It is a discipline within the broader context of management consisting of skills and techniques required to identify, assess, understand, and cope with a serious situation, especially from the moment it first occurs to the point that recovery procedures start.
A British Standard BS11200:2014 provides a useful foundation for understanding terminology and frameworks relating to crisis, in this document the focus is on the corporate exposure to risks in particular to the black swan events that result in significant strategic threats to organizations.
That said, a decent amount of research demonstrates that the remedy or response strategy after a technological crisis (such as a data breach) can contribute significantly to an organization's overall reputation.
An organization faces a crisis of malevolence when opponents or miscreant individuals use criminal means or other extreme tactics for the purpose of expressing hostility or anger toward, or seeking gain from, a company, country, or economic system, perhaps with the aim of destabilizing or destroying it.
Crises stemming from skewed management values occur when leaders prioritize short-term financial gains while disregarding broader social responsibilities and key stakeholders beyond investors.
[17] James defines organizational crisis as "any emotionally charged situation that, once it becomes public, invites negative stakeholder reaction and thereby has the potential to threaten the financial well-being, reputation, or survival of the firm or some portion thereof".
James's research demonstrates how leadership competencies of integrity, positive intent, capability, mutual respect, and transparency impact the trust-building process.
Companies like Walmart have been recognized for their role in providing emergency relief [20] after having witnessed the incredibly speedy and well-coordinated effort to get supplies to the Gulf Coast of the United States in anticipation of Hurricane Katrina.
Crisis handlers not only engage in continuity planning (determining the people, financial, and technology resources needed to keep the organization running), but will also actively pursue organizational resilience.
In the wake of a crisis, organizational decision makers adopt a learning orientation and use prior experience to develop new routines and behaviors that ultimately change the way the organization operates.
There are 3 essential steps that an organization can take to prepare for and withstand a communications crisis: 1) Define your philosophy; 2) Assess your vulnerabilities; 3) Develop a protocol.
It includes projection of the future based on ongoing monitoring of business internal and external environment, as well as selection and implementation of crisis prevention strategy and operating management.
This is including current status control based on ongoing monitoring of the internal and external environment, as well as crisis-coping strategy selection and implementation.
There are 3 phases in any crisis management as shown below No corporation looks forward to facing a situation that causes a significant disruption to their business, especially one that stimulates extensive media coverage.
The viral effect of social networks such as Twitter means that stakeholders can break news faster than traditional media – making managing a crisis harder.
[37] In 2010 Procter & Gamble Co called reports that its new Pampers with Dry Max caused rashes and other skin irritations "completely false" as it aimed to contain a public relations threat to its biggest diaper innovation in 25 years.
[39] When another bottle of tainted Tylenol was discovered in a store, it took only a matter of minutes for the manufacturer to issue a nationwide warning that people should not use the medication in its capsule form.
At Mattel, just after the 7 a.m. recall announcement by federal officials, a public relations staff of 16 was set to call reporters at the 40 biggest media outlets.
This led to an arrest, which Pepsi made public and then followed with their first video news release, showing the production process to demonstrate that such tampering was impossible within their factories.
According to American University's Trade Environmental Database Case Studies (1997), local residents were not sure how to react to warnings of potential threats from the Union Carbide plant.
Hundreds of miles of coastline were polluted and salmon spawning runs disrupted; numerous fishermen, especially Native Americans, lost their livelihoods.
[54] In a similar fashion the plans aim to address all audiences in need of information including parents, the media and law enforcement officials.
This plan is intended to integrate public and private response by providing a common language and outlining a chain-of-command when multiple parties are mobilized.
The NRP recognizes the private sector as a key partner in domestic incident management, particularly in the area of critical infrastructure protection and restoration.
CAP helps create a consistent emergency alert format to reach geographically and linguistically diverse audiences through both audio and visual mediums.
In describing crisis, President Abraham Lincoln said, "We live in the midst of alarms, anxiety beclouds the future; we expect some new disaster with each newspaper we read".
[59] A brief description of the five facets of crisis leadership includes:[60] While all countries encounter various crises over the course of their existence, they utilize different strategies that reflect their particular structure and circumstances.
By relegating the management of health care to regions, political parties are able to implement conflicting measures that fail to achieve the greater national or international goals.
One of the scientists' key recommendations was that "existing and future legislation and instruments should be integrated in a framework that is capable of dealing with increasingly systemic and large-scale crises in a structural way".
[66] Global health organizations have also received scrutiny from around the world for falling short of expectations during previous crises which has deepened the distrust of these international groups.