Effective Crisis Leadership: Navigating Turbulent Times with Resilience and Agility was originally published on Ivy Exec.
In 2018, Starbucks CEO Kevin R. Johnson was facing a crisis.
In one of his Philadelphia stores, two Black men were wrongfully accused and arrested due to Starbucks employees’ racial profiling. If the CEO didn’t handle the issue effectively, the company risked losing its reputation.
So, Smith took action. He apologized for what transpired and took responsibility himself, rather than absolving himself and placing the blame on “rogue” employees.
Next, Smith announced that he would close all of the 8,000 Starbucks stores in the U.S. for an afternoon so employees could undergo racial bias training.
Ultimately, Smith handled this incident well, retaining the trust of employees and customers. He demonstrated effective crisis leadership.
Over the last few years, organizations have withstood – or withered – in the face of many types of crises. These range from the international pandemic to individual profit losses or PR disasters. But executives handle both types of crises similarly: they plan for these eventualities and successfully lead their teams through dark times.
This article discusses useful tactics for effective crisis leadership.
Have plans in place before, during, and after crises.
You aren’t prepared for crises if you don’t have prevention, damage containment, and recovery plans in place.
Writing for the Wharton School’s business journal, Erika James and Lynn Perry Wooten describe these three necessary plans:
1⃣ Before a crisis, you should have analysis plans in place that help you avoid crisis situations. For instance, if you don’t have daily problem checks, then you may not be able to avoid problematic situations.
“How can you accurately determine any needs or shortfalls, and what additional input do you need?” the authors ask.
2⃣ During a crisis, you should shift your attention to containment. In this stage, you should collect information from as many stakeholders as possible. What’s more, you want to consider what might be stopping you from changing course or innovating during the incident.
“Who (else) can you learn from? Whose perspective or expertise can shed important light on this crisis, and are there any players within or external to your organization who can augment your knowledge and understanding?” asked Perry and James.
3⃣ The final stage is “After a Crisis,” when you should plan to recover and reflect. What was successful about your plan? What should have been modified?
Use “holding” tactics to reassure your team during a crisis.
In times of uncertainty, says Gianpiero Petriglieri for Harvard Business Review, successful leaders know how to “hold” others.
In other words, they help their team members alleviate stress by interpreting what’s going on and offering clear next steps.
“They think clearly, offer reassurance, orient people, and help them stick together. That work is as important as inspiring others. In fact, it is a precondition for doing so,” he said.
Executives who can hold during crises develop mutual support amongst their teams and are better able to find a way forward. However, when leaders can’t successfully hold, fragmentation usually follows.
For instance, BP’s top leaders offered two different messages after the Gulf of Mexico oil spill crisis. Some shared upbeat messages, while others asked their teams for support in the cleanup efforts.
“Despite the stress, working closely with one’s boss and colleagues on the response was more containing and informative. It reassured those who did it about the company’s integrity and long-term viability.
Being held as we work through a crisis…is more useful than being told how bright the future is,” said Petriglieri.
Rely on your internal network to handle crises; avoid top-down declarations.
One of the mistakes leaders make during times of crisis is sending top-down directives.
Instead, a better tactic, McKinsey & Company says, is organizing a network of teams that can understand, address, and solve problems during crisis situations.
“Although the network of teams is a widely known construct, it is worth highlighting because relatively few companies have experience in implementing one. A network of teams consists of a highly adaptable assembly of groups, which are united by a common purpose and work together in much the same way that the individuals on a single team collaborate,” they note.
This network of teams incorporates several different functions outside of business-as-usual operations. For instance, some parts of the team should help coworkers adapt to new norms while others stabilize supply chains. Others should focus on customer engagement and financial stress testing, the research organization advises.
These teams aren’t simply advising executives, either; they need to be able to create plans and implement them.
“Merely soliciting experts’ ideas is not enough; experts must gather information, devise solutions, put them into practice, and refine them as they go. And they are adaptable, reorganizing, expanding, or contracting as teams learn more about the crisis and as conditions change,” the report’s authors Gemma D’Auria and Aaron De Smet say.
Tools for Effective Crisis Leadership
Successful crisis leadership relies on preparation before, during, and after incidents.
Whether you’re facing a global issue or an isolated event, you should understand how you’ll behave and direct your team through struggles.
Columbia Business School shares more about how to build your team’s trust during a crisis in the article “The Trust Factor: Five Ways to Maintain Trust During a Crisis.”
