To understand the importance of effective crisis management, one first needs to understand what could be a crisis for a brand. A crisis can mean different things to different people and different entities.
For businesses and brands, a crisis could be potentially harmful to the brand or the company – to its reputation, tangible or intangible assets, resources, etc. Every business and brand is susceptible to a crisis, regardless of size, location, model, or industry.
The best thing a company can do in the face of this is to be prepared to manage a crisis. Some simple steps in effective crisis management can prevent a corporate disaster.
What is a crisis?
Any event that potentially harms the health, standing and success of a business can be regarded as a crisis. Internal and/or external factors could cause the problem. It can be of varying severity, determining how the brand responds to the situation. Thus, every business should always have an effective crisis management plan.
What is crisis management?
The process of being prepared to manage any crisis or emergency that a business may encounter is called crisis management. It is essential to a business’s public relations, strategy, and operations.
The Crisis Management Process
Crisis management is not as straightforward as it sounds, but it is essential and critical. Taking a step-by-step strategic approach to preparing for a crisis can be very effective and efficient for the business. The crisis management process can be divided into three key phases:
Prevention is always better than cure. This is what the pre-crisis stage of crisis management is about – preventing a potential crisis. The most critical steps for the brand at this stage would be to hire and train a crisis management team and conduct practice drills. The other important thing to do at this stage is to draft the communication the brand would share in case a crisis occurs to release the relevant information to the stakeholders and public, which is critical for branding and CRM.
Crisis Response Stage
Suppose a crisis has occurred; what does a brand do in the face of that? This is what the crisis response stage is all about. During the crisis response stage, a brand would focus on responding to different events of the crisis. Any crisis management plans a business has been implemented during this stage. Moreover, all the preparation and communications drafted during this stage would be used in the crisis response stage.
This is the stage after the crisis subsides. Crisis management is a never-ending process, not even after the problem has ended. During this stage, the business gets in touch with various stakeholders – employees, customers, vendors, etc.—to answer any queries and address any issues they may be facing. This is also the time for the crisis management team to meet and discuss how they responded to the crisis, what went well, what could be done better, etc. The notes from this event would then be used to improve the steps taken during stages 1 and 2 of crisis management.
Why is a crisis management plan required?
A crisis management plan defines a process that an enterprise can follow when it encounters a crisis. A crisis management plan needs to be prepared before a problem is encountered. If no crisis management plan is in place, the enterprise would not be ready or have a proper direction to respond to the crisis and minimize the damage. It could lead to issues of varying severity on multiple fronts – legal, operational, human resources, public relations, etc. But the business and the CRM would usually take the hit during a crisis on the front.
In the business environment, uncertainties are galore. Crisis management tools can helps the business prepare for unplanned situations and implement damage control measures as soon as it encounters troubled waters.
How can crisis management plans change your brand and CRM?
There are multiple advantages to having effective crisis management measures and plans in place, such as:
- Maintain and uphold the reputation of your brand – especially among the customers, competitors, vendors, etc., even when encountering a severe crisis
- Be seen as a responsible brand that focuses on the health, safety, and well-being of all entities – people & resources, internal & external
- Strengthens the CRM measures as customers can have greater faith in an enterprise that is prepared for a crisis and would be honest with them about the situation
- Maintain and even improve the brand productivity during and post the crisis
- Reduce downtimes and work towards quicker resolutions
- Customers appreciate it when a business is proactive and provides detailed information instead of leaving them speculating and grappling to find information
- Adversity does not build character; it reveals it, and how a business manages a crisis can significantly impact its brand and customer relationship management. Businesses need to take essential steps, such as the following, to ensure there is a minimal adverse impact on their branding and CRM:
- Video conferencing with customers to update them about the situation
- Broadcast emails to customers and stakeholders to provide market updates and reassurances and inspire thought leadership
- Conduct standup meetings with internal stakeholders
- Prioritize the activities and tasks that need to be carried out
- Share as much information as possible to control rumors and misinformation
- Appoint a point of contact that employees and customers can reach out to with any questions and control the narrative
Besides this, a business can divide the crisis management team across territories or hierarchies to ensure more effective crisis management. Based on the size of the organization, the type of crisis it is likely to encounter, the geographical spread of the business, and the size of the crisis management team, the teams can be divided to have a more focused approach to crisis management. The business could have regional emergency management, site emergency response, and business support teams, as necessary.
Read Also – How Social Listening Helps in Crisis Management?
How do you devise a crisis management plan to change your brand and CRM?
Here are some fundamental steps that a business can take to build a crisis management plan that will help it change its brand and its CRM:
- List out the different potential crises that the business is likely to encounter
- Identify their impacts on the business, especially on the branding and CRM
- Examine the different ways in which the business can respond to these potential crises
- Assign responsibilities to different individuals around who will perform which task and take what action when it comes to responding to the crises
- Develop robust resolution and mitigation plans for the identified potential crises, no matter how big or small
- Impart adequate training to everyone in the crisis management team as well as the employees at large
- Keep revising the crisis management plans in real-time to keep them updated and relevant
- Employ relevant crisis management team professionals like crisis managers, crisis management advisors, emergency management directors, public relations specialists, human resource advisors, legal advisors, medical advisors, HSE (Health, Safety, Environment) advisors, etc.
- Leverage the power of social media and public relationships to control the spread of rumors and misinformation about the current status of your business
- Preparing your business for potential crises by putting in place effective crisis management plans helps the company maintain a positive and professional reputation in the industry, especially with customers and competitors as well as with the business’s employees.
- Consider the different stages of a social media crisis and crisis management, and have the appropriate processes and people in place. The key is to stay connected and be transparent & honest. The aim of every crisis management strategy boils down to minimizing long-term, negative repercussions and damage.
Customer relationships and branding take years to build and nurture, but lousy crisis management can ruin everything for the business. In this sense, the importance of effective crisis management cannot be emphasized enough.
Prevention is always better than cure, so a business should actively work to avoid tumbling into troubled crisis waters. However, despite one’s best efforts, encountering a crisis is often almost unavoidable. This is where effective crisis management becomes critical, and it would positively impact the business’s brand and CRM.