Unit 5: Crisis management
What is a crisis?
Guth (1995) described a crisis as 'a major,
unpredictable event that has potentially
negative results. The event and its aftermath
may significantly damage an organization and
its employees, products, services, financial
situation and reputation.‘
A crisis is not simply a serious problem. It is
less predictable, it could require a significant
investment in time and money, and it often
attracts public attention.
Types of crisis
1. Act of God: Due to the unpredictability of nature, an Act
of God is sudden and unexpected, e.g., flood, volcanic
eruption, earthquake, tsunami, tornado.
2. Man-made Crisis: Occurs as a result of a human act
and therefore is potentially preventable, e.g., terrorism,
epidemic, fire disaster, labor or civil unrest, shooting, plane
crash, product tampering.
3. Emerging Crisis: Allows time for research and planning
but may suddenly erupt, e.g., employee dissatisfaction,
substance abuse in an organization, bad business practices,
risk of vehicle malfunction, chemical accident at a plant.
4. Sustained Crisis: Persists for months/years despite
management efforts to defuse it, e.g., persistent rumors
regarding downsizing, retrenchment, closure, mergers,
takeovers.
Crisis management phases
I. Issues management: (1) collect data and
(2) develop communication strategies.
II. Planning prevention: (3) monitor the
environment via warning systems, (4)
disseminate information within the
organization.
III. The crisis: (5) targeting messages, (6)
pre-empt negative publicity, (7) critique the
company’s response.
IV. Post-crisis: (7) evaluate the crisis plan,
(8) continue to inform the media, (9) monitor
the issues, (10) listen to the stakeholders.
Issues management
1. Collect data
Activities: Monitoring media, conducting
surveys, reviewing industry trends, and
seeking feedback from stakeholders.
Issues management
2. Develop communication strategies
Activities: Identifying key messages,
choosing appropriate communication
channels, and preparing for various crisis
scenarios.
Planning prevention
3. Monitoring the environment via warning
system
Activities: Using monitoring tools for social
media, news, and internal reports to identify
trends and warning signals.
Planning prevention
4. Disseminate Information Within the
Organization:
Activities: Holding meetings, sending
internal communications, and providing
training to prepare staff for potential crises.
The crisis
5. Targeting messages:
Activities: Segmenting audiences,
customizing messages, and ensuring
consistent communication across all channels.
The crisis
6. Pre-empt Negative Publicity:
Activities: Engaging with the media, issuing
public statements, and using social media to
provide positive information.
The crisis
7. Critique the Company’s Response:
Activities: Gathering feedback, assessing
response actions, and making necessary
adjustments to plans and strategies.
Post-crisis
8. Evaluate the Crisis Plan:
Activities: Conducting formal reviews,
identifying strengths and weaknesses, and
updating the crisis management plan.
Post-crisis
9. Continue to Inform the Media:
Activities: Issuing regular updates, sharing
positive outcomes, and engaging with media
outlets to manage public perception.
Post-crisis
10. Listen to the Stakeholders:
Activities: Collecting stakeholder feedback,
incorporating suggestions, and demonstrating
responsiveness to stakeholder concerns.
Case study 1
Background:
Lee Min-Ji is a popular member of the girl group
“Radiant.” She has a massive fan following due to her
talent, charm, and single status, which is often seen
as a key part of her public image.
The Crisis:
Min-Ji suddenly announces her marriage to her long-
time, non-celebrity boyfriend without any prior hints.
The announcement shocks fans and the public,
leading to a mixed reaction. Some fans feel betrayed,
thinking she should have shared her relationship
status earlier, while others are supportive but
concerned about her future with the group.
Case study 2
Background: Gourmet Garden is a high-end
restaurant known for its exquisite cuisine and
luxurious dining experience. The restaurant
has a loyal clientele and is frequently featured
in culinary magazines.
The Crisis: Several diners report severe food
poisoning after dining at Gourmet Garden. The
incident quickly gains media attention,
damaging the restaurant's reputation. Health
authorities launch an investigation, and the
restaurant faces potential closure.
Case study 3
Background: Ecopolitan is a popular fashion
brand known for its eco-friendly products and
commitment to sustainability. It enjoys a
dedicated customer base that values ethical
fashion choices.
The Crisis: A documentary exposes poor
working conditions in one of Ecopolitan's
overseas factories, including underpayment
and unsafe environments. The revelation
triggers a backlash from customers and
activists, demanding immediate action.
Case study 4
Background: Avery Brooks is a prominent social
media influencer known for her lifestyle content and
brand endorsements. She has millions of followers
who look up to her for fashion tips and personal
advice.
The Crisis: Avery is accused of promoting a
controversial dietary supplement that is later
revealed to have harmful side effects. Several
followers claim they experienced health issues after
using the product based on her recommendation. The
news spreads quickly, leading to backlash from both
fans and the media, questioning her ethics and
integrity.
Case study 5
Background: SkyHigh Airways is a major
international airline known for its excellent
customer service and extensive route network. It
enjoys a strong reputation in the industry and
among travelers.
The Crisis: A video surfaces showing a passenger
being forcibly removed from a SkyHigh flight due
to overbooking. The footage goes viral, leading to
widespread condemnation and calls for a boycott
of the airline. The incident tarnishes SkyHigh's
image and raises questions about its customer
service policies.
