Crisis Management BCHR 326 PDF

Crisis Management BCHR 326  CHAPTER: 4 The Crisis Prevention Process Crisis Prevention Process Crisis prevention is proactive crisis management. The goal of crisis prevention is to avoid a crisis. Another term for prevention is mitigation. The term prevention is used to capture both...

Crisis Management BCHR 326  CHAPTER: 4 The Crisis Prevention Process Crisis Prevention Process Crisis prevention is proactive crisis management. The goal of crisis prevention is to avoid a crisis. Another term for prevention is mitigation. The term prevention is used to capture both stopping something from happening and hindering something from happening. Crisis Prevention Process Crisis prevention is proactive crisis management. The goal of crisis prevention is to avoid a crisis. Another term for prevention is mitigation. The term prevention is used to capture both stopping something from happening and hindering something from happening. The crisis prevention process is a combination of signal detection and correction. Signal detection attempts to find crisis warning signs, correction is designed to reduce or eliminate the threat.  Comprehensive crisis prevention program Comprehensive crisis prevention program include Five-step crisis prevention process Signal detection (1) identify the sources to scan, (2) collect the information, (3) analyze the information, Correction elements (4) take preventative action if warranted (5) evaluate the effectiveness of the threat reduction.  IDENTIFY THE SOURCES TO SCAN - Sources used in issues management, risk management, and reputation management can be combined to provide a comprehensive set of sources that crisis managers should scan. - Environmental scanning is a tool that is popular in issues management IDENTIFY THE SOURCES TO SCAN Basically, environmental scanning means watching the environment for changes, trends, events, and emerging social, political, or health issues. The information is used to guide organizational decision making to plot future actions IDENTIFY THE SOURCES TO SCAN Environmental scanning strategies used by organizations are not well developed. Still, crisis managers must consider the sources involved in external scanning that would be helpful in locating warning signs.  IDENTIFY THE SOURCES TO SCAN Red flag is a common term for a sign of danger that has been used in previous crisis management writings. Red flags would aid the crisis prevention process by specifying what to look for, where to look for it (source), and what it means (analysis). Crisis managers should develop and update accordingly their list of red flags.  IDENTIFY THE SOURCES TO SCAN - External scanning uses both traditional print and online sources. - Most traditional sources can now be found online as well. - A common method used to monitor the environment is to watch, listen to, or read both traditional and online news sources -  IDENTIFY THE SOURCES TO SCAN - The news media include leading or elite newspapers (e.g., New York Times, Wall Street Journal, Washington Post), news and business magazines (e.g., Time, Newsweek, Fortune), and television news programs, such as the evening news and TV news magazines (e.g., 60 Minutes, 20/20). Of special interest is information about crises in similar organizations. Case studies of similar organizations in crisis are a valuable resource for crisis managers, allowing crisis teams to learn from someone else’s crisis rather than their own.  IDENTIFY THE SOURCES TO SCAN Individuals are another source of environmental information. Crisis managers should focus on two broad categories: public opinion experts and the organization’s own stakeholders. Public opinion experts, like the published data, provide insights into public attitudes, lifestyles, and values. Stakeholders can tell the organization how they feel about issues and organizational actions  IDENTIFY THE SOURCES TO SCAN Information spreads on the Internet by ways other than in the conventional media or publication sources. Discussion groups, message boards and forums, web pages, dedicated complaint sites, blogs, microblogs, content- sharing sites, aggregators, and social bookmarking and social networking sites are information sources that should not be overlooked.  IDENTIFY THE SOURCES TO SCAN Social media is easy to use and is simply the ability to post content (e.g., messages, videos, images) to the Internet that other people can access. Social media includes a variety of Internet-based applications (channels) that allow user to easily create and post content to the Internet. Another term used to capture user- created content is stakeholder media.  IDENTIFY THE SOURCES TO SCAN Organizations may choose to develop their own social media monitoring system using software such as Unilyzer, Google Alerts, or Trendspottr. The Internet serves as a dual information source: It can be used to access information also found in print or broadcast form, and it can be used to collect information unique to social media.  