March 30, 2018

Crisis Management Solution Protocol

by Mark M. Kitrick, Kitrick, Lewis, & Harris, Co., LPA

No matter how well you believe your business may be doing, you will likely face a work crisis of some magnitude, whether it be a death, natural disaster, theft, loss of a major customer, etc.

How do we best prepare for a plethora of potential problems? There are three salient steps to creating and implementing your crisis management protocol.

First, pro-active preparation is critical. Early in the business formation, assume any number of problems could occur and then proactively prepare. Assume the worst and ascertain how you would deal with the crisis. This is called “pre-mortem analysis.” Here are a few examples: if there is an untimely death of an owner or key employee, ascertain who will take over. Has someone been taught, mentored and groomed as a replacement? Is there appropriate life insurance in place? If there is an internal bookkeeping theft, is there commercial theft insurance that can cover losses? Do you have an independent person/entity regularly review the books? If you have one major customer, do not assume that will always be the case. Instead, develop at least two customers as a base. Do you regularly backup all computer systems and data? Did you create policies and procedures for your employees that they can rely on?

Second, do not fall victim to the classic psychological “denial” response. Most business owners do not want to assume or accept the worst. We only like to hear information that comports with our views, known as confirmation bias. This often leads to denial which can be fiscally deadly, among other things. To combat our psychological denial response, ordain someone in your company to be a “naysayer” on a regular basis. That will force you to deal with the other side of the argument when contending with ongoing business ideas, plans and issues. However difficult it may be, this approach leads to healthy discussions, which creates successful decision-making. And it gets you far ahead of potential problems. Ultimately, if confronted with a crisis that may become or is public, hire a Public Relations (PR) Professional to contend with it, realizing that you are not an expert in PR.

Third, surround yourself with the best experts and employees you can find, whether it be accountants, lawyers, insurance and financial advisors, publicists, social media and computer professionals, and so on. Laying this foundation will allow your business to flourish.

In sum, diligently following these three basic, important steps on crisis management protocol will keep your company as successful as possible. When faced with stress, you will be fully prepared and able to act.