The way in which your business responds to a crisis has a lasting impact on its revenue and its reputation. Yet too many businesses have a short term mentality when considering crisis management - effectively only thinking about how to restore operations as quickly and cost-effectively as possible.
To develop business resilience, it is essential to consider not only the quick wins that will allow you to restore efficiency as quickly as possible, but also the long-term actions that will secure stakeholder confidence and allow your business to maintain or even strengthen its reputation as a reliable and trustworthy organisation.
Short-term crisis management response
Evaluate your existing processes and determine how effective your business continuity plan would be in the event of an unforeseen circumstance or event affecting your day to day activities.
Consider who would need to be informed if you were to close temporarily and how this would affect your business' reputation. What actions would you need to take to reassure your customers, staff, shareholders and investors that your business was stable and handling the crisis effectively?
Would you need to inform any third party bodies, such as industry associations or legal regulators of the emergency, and if so, do you have an effective mechanism for doing so, particularly if you are unable to access your premises?
Do you have a backup plan for employees to work remotely and a method of safeguarding business assets and information?
The next part of your crisis management response planning is to consider the longer-term implications of a crisis in order that you can begin to address the causes of those implications and mitigate against them causing further harm to your business.
Consider your business' key objectives and overarching strategy to understand where the true value lies. Consider the type of events that you may encounter and risk assess them based on their likelihood of occurrence and the damage that they would cause should they occur.
Consider the internal controls that you have in place, the communication mechanisms, your preferred methods of marketing your business and the effect that a crisis or unexplained closure would have on public confidence and your business' reputation.
Typically, consumers are quick to guess at reasons for unexplained closures so it usually pays to have a strategy in place which will reassure the public of the reason for the closure, briefly explain the process in place to remedy the crisis and publicise a planned reopening date. If customers are affected by the closure, ensure that they are contacted as a priority and reassured of the actions that are being taken and updated as necessary.
You must ensure that you have a plan in place to assess and evaluate the handling of a crisis and the actions taken so that lessons can be learned, processes updated and plans put in place to ensure smoother operation in the future.
If your business takes its crisis management response seriously, stakeholders will respect and trust your judgement should an emergency situation arise. You cannot mitigate against every eventuality, but the way in which you respond to an emergency will resonate with your stakeholders and protect your reputation.
For help in developing a tailored strategy for your business, please contact Needhams today.