IDENTIFY THE SOURCES TO SCAN Whether using a social media monitoring service or developing their own social media, monitoring center, crisis managers need to know the term dashboard. dashboard is defined as “a technique for simplifying data reporting by displaying a small number of important summary measures together in one location” A dashboard can be a visual representation of the data generated by the analysis of social media messages. crisis managers can see all the critical information they need on a properly designed dashboard.  IDENTIFY THE SOURCES TO SCAN Risk management examines sources that have more of an internal focus. Traditional insurance coverage indicates risks worth insuring against. Insurance risks include liability exposure, criminal exposure, and worker compensation exposure. All three areas can produce lawsuits and extremely negative publicity. Natural disaster exposure identifies what Mother Nature might do to the organization. An organization’s managers must know if facilities are at risk of crises caused by floods, earthquakes, or volcanoes— natural actions typically not covered by insurance.  IDENTIFY THE SOURCES TO SCAN Safety, maintenance, and accident records reveal minor problems that could become crises. These records should be examined for patterns. Organizations have what are called near misses—something bad that almost happened. A series of near misses runs the risk of escalating into a major crisis.  IDENTIFY THE SOURCES TO SCAN Employee use of the Internet and e-mail also are sources of risk. Misuse of these online communication tools can result in information leaks, computer viruses or worms, discrimination and harassment lawsuits, or reduced bandwidth capacity. Concerns over online risks have led most companies to create Internet and e-mail use policies and to use software designed to monitor employee online behavior. Table 1 Shows otential Crisis Sources to Monitor  COLLECT THE INFORMATION - Once potential environmental information sources are located, crisis managers face the challenge of gathering the information. - Content analysis, interviews, surveys, focus groups, and informal contacts are among the most frequently used collection tools. Familiarity with these tools is an important crisis management asset. - Content analysis converts the written information into quantifiable data— the words become numbers that can be analyzed using statistics. Some examples may help to clarify the content analysis process.  COLLECT THE INFORMATION -When utilizing any print, online, or broadcast source, content analysis can be useful. It involves the systematic coding and classification of written materials, be they news stories, articles in other publications, or transcripts of focus groups or interviews. -Effective content analysis requires the development of coding categories and expertise in using the categories. -Systematic coding allows for comparisons that could not be made if the written information had not been quantified. It is the recording and quantifying of the material that qualifies content analysis as a form of information collecting.  COLLECT THE INFORMATION - Most organizations have established categories for accidents and safety violations. People are trained to understand the differences in the accident and safety categories so that they can accurately record these events - Organizations should develop categories for coding customer complaints. It is not enough to know the sheer number of complaints received; organizations should know the type and frequency of different varieties of complaints. By categorizing customer complaints, organizations can identify problem areas by the increase of complaints in those areas.  COLLECT THE INFORMATION - The first step in soliciting information from stakeholders is for the crisis team to construct a stakeholder map that lists all possible stakeholders Then the crisis team would identify the stakeholders relevant to the most - highly ranked crises. -To collect information from stakeholders, use interviews, surveys, focus - groups, or key contacts can be used.  COLLECT THE INFORMATION Interviews Interviewers ask people questions about a particular subject in an organized fashion. The interviewers develop and follow an interview schedule. Preparation is essential. The person collecting the information must have an organized approach to the interview if it is to yield useful information Surveys Collect information about people’s perceptions, attitudes, and opinions. Surveys can be conducted by having people complete questionnaires or by having researchers ask stakeholders the questions.  