Crisis Management

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CRISIS MANAGEMENT Crisis management is the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. Three elements are common to most definitions of crisis: (a) a threat to the organization (b) the element of surprise (c) a short decision time. Venette argues that crisis is a process of transformation where the old system can no longer be maintained. Therefore the fourth defining quality is the need for change.
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  CRISIS MANAGEMENT Crisis management is the process by which an organization deals with amajor event that threatens to harm the organization, its stakeholders, or thegeneral public. Three elements are common to most definitions of crisis:(a) a threat to the organization(b) the element of surprise(c) a short decision time.Venette argues that crisis is a process of transformation where the oldsystem can no longer be maintained. Therefore the fourth defining quality isthe need for change. If change is not needed, the event could more accuratelybe described as a failure or incident . Introduction Crisis management consists of: ã Methods used to respond to both the reality and perception of crises. ã Establishing metrics to define what scenarios constitute a crisis andshould consequently trigger the necessary response mechanisms. ã Communication that occurs within the response phase of emergencymanagement scenarios. ã Crisis management methods of a business or an organization arecalled   Crisis Management Plan .  CATEGORIES OF CRISIS: 1.SUDDEN CRISIS: Robert B. Irvine, president of the Institute for Crisis Management, notedin   Communication   World   that the Institute characterizes most business crisesas one of two types: sudden crisis or smoldering crisis. We define a suddencrisis as a disruption in the company's business that occurs without warningand is likely to generate new coverage, he said. Examples of such eventsinclude business-related accidents, natural disasters, sudden death ordisability of a key person, or workplace violence. 2.SMOLDERING CRISIS: Smoldering crises, meanwhile, are defined by the Institute as any seriousbusiness problem that is not generally known within or without the company,which may generate negative news coverage if or when it goes 'public' andcould result in more than U.S. $250,000 in fines, penalties, legal damageawards, unbudgeted expenses, and other costs. Examples of smolderingbusiness crises include indications of significant regulatory action, governmentinvestigations, customer allegations, media investigations. In someinstances, Irvine added, crisis situations may be either sudden orsmoldering, depending on the amount of advance notice and the chain of events in the crisis.   Types of crisis During the crisis management process, it is important to identify types of crises in that different crises necessitate the use of different crisismanagement strategies. Potential crises are enormous, but crises can beclustered. Lerbinger   categorized seven types of crises  Natural disaster   Technological crises  Confrontation  Malevolence  Organizational Misdeeds  Workplace Violence  Rumors Natural crises Natural crises, typically natural disasters considered as 'acts of God,' are suchenvironmental phenomena as   earthquakes ,  volcaniceruptions   ,  tornadoes   and   hurricanes   ,  floods ,  landslides ,  tsunamis , storms,and   droughts   that threaten life, property, and the environment itself.  Example:   2010 – 2011 flood of sindh, 2005 earthquake of NWFP. Technological crises  Technological crises are caused by human application of science andtechnology. Technological accidents inevitably occur when technologybecomes complex and coupled and something goes wrong in the system as awhole (Technological breakdowns). Some technological crises occur whenhuman error causes disruptions (Human breakdowns). Confrontation crises Confrontation crises occur when discontented individuals and/or groups fightbusinesses, government, and various interest groups to win acceptance of their demands and expectations. The common type of confrontation crises isboycotts, and other types are picketing, sit-ins, ultimatums to those inauthority, blockade or occupation of buildings, and resisting or disobeyingpolice. Example:   boycottof Nike & Pepsi. Crises of malevolence
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