Crises are an unfortunate fact of life and history. Whether they be of identity, confidence, the Third Century, or any kind of disaster, they're nearly unavoidable — and businesses are particularly vulnerable to them.

The nature of crises a company might face can range from financial emergencies to cyber attacks to natural disasters. And the ramifications of these kinds of incidents can be lasting and catastrophic if they're not quickly and effectively buttoned up.

That makes a sound crisis management strategy a "should have" for smaller, maturing businesses and an absolute "must have" for larger, more well-established ones. You can't control the crises your business will run into, but you can control how you prepare and respond.

Here are some statistics that show why your business needs a crisis management strategy.

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Stats on Why You Need a Crisis Management Strategy

  • 69% leaders have experienced at least one corporate crisis from 2014-2019 — with the average number of crises experienced being three. (PWC)
  • 59% of communicators say they have a communications strategy drafted, but only 45% admit to having a documented crisis communications plan. (JOTW)
  • 37% of consumers who use social media to complain or question brands expect to get a response in under 30 minutes. (ConverSocial)
  • 56% of surveyed senior-level executives working in ethics, compliance, risk management, and other fields related to crisis management suggested they were only "somewhat confident" in their crisis management plans. (Morrison & Foerster and Ethisphere)
  • 46% of surveyed senior-level executives working in ethics, compliance, risk management, and other fields related to crisis management were "somewhat confident" in their ability to actually manage a crisis. (Morrison & Foerster and Ethisphere)
  • 10% of surveyed senior-level executives working in ethics, compliance, risk management, and other fields related to crisis management were "minimally confident" in their ability to actually manage a crisis. (Morrison & Foerster and Ethisphere)
  • 5% of surveyed senior-level executives working in ethics, compliance, risk management, and other fields related to crisis management were “not confident at all" in their ability to actually manage a crisis. (Morrison & Foerster and Ethisphere)
  • Only 29% of companies who faced a major crisis from 2014-2019 say they have no staff dedicated to crisis preparedness or response. (PWC)
  • 74% of companies who faced a major crisis from 2014-2019 sought outside help either during or after their most serious crisis. (PWC)
  • 42% of companies who faced a major crisis from 2014-2019 said they were "in a better place" post-crisis. (PWC)
  • 36.4% of businesses reported they had no budget allocated for emergency communications tools or software in 2019. (BCI)
  • Between 2010 and 2017, headlines with the word "crisis" and the name of one of the top 100 companies as listed by Forbes appeared 80% more often than in the previous decade. (McKinsey)
  • Much of the training top executives receive around crisis management is little more than training in crisis communications. (McKinsey)
  • 62% of companies have crisis plans — though it's uncertain how many regularly update them. (PRNEWS and CS&A International)
  • 26% of companies say their organization's crisis plan is "well known" to crisis management team (CMT) members. (PRNEWS and CS&A International)
  • 54.2% of organizations cite communicating with staff as a key challenge during an emergency, but only 61.7% of organizations seek to ensure that employees’ contact information is kept up to date. (BCI)
  • 28.9% of companies don't know if their crisis management plan is up to date. (BCI)
  • Only 30% of marketers and PR pros say they conduct a risk assessment of potential threats to their brand’s reputation about once per year. (Crisp and PR News)
  • 54% of marketers and PR pros say one of their biggest issues in crisis management is reacting fast enough. (Crisp and PR News)
  • 52% of marketers and PR pros say preparing the right response is one of their biggest issues in crisis. (Crisp and PR News)
  • 48% of marketers and PR pros say having enough resources to adequately manage the crisis well is one of their biggest issues in crisis. (Crisp and PR News)
  • 64.25% of marketers and PR pros say how a crisis affects a brand's reputation is one of the most critical pieces of information your C-suite wants to know after one occurs. (Crisp and PR News)

Navigating Crisis Management

A solid approach to crisis management addresses the various kinds of crises your business might feasibly face. That will vary from company to company — depending on factors like your scale, organizational structure, the technology you leverage, and your geographic location.

A large enterprise that relies on a new custom CRM to support almost all of its business operations is more prone to a large-scale technological crisis than most other companies.

And a business headquartered in the thick of Hurricane Alley will probably need to prepare for a natural disaster more than an organization located in a place with milder, more predictable weather.

Should you find yourself in the thick of a crisis, it's important you remain composed — and having a well-constructed crisis management strategy makes that considerably easier.

Try to keep tabs on any warning signs that might help you get ahead of a crisis before it starts, but if you miss those signs, you need to carefully assess the potential fallout soon after the crisis begins. Make sure your team is braced for the worst.

Once the crisis is in motion, hash out the aspects of your response plan you're going to use to remedy the situation, and put them in effect. As you carry out your plan and the situation resolves, start to plan your recovery.

Prepare to get all your employees back into their day-to-day operations and ensure customers are set up for success with your products once again. For a more thorough explanation of this process, check out this article.

As I said, the causes of crises are beyond your control, but the strategies you employ to prepare and respond to them aren't. No matter the scale or nature of your business, it always serves you to have a crisis management plan on hand.

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Originally published Oct 2, 2020 8:00:00 AM, updated October 02 2020

Topics:

Crisis Management