A crisis can strike in various ways, and when they do, they can have a significant impact on an organization’s finances, strategic goals, operations, and reputation. Some crises like the COVID-19 pandemic even pose a serious risk to employees’ health, safety, and lives. In such circumstances, a crisis management plan becomes a key document to guide employees regarding what they need to do.
A crisis management plan entails how an organization will react to a crisis, the key stakeholders that will be involved, and the strategies they will implement. The objective of the plan is to minimize losses and damages and return to restore regular operations swiftly.
To help you out, here are some steps to create a crisis management plan.
Step #1 – Identify Risks
The first step involves a risk assessment to identify crises that can potentially disrupt your business’s operations. Collaborate with the crisis response team, senior leadership, and stakeholders to list all possible threats to your organization. These could include product recalls, security breaches, cyberattacks, PR issues, etc.
Step #2 – Calculate the Business Impact
A business impact analysis (BIA) is a process that quantifies the potential impact of a crisis on your business. Conducting a BIA can unfold several possible effects that include
- Impaired public reputation
- Customer attrition or dissatisfaction
- Lost sales or delayed income
- Higher costs
A BIA allows you to ensure that you cover the implications of a threat from every possible angle.
Step #3 – Conduct Contingency Planning
Now that you’ve conducted a risk assessment and a business impact analysis, you can start brainstorming your alternate options. What are the steps you can take to minimize the threat faced by your business and employees?
If it’s a problem of poor ratings or reviews, you need to be prepared to respond swiftly and positively. For instance, if the customer leaves a bad review, you could address their problem or offer some compensation like a discount on their next purchase.
Step #4 – Document the Plan
In this stage, you will be documenting the plan containing the possible risks, their impact, and the strategy to deal with them. Make sure that the crisis management plan that is drafted is easy to comprehend and implement.
Step #5 – Communicate the Plan
Employees must have a clear understanding of their roles during a crisis. Firstly, you need to ensure that all the key stakeholders involved have all the information they require. In a period of crisis, employees need immediate access to information. Brainstorm ways to effectively disseminate a crisis management plan, such as via an app.
Last Few Words
These steps to create a crisis management plan will help you develop strategies that will prove to be extremely useful during a difficult phase. However, you need to know that creating a crisis management plan is only the first step. Rather, you need to continuously update it, especially when existing team members leave, or new employees are onboarded, or other significant changes occur.