COLLECT THE INFORMATION Focus groups Collections of specific stakeholders who are brought together to listen to and respond to questions as a group. Open-ended questions are used to encourage interaction and to probe the nature of people’s beliefs. Key contacts They are community, industry, or organization leaders who are selected because of their expertise on a subject. Using public opinion or issue experts is a form of key contact  ANALYZE THE INFORMATION - Analyzing information creates knowledge. Crisis managers determine whether the information really does suggest a possible crisis. - Analysis is the process of understanding if and how a warning sign might impact the organization. - Crisis managers need criteria for evaluating issues, risks, and reputation threats  ANALYZE THE INFORMATION - We can build threat assessment analysis around two factors: likelihood and impact. - Likelihood is the probability that a threat will become a crisis. Impact is the effect the crisis can have on stakeholders and the organization. Typically, each threat is given a score from 1 to 10 for likelihood and threat, with 1 being low and 10 high. When crisis managers analyze the issue, risk, and reputation threats in terms of likelihood and impact, they can determine whether each threat warrants further attention and/or action. Likelihood and impact have slightly different meanings for the issues, risk, and reputation  ANALYZE THE INFORMATION For issues, likelihood is the probability of an issue gaining momentum. An issue with momentum - is developing and is more likely to affect the organization. Some indicators of momentum are sophisticated promotion of the issue, heavy mass media coverage, strong Internet presence, and a strong self-interest link between an issue and stakeholders. - Impact refers to how strongly the issue can affect profits, reputations, or operations. It involves the use of forecasting, which projects the potential effect of an issue on the organization. There are at least 150 forecasting techniques used in business.  ANALYZE THE INFORMATION For risks, - likelihood is the probability that the risk can or will become an event—the risk will cause something to happen. This estimates the possibility of the risk being exploited or maturing into an event. - Impact is, again, how much the event might impact the organization and its stakeholders. In this context, it includes disruption to organizational routines and potential damage to people, facilities, processes, or reputation  ANALYZE THE INFORMATION For reputation, the evaluation of likelihood and impact is not as clearly developed and a little more complex. Before evaluating likelihood and impact, crisis managers must determine if an expectation gap exists. Figure 1.1 Expectation Gaps  TAKE PREVENTIVE ACTION -Crisis managers must determine what actions to take on the serious threats. Monitoring involves following the development of the warning signs. - The crisis team continuously collects and analyzes information about the warning - signs, looking for changes that indicate whether the risk is becoming more or less likely to evolve into a crisis.  TAKE PREVENTIVE ACTION -- The information sources, collection tools, and analytic criteria used in scanning are employed in monitoring. The key differences are a search for more detailed information and the continuous application of the search process in monitoring. -If a threat is serious enough, action is taken to diffuse it. Actions create changes that eliminate or reduce the likelihood of a warning sign becoming a crisis. Actions are taken to manage issues, to reduce risks, and to build or maintain reputations.  EVALUATE THE EFFECTIVENESS OF THE THREAT REDUCTION Evaluation consists of comparing the actual resolution of the issue to the intended or desired one. Success is measured by how closely the actual resolution matches the desired one. Evaluation does not end with the issue’s resolution. Issues are cyclical, and they have the potential to reappear.  PARACRISIS Crisis prevention raises the idea of paracrises, which occur when crisis managers must publicly manage a crisis threat. The effort to manage the crisis threat frequently mimics a crisis response. Paracrises are likely to occur for rumors, challenges, and product harm. These three are most likely to have stakeholders publicly question an organization’s ability and warrant a public response to the crisis threat.  CONCLUSION - A crisis prevention program is a valuable part of the crisis management process. The crisis team uses the warning signs from signal detection to target situations that could become crises. - The team then takes actions designed to eliminate or reduce the likelihood of the warning signs developing into crises. - prevention is not as easy as it sounds.  CONCLUSION - Finding potential crises is a type of warning environment, and a warning environment involves ambiguous information and penalties for incorrect actions. - Possible crises can be hard to detect, and failure to do so can result in a crisis. - - Ideally, crisis teams must remember to monitor their corrective actions on a regular basis to determine whether preventative actions have produced the desired effects. - An organization cannot count on avoiding all crises. Hence, the need remains for crisis preparation-