Crisis prevention: how to do it, how to make it work

[I wanted to posted this article. This is why Treyfish and I are here. We see the early warning signs of a pandemic. The arrows are only pointing in ONE direction, and they haven't changed direction, since I've been doing this, now 3 years, and counting. We are out there everyday, combing the Countries for outbreaks. Until one day, an outbreak will not be able to be contained. I suggest you prepare yourself, your companies, and your communities....We are not getting the appropriate notifications from the World Health Organization, the CDC, Indonesia has not submitted anything to the OIE in years. China, Vietnam, Egypt, India, Indonesia. No one really wants to talk about it, for various political, economical and social reasons. So, we are doing it the hard way, picking thru news sites to find any tidbits we can. Because that is all we got.]

By Len Biegel, president, The Biegel Group, Inc.

Crisis prevention costs little or nothing, yet it is one of the most overlooked steps in crisis management. It can pay big dividends.

With the global financial crisis swirling around us, crisis prevention is more urgent than ever. As the new shock waves unfold about the Madoff meltdown; job losses; and Wall Street abuses, they join the parade of earlier crises, including Hurricane Katrina, the Enron collapse and others. And it is clear they all have one thing in common: EARLY WARNINGS IGNORED.

While each case is unique, there were early warnings which simply were ignored. In the Madoff case, for example, what were the auditors doing? And who were they? And why, as one investor reported, did no one question the murky monthly statements? Or why did no one listen to the Enron whistleblowers? Or the report that warned that New Orleans could not survive a major hurricane the force of Katrina? And the global financial crisis? As the analyses unfold, we will find an array of early warnings ignored, not least of which were those clues lost in the halls of the SEC.

“If only we could have prevented the crisis,” is the cry we often hear.

Well, we can, in many instances, prevent crises.

As we enter what is bound to be a new era of accountability and transparency, it is time to begin the urgent task – for the private sector and for government - of learning how to tune in to early warnings and prevent crises. Surely some crises are already prevented as a result of diligent attention to early warnings. We just don’t even hear of those non-events for they are just that: non-events. And that is the best kind crisis – the one that never occurs. We need more of these!

But what will it take?

It will take a fresh commitment throughout government and the private sector to understand that the pain of hearing and responding to an early warning is far better than the pain of response to a full-blown crisis.

Human nature being what it is, we have, among the business and government leaders, many who look for ways to find a quick ways to make or save a dollar; a disdain for bad news; or an attitude that says ‘if I deny it, it will go away...’ Well, we are in a different world, complicated by globalization and the difficulty of watching over far-flung locations in one company or industry. But we also are in a different world in which it is easier to speak up and be heard with early warnings.

Transparency and accountability and strict and well-financed government regulations are surely going to help. But that is not all. If there is a ray of practical hope, it also rests with the boards of directors of companies and with government oversight committees on the national, state and local levels. If those responsible for private and government governance do their jobs the right way, they will recognize that early warnings are part of their responsibilities. They will learn to ask the right questions. And they will assure that the right procedures are in place to give full attention to early warnings. And to take necessary actions.

Some simple steps:

Commit to listening. Listening is central to spotting early warnings – from customers, employees, suppliers, communities. There is a distinction between hearing and listening. Hearing means you have perceived the sounds or words. Listening, the higher skill, means that you have made an effort to understand and absorb what has been said.

Keep the listening systems simple. High-tech methods can work – especially use-friendly, secure websites. But the old-fashioned suggestion box and slips of paper work well too. Whatever the methods – and organizations often can apply several – everyone should feel that they are being encouraged to suggest, criticize or expose problems.

Ask questions. If there is scant information, probe and find out more. Is this a safe risk? Is this a safe investment? If I am using other people’s money, what if I treated it like my own? Would I do it?

Have a structure in place for checking out the early earnings. Not all early warnings will be significant or even accurate. But you cannot ever know unless you have a system for checking them out and discovering the meaningful ones.

Reward, don’t punish. The employee who saves the day with a winning idea could receive a cash reward – but that is not always necessary. Some organizations reward with a VIP parking spot for a specified time; a long weekend; company products or services, etc.

And finally

Commit to at least one full crisis simulation each year. You will be surprised – among other benefits – that you discover the equivalent of an early warning that can avert a crisis.

Author
Len Biegel is an international crisis management expect, based in Washington DC. His experiences include the landmark Tylenol tampering, and work on 9/11 and hurricane Katrina. He is the author of the 2008 book, ‘Never Say Never: The Complete Executive Guide to Crisis Management’. (Brick Tower Press, NY).