Chief executives, managing directors and other senior business leaders are failing to take crisis preparedness seriously and risk undermining their organisation’s ability to manage crises, according to a crisis management survey.
The survey by Regester Larkin and Steelhenge of 170 large companies from 27 countries revealed that while big business now understands the need to prepare for a crisis (86 per cent have a crisis management plan and 59pc carry out crisis training at least annually), too often its senior leaders do not participate in this specialist training or crisis exercises. Some two-thirds, 68pc of companies quizzed had run crisis exercises in the past year, but in about half of cases chief executives (45pc), and legal and finance heads (51pc) had not taken part. Respondents identified senior management buy-in (46pc) was the single biggest challenge of effective crisis preparedness.
Failing to learn
The survey also found that organisations are failing to learn from experiences. Only 40pc of those companies that had responded to crises in the last year said that they review their crisis plans after an incident or issue. After real crises, plans should be reviewed and improved where necessary. This window of opportunity, when crisis management is high on an organisation’s radar, should be taken to ensure any mistakes are not made again.
Partners and suppliers
The survey also found that organisations are not involving their key value chain partners in crisis preparedness programmes: only 27pc involve them in crisis exercises despite over a third (34pc) saying that working with partners in a crisis was likely to be a big challenge. Crises do not occur in a vacuum, the report authors point out. Organisations can find themselves in the middle of a crisis because of its partners’ or suppliers’ behaviour. Without involving them in their crisis preparedness, companies leave themselves vulnerable to being truly crisis ready.
Dominic Cockram, Steelhenge managing director and Regester Larkin director said: “If leaders are not fully brought into crisis preparedness, any good work put into crisis structure, process and capability building will be critically undermined. There is little point attempting to be ‘crisis ready’ when the core individuals responsible for managing a crisis will not know what to do. There may be many reasons why chief executives aren’t able to attend crisis exercises but if you ask any business leader after a real incident or issue, they will tell you it was good time spent.”
About the report
The report is based on 170 responses from a survey in June 2015. Respondents were asked about their approach to crisis management and were from large complex organisations (99 had more than 5,000 employees), from 27 countries. They represented a range of sectors and functions. A copy of the report can be downloaded here: http://www.regesterlarkin.com/request-crisis-management-insights-report/.
