strategies.
Crisis24 has been supporting clients in crisis for 30 years. From the start of the pandemic, we were embedded in several organizations’ crisis management teams and, later on, helped companies capitalize on their experience through “lessons learned” exercises, to help them prepare for a potential resurgence of the virus. This article contains key insights into the main challenges faced by global organizations while responding to the pandemic, and how learning from these challenges can help build future resilience.
From a pandemic comes an opportunity
Regardless of the industry, size or area of operation, all businesses were affected by the pandemic in one way or another. Companies around the world faced the challenge of first mitigating the initial impact, and then adapting to the “new normal” to safeguard their strategic objectives over the long term. The extreme conditions faced now provide a golden opportunity for organizations to assess their performance to improve their future resilience.
Preparing for the unexpected
Most global companies have crisis management capabilities. However, the scope and cohesiveness of those capabilities vary significantly, which is why different companies navigated the pandemic differently.
Prior to the days when coronavirus and social distancing became household words, a pandemic was rarely considered a key risk faced by organizations, and as such was given a relatively low level of attention in crisis planning. As some crises are, by their very nature, difficult to anticipate, organizations with an “all hazards” management plan were overall better prepared to face the COVID-19 crisis than organizations relying on scenario-based response procedures.
Some large multinational companies working as matrix organizations do not have a clear awareness of their footprint around the world. This led to business units and country operations being overlooked during the crisis. By building a comprehensive organizational map of all sites, offices, and any other presence around the world, organizational disconnect during any crisis can be drastically reduced. This has been highlighted as a missing element in many organizations’ previous crisis management strategies.
A readiness to make key decisions comes from proper support and training
Through conducting “lessons learned” exercises and speaking to many organizations’ crisis management team members, a common theme emerged: a vast majority reported feeling unprepared and lacking in confidence to make impactful decisions on behalf of their company. This is typically because most members are required to make decisions that lie beyond their day-to-day areas of responsibility. While most team members are appreciative of this opportunity, it is for the company to ensure that the added responsibility comes with the right level of support, from decision-making tools and guidance to crisis management training. Those who had received prior training felt particularly aided by having taken part in simulated incidents. Such exercises provide participants the opportunity to test processes and tools, increase confidence and allow teams to gain valuable crisis management experience in a controlled environment.
The importance of coordinating a single approach
When compared with a sudden event such as a terror attack, the spread of the COVID-19 pandemic over a relatively lengthy period provided something of an opportunity for businesses to anticipate the spread of the virus across different regions, and to prepare and adjust accordingly. However, some failed to engage with their own global networks sufficiently, and the extent to which their crisis management strategies were rolled out across all areas of operation was often inconsistent. This led to significant challenges in the face of the global crisis, as any unclear governance in a matrix organization will tend to be replicated within the crisis management organization. For example, in preparation of the easing of the lockdown, many companies issued centralized guidelines, yet often different approaches were adopted across business units within one country. As sites are often shared, in some cases, this even led to two conflicting sets of guidelines being issued within the same building.
This demonstrates the importance of having pre-established and cross-functional crisis teams in all areas of operation. These teams are further bolstered by centralized crisis management governance, which overrides the usual organizational hierarchy and delegation of power to business units. Business units need to understand that the typical level of independence and autonomy enjoyed may not always be acceptable in times of strategic crisis. For the crisis management organization to have the required level of authority and legitimacy, full endorsement should be provided by the group’s senior management team.
For many companies, the pandemic also exposed unclear authority structures within the crisis management organization itself, leading to an uncoordinated approach. In what was a first for most, entire crisis management organizations had to activate and coordinate at once. Without a clear description of roles and responsibilities for each activated group, this became chaotic at times. While some country-level crisis management teams took the lead in producing country-specific guidelines for their own operations, others either delegated this task to local teams or waited for centralized guidelines from headquarters. What is needed is a consistent approach across the organization that is clearly communicated to all activated groups to avoid duplication or omission of activities.
From crisis management to business continuity
The pandemic has forced many organizations to embrace remote working. Despite presenting an initial challenge for the IT function, this has been a positive shift for most overall, and has demonstrated the ability of organizations to adopt new ways of working. However, while office workers were able to work from home and maintain support functions, numerous manufacturing and retail activities were brought to a standstill.
This global crisis put the business continuity capabilities of most organizations to the test, and often revealed some shortcomings. Having not necessarily anticipated full country lockdowns, some organizations with manufacturing capabilities in a single country had to close their operations for weeks. An over-reliance on one freight method proved a challenge to some manufacturers, particularly as commercial freight-carrying airline traffic plunged. Any critical points of failure identified during the crisis—whether regarding areas of operation, usage of suppliers or freight shipping method—should be addressed. This can be done through restructuring supply chains to reduce dependence on a single country or supplier, diversifying activity when possible or establishing reliable contingencies.
In our experience, a typical response to a crisis will typically last a few weeks, while recovery can sometimes take months if not years. The virus has not gone away: companies and organizations need to learn from their experience and increase their level of preparedness for this, or for the next unexpected event.
