A crisis can strike any organization at any time, often with little or no warning. Being prepared with a detailed crisis management plan can help organizations effectively respond to and recover from a crisis. Here are some key reasons why every organization, regardless of size or industry, needs to have a crisis management plan for organizations in place before disaster strikes.
why a crisis management plan for organizations is necessary:
1. The Potential for Crisis is Ever-Present
Crises can take countless forms, from cyber attacks to product recalls to natural disasters. Even if an organization has avoided major crises in the past, the potential is always there. Markets, political environments, regulations, competitors, and technology continually evolve. New risks emerge while old ones may reappear in different guises. Being proactive with crisis preparation helps organizations identify risks and address vulnerabilities ahead of time.
2. Crises Cause Costly Business Disruptions
When a crisis hits, it inevitably causes disruption to normal business operations. Employees are unable to get to work, facilities are damaged, supply chains are interrupted, and demand for products and services shifts abruptly. The financial costs quickly add up from lost sales, supply chain interruptions, infrastructure repairs, legal liabilities, and more. Advanced planning minimizes business disruptions and helps companies bounce back more quickly.
3. Crises Can Damage Reputations and Erode Trust
An organization’s reputation and the trust of key stakeholders are invaluable assets that have accumulated over the years. However, trust can quickly erode when an organization appears unprepared, disorganized, or unconcerned during a crisis. Once trust is lost, it can take years to rebuild. A detailed crisis plan conveys preparation, control, and concern for stakeholders’ interests.
4. Crisis Planning Allows for Agility and Adaptability
No organization can predict exactly when or how a crisis will occur. What is certain is that the landscape will look very different during and after a major crisis. A crisis plan that includes effective crisis communication to employees and stakeholders enables organizations to think through scenarios, get input from across the enterprise, identify critical vulnerabilities, and establish protocols. This agility and adaptability will prove invaluable when a crisis hits and the normal rules no longer apply.
5. Crisis Planning Reduces Liabilities and Protects Assets
During a lawsuit or government investigation, crisis preparation is examined closely. Lack of preparation is viewed as negligence, and organizations that are seen as negligent often face heavier penalties and settlements. However, demonstrating due diligence through crisis planning strengthens an organization’s legal position. A crisis plan protects critical assets like facilities, data, supply chains, intellectual property, and human capital.
6. Crisis Planning Provides Direction and Minimizes Confusion
In the midst of a crisis without a plan, confusion reigns, and critical errors are made easily. A crisis management plan for organizations gives everyone clear guidance on responsibilities and next steps. Well-defined protocols minimize miscommunications and allow the organization to provide timely, accurate messaging to employees, media, and stakeholders.
The Time to Plan is Now
With so much at stake, organizations should not delay creating a crisis management plan. An ongoing process of planning, evaluation, and revision is optimal for keeping the plan up to date and preparing personnel. Crises are inevitable, but organizations and reputations can emerge intact with proper planning. There is simply no excuse for being caught off guard when a crisis strikes. Every organization owes it to its employees and stakeholders to have a crisis management plan for organizations in place before disaster strikes.
Also read: 5 Key Principles for Effective Crisis Communication
