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What is Crisis Management?
Crisis management, a facet or risk management, is a process-based approach to addressing highly unfavorable situations arising within an organization. It involves developing a strategy and plan for addressing the cause and consequences of an unfavorable situation. It generally involves establishing new processes defined by clear roles and responsibilities.
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The processes must be acknowledged and understood across the company.
- Note: Sub-processes within crisis management include:
- Emergency Management - This is the process of stopping or alleviating the immediate negative impact of a crisis scenario. It can be understood as stemming from the severity of the effects of the crisis situation to allow for long-term management of the negative consequences.
- Business Continuity Management - Undertaking the steps necessary to allow for the continuation of business operations in the midst of or in response to a crisis.
The objectives of crisis management include:
- Prevention - Preventing the occurrence of a negative situation.
- Avoidance - Avoiding the negative consequences associated with a potential crisis.
- Assessment - Understanding the effect or impact of an unfortunate situation or circumstance.
- Management - Organizing organizational resources through process and procedure to contain and mitigate the effects of an unfavorable situation.
- Conclusion - Bringing about an end to the negative situation giving rise to the organizational crisis.
Components of a crisis management plan include:
- Processes, procedures, and roles in addressing the reality or perception of a crisis.
- Defining what constitutes a crisis through recording information and establishing metrics for a response.
- Establishing lines of communication with internal and external stakeholders.
What are the most common categories of crises:
- Natural disaster
- Technological crisis
- Organizational Misdeeds
- Workplace Violence
- Terrorist attacks/man-made disasters
What is Crisis Management Strategy?
Crisis management strategy, a facet of management strategy, is a strategic plan with missions, goals, and objectives related to avoiding, preventing, identifying, managing, and ending crisis situations. This includes identifying impending situations that can result in a crisis. Developing a strategic plan for responding to the situation through new processes and activities. Then implementing a process for maintaining and monitoring the effects of the situation. Types of Strategic plans include:
- Crisis Management Plan - These deals with planning the organizations response to the crisis situation.
- Contingency Planning - This involves developing plans for potential scenarios that could lead to a crisis. It is a form of preemptive planning that ensures the organization is prepared for these situations.
- Business Continuity Planning - This is a plan for restoring or maintaining business operations that are harmed or negatively affected as a result of the crisis.