As we explain in our e-book Surviving Crisis, understanding the triggers to crisis provides valuable insight to mitigate the likelihood or impact of your next incident.
Sifting through the aftermath of crises helps identify their most common culprits. Among these include the seven deadly crisis sins:
1. Immorality
As artificial intelligence reaches new heights, it’s important not to let emotional intelligence take a backseat in an organisation. Profits over corporate social responsibility is an unsustainable mindset, it displays a lack of moral agency that will exacerbate a crisis, rather than combat it. Ethics are just as important before a crisis as it is after the event breaks. With moral decision-making, it’s essential that an element of sound reasoning is included and egoistic behaviour is avoided. Woolworths found themselves in trouble with Fair Work in 2019 with the severe underpayment of staff, prioritising cost cutting without adherence to the values an organization claims to be supporting is inviting trouble.
2. Legalities matter: disregard for legal compliance
They say rules are made to be broken, but when it comes to abiding by environmental or financial legislation it’s best to play by the directive. This is one of the most common causes of crisis. Even if a leader believes they are above the law there should be structures and processes to ensure it is complied with. Employees aren’t expected to know every law, but knowing when to seek out professional advice is essential.
3. Irresponsive culture
Our world, and corporate culture, is ever changing yet some organisations may resist the pull to new social expectations. This can create jarring and awkward positioning. A lack of diversity, inclusion and equity weaken the brand’s culture, as seen in 2019 with Victoria’s Secret forced to cancel its signature fashion shows. The global brand sold a sexualised fantasy that ignored body diversity and modern ideas. Adapting to change and cultural expectations is a one way to reduce risk of crisis.
4. Digital failure
According to the AusCERT Cyber Security Survey, over 60% of organisations in Australia do not have the resources necessary to respond to cyber security attacks. Data breaches have become frequent in Australia in recent times. Cyber attacks can impact any business or Government as seen with the My Health Record breaches in 2018 and 2019. If confidential documents have been exposed it’s important to understand that the impact goes beyond the organisation and will deeply affect the personal lives of employees, customers and other related stakeholders.
5. Expectations ≠ reality
The failure to deliver on promises is bound to leave an organisation in hot water. Discrepancy between expectation and reality causes stakeholders and the general public to distrust the organisation. In 2019, basketball fans who attended Australia versus team USA were sorely disappointed with seating arrangements at Docklands Stadium. The disconnect between what the event promised and the outcome resulted in an outcry from fans on social media and notably, Russel Crowe.
6. Not tracking the conversation
Companies can walk into a crisis by not listening to key stakeholders. Internally, employee unrest may occur as a result of poor wages and working conditions. Externally, customers may take issue with the quality of a product or service. It’s crucial for an organisation to track and assess the dialogue of all stakeholders and the general public. It’s possible to intervene on an issue before it goes viral. Gaining insight on what people are saying about your organisation and your brand will help build the best strategy to engage with stakeholders.
7. Denial
An estimated 80% of crises can be anticipated and responses planned to deal with them, but a surprising number of businesses don’t have a crisis plan, or if they do never test it. No matter the size of your organisation, having a crisis plan in place will save damage down the track. Never believe your organisation is exempt from a crisis, no matter how confident you are in its operation. Recognising triggers of crisis and being able to confidently apply a crisis plan will limit the temptation to use denial as a response.
‘The seven deadly crisis sins’ is a feature chapter in Icon Reputation’s e-book Surviving Crisis.
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