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CRISIS MANAGEMENT
What Is the Role of Human Resources?
Due to the unpredictability of global events, many modern organizations attempt to identify potential crises before they occur in order to sketch out plans to deal with them. When and if a crisis occurs, the organization must be able to drastically change course in order to survive.
The COVID-19 crisis that began in early 2020 can be expected to become a textbook example of crisis management. Businesses around the world were forced to shut their doors. Millions of employees were sent home. Essential services struggled to function. History will judge how effective the powers-that-be were in their crisis management skills.
Crisis Management Vs. Risk Management
Crisis management is not necessarily the same thing as risk management. Risk management involves planning for events that might occur in the future, crisis management involves reacting to negative events during and after they have occurred.
An oil company, for example, may have a plan in place to deal with the possibility of an oil spill. If such a disaster actually occurs, the magnitude of the spill, the backlash of public opinion, and the cost of cleanup can vary greatly and may exceed expectations. The scale makes it a crisis.
Type of Crisis
A crisis can either be self-inflicted or caused by external forces. Examples of external forces that could affect an organization’s operations include natural disasters, security breaches, or false rumors that hurt a business's reputation.
Self-inflicted crises are caused within the organization, such as when an employee smokes in an environment that contains hazardous chemicals, downloads questionable computer files, offers poor customer service that goes viral online. An internal crisis can be managed, mitigated, or avoided if a company enforces strict compliance guidelines and protocols regarding ethics, policies, rules, and regulations among employees.
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