Like many strategic planning processes; risk management often gets shuffled to the side.
The daily urgent matters take precedent over preparing for the low probability, high-risk icebergs or “Black Swan”[1] events. Economic impact on organizations that are not prepared for crisis situations can be dire. Leaders, who perhaps did not receive proactive support from the executive level to prepare for crisis, are now faced with leading a team through complex career altering decisions in dynamic situations. Urgency of decision-making is being further exacerbated by the emergence of social media as a corporate vulnerability in times of crisis.
The causation of the crisis quickly becomes irrelevant. Whether it be a natural catastrophe, an accidental event, or a human intentional act, the leadership of the organization can quickly become challenged in relation to their ability to champion the response and recovery to the incident. Severe weather, a fire, an active shooter, or even an employee who breaches protocol on Facebook or Twitter can thrust experienced leaders into the limelight; a situation where they may be unfamiliar with how to build a crisis organization and prioritize their decision making.
Our team is seeing on a regular basis, that within progressive organizations, there is a recognized need of crisis training and preparedness as part of a regular regimen, providing a fundamental pillar of the Enterprise Risk Management program. Harvard University has been a leader in enlightening students from all organizational backgrounds and preparing them and their organizations for the crisis that may only be faced once in a career. When discussing the leadership requirements necessary to differentiate between routine emergencies and a crisis situation, Harvard professor Dutch Leonard cites that it is necessary for leaders to be “…adaptive; comfortable sharing authority and responsibility; and able to elicit information, ideas, and proposed solutions from their teams.”[2]
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Risk Assessment
The first critical step in preparing for the management of a crisis, is to conduct a thorough risk assessment. Having conducted these assessments at the corporate and community levels, I have seen the tremendous medium that is created by the process itself, in galvanizing the future crisis management “team”. The folks who will be put on the hot seat in a time of crisis, work with expert facilitators to conduct a quantitative assessment of scenarios that would impact the organization, participants agree upon the relative ranking of these threats in relation to the vulnerabilities. Often, it becomes evident that there are blind spots within the organization that may result in a high, negative impact should the worst occur.
Crisis Team Building: Stakeholder Recognition
At the beginning of the Risk Assessment process a team is created which may include community members external to the organization, known as stakeholders. As part of this team, the stakeholders are critical to the organization and are asked to participate in the risk assessment and preparedness planning process. Examples of stakeholders who are outside the organization may include responders, community representatives, subject matter experts and even regulators. This holistic approach in creating a community based team, fosters and secures the relationships, which are critical to success when the organization is in crisis. In the fullness of time, these stakeholders may be part of the annual training, exercise and evaluation regimen.
Training, Exercising and Evaluation
From the highest identified risks, threats and vulnerabilities a gap analysis may be conducted in relation to the crisis team’s ability to manage the anticipated crisis scenarios. An all hazard approach may be taken to training, exercising and evaluating outcomes. Caution is offered in that while an “all hazard approach” is a great start, there is a necessity to customize security and emergency management planning documents, training and exercising based upon the identified highest quantitative risk scenarios.
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High Reliability Organizations, Recognition Primed Decision Making, “PPOST”,
Decision making for leaders who are managing a crisis is very complex particularly when they may have never before faced an incident of true crisis. There is no time to “learn” how to be a crisis manager, while the crisis is occurring.
Some organizations regularly face emergencies and have leaders managing life and death situations on a daily basis. These organizations that utilize preparedness, training and decision making models to support the leadership to perform competently on the darkest day are known as High Reliability Organizations or HRO’s.
High Reliability Organizations or HROs offer refined models of preparedness, safety and internal learning mechanisms to ensure that incidents are managed to a minimal level of risk. Nuclear submarines, aircraft carriers, the Forest Fire Fighting Service all offer crisis management methodologies that may be applied within any organization to ensure success in a time of crisis.
Dr. Gary Klein cites Recognition Primed Decision Making as a way that the most effective Fire Command Officers manage what would be considered a crisis.[3] Within this methodology crisis leaders do not perform time consuming analysis, they just “know” what the most successful course of action is. I would offer that in the context of emergency management at the corporate or community level, Recognition Primed Decision Making can be achieved through regular training and exercising of the crisis team. As people gain expertise in their field, their ability to recognize patterns and relationships is enhanced. Ultimately the timeliness and accuracy of decisions is increased.
Regularly, the PreparedEx team works with “crisis teams” to practice models that will ultimately support their effort in a time of crisis. Organizational structures like the Incident Command System and decision making models like P.P.O.S.T. (Priorities, Problems, Objectives, Strategies and Tactics) assist leaders who must harness the energy that is created by an emerging or full blown crisis. After introducing, training and practicing these sorts of methodologies we regularly have corporate or community leaders who remark that they do not know how they would have coped with crisis without these tools in their toolboxes.
Some of the best crisis managers I have seen have come from the Fire Service (obviously I have a bias in this regard). I have noted that these great leaders have always been men and women who worry in advance, prepare and learn from past incidents. Part of this organizational learning is remembering those fire fighters (100+ every year in North America), who die during operations. These losses weigh heavily on the minds of crisis decision makers. For those we have lost, we adopt the philosophy “Through training we remember.”
[1] Taleb, N.N. The Black Swan: The Impact of the Highly Improbable. (2007).
[2] Howitt, A.M. and Leonard, H.B. Managing Crises: Responses to Large-Scale Emergencies. (2009)
[3] Klein, G. Sources of Power: How People Make Decisions (1999)
As a Senior Consultant for PreparedEx and Director of Emergency Solutions International, Mark has assisted partners from industry, the private sector and government in their “All Hazard” emergency planning, preparedness and risk assessment needs. Deputy Gillan concluded 26 years of service with the Saint John Fire Department in August of 2011. He graduated from the University of New Brunswick with a Degree in Business Administration (B.B.A.). As well, he has completed the Dalhousie University, Certificate in Incident Command, the Canadian Association of Fire Chief’s: “Chief Fire Officer” Designation (C.F.O.) and the British: Institute of Fire Engineer’s “Member’s Level” Designation (MIFireE) Award. As a Command Officer, Mark has served as Incident Commander, Safety Officer and Emergency Site Manager at a number of serious incidents. On several activations of the Saint John Emergency Management Organization, Mark has fulfilled the roles of Fire Services Representative and Manager of the EOC.