Corporate or government leaders can view crisis as either an interruption or a test of their stewardship of the organization. When crisis strikes, how you view it naturally influences how you and your organization respond.
Writing in Strategy & Leadership, Helio Fred Garcia looks at good and bad examples of crisis response. Garcia says Exxon’s ineffective response to the Exxon Valdez oil spill led the public to believe that the company’s primary concern was not the harm the spill caused. The government’s response to the New Orleans flood showed a similar indifference.
Garcia compares President George W. Bush’s response to the attacks of September 11, 2006 to his response to Hurricane Katrina, where the President seemed “disengaged, uninformed, and unconcerned.” Federal Emergency Management Agency Director Mike Brown's admission on CNN that the government was unaware that thousands were stranded without water at the convention center added to the feeling that government leaders were indifferent to the plight of New Orleanians.
The perception of indifference is the single largest contributor to reputation harm in the aftermath of a crisis, especially when there are victims, says Garcia.
As for examples of good crisis response, Garcia points to the McDonald’s Corporation and the Boeing
Company. McDonald’s left little room for speculation about its future and minimized its stock
volatility by swiftly appointing a new CEO just two and half hours after announcing the death of CEO James Cantalupo.
Harry Stonecipher was tapped by Boeing to replace CEO Phil Condit after a scandal involving the
recruitment of Pentagon employees. Stonecipher, who instituted a revised Code of Conduct, was quickly dismissed after the company learned that he had violated his own code by having a romantic relationship with a female subordinate.
Both McDonald’s and Boeing understood the importance of the “Gold Hour” of crisis response. Garcia says the Gold Hour refers to the observation that incremental delays in responding to a crisis have
greater than incremental impact on the outcome.
Here is Garcia’s lesson for leaders: Effective leaders (1) demonstrate situational awareness in a
crisis, grasping the significance of the underlying event and its likely impact on the company and its
stakeholders, and (2) see crisis response not as an interruption in their stewardship of a company, but
as the test of that stewardship.
Garcia,
Helio F. "Effective Leadership Response To Crisis."
Technorati Tags: public relations, crisis communications
