Leading in crisis situation

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LEADING in a crisis situation is very different from doing so in normal conditions. Currently, Zimbabwe is lurching from one crisis to another, including fuel shortages, energy crisis, devaluation of the bond or RTGS currency and price distortions. For many, a leader is there for fire-fighting. In any crisis, leaders are thrust into a stressful and tense environment that puts them under enormous psychological, mental, and physical strain. While many companies might have crisis plans, the myriad and inordinate nature of the crises in Zimbabwe defies any outlined contingencies. The Zimbabwe situation defies any economic logic.

Unanticipated crisis
An unanticipated crisis can easily overwhelm contingency mitigation techniques and risk management programmes, such as business continuity. In business it is the unseen or unanticipated crises that are potentially the most dangerous. The unexpected difficulties or reversals (crunch points) are by far the most overwhelming. However, it is only by facing these challenges that individuals can grow and show what kind of stuff they are made of. The way you handle crises determines your success, health and happiness. The good news is that you can learn to respond to difficulties effectively, which leads to wisdom, maturity and, ultimately, triumph.

Understanding nature of crisis
Crises can be divided into two types: Routine and novel. Routine events are the known risks for which organisations can plan and develop procedures. Examples include safety plans for manufacturers, recall plans for food companies and liquidity plans for financial institutions, as well as disaster recovery and security plans for companies across industries.

Novel crises are those risks that exhibit unusual frequency and impact. Organisations typically do not have plans for such events. Novel crises may be a confluence of two or three events that strike at the same time, or they may simply be too big or unusual to be imagined. This is the type of crisis currently hitting the Zimbabwe business sector. In the absence of pre-determined procedures, novel crises — whether they are natural disasters or economic problems, terror attacks, cyber breaches or malevolence such as shootings or inside sabotage and fraud — can test leadership’s decision-making and strategic-thinking abilities.

Managing the unexpected
A crisis puts to the test the decision-making skills of an organisation’s management and employees. If you are too quick to make a decision, you might be basing the decision on incorrect or inadequate information; by the same token, waiting for the perfect set of data can lead to analysis paralysis and slow decision-making or no decisions being made at all.

Leading decisively
The CEO may not always be the ideal choice to lead a response to an unexpected or unusual crisis as it could distract him or her from the day-to-day business and other important matters. In a crisis, other C-level executives, such as the chief operations officer, chief risk officer, chief legal officer in the case of a major legal challenge, can step forward to lend support, as can an outside crisis expert. Effective turnarounds are not made out of micro-incrementalism, but of very bold and decisive acts. However, it is not uncommon to make mistakes, so it is important to be flexible and back up, change course, adjust and go forward again.

Continuous crisis framing
Rather than holding fast to the first impression and analysis of the crisis, be flexible to embrace new information as it comes along. If new analysis suggests a remake of the original plan, remake the plan. One of the most important things for any crisis leader is to identify what the crisis is and to constantly re-evaluate the situation every couple of hours, days and weeks because crises can change and they can become multiple events. What you thought was unimportant yesterday can become extremely important tomorrow. In today’s age of social media and 24/7 press coverage, some things can become much more in a crisis than originally expected. Continually framing the crisis and having the ability to assess on a continuous basis is extremely effective in managing any crisis.

Actively communicate
During a crisis, it is important to constantly communicate to lenders, owners, employees, vendors, and the public through the media. Control the message by designating a crisis manager to be the sole spokesperson and to be the source of honest and consistent information. It is also critical to keep a record of the facts that the crisis manager knows at each point of the process in order to respond to potential lawsuits that may arise. It is extremely important to actively communicate up and down in an organisation, as well as to customers, clients and employees. Honesty and transparency are critical. Stay calm. Take a deep breath and refuse to become upset or angry. Lower your emotional flashpoint by asking questions, listening carefully, and thinking only about possible solutions.

Be ready for the unexpected
Under extreme pressure, leaders should understand that individuals may act differently than during normal circumstances, and that the usual organisational roles may not apply during a crisis. This can further add to the unpredictability of a critical event. To counteract that, any one manager should have limitations and should not be the only one to deal with a crisis. In advance, plot out when and how external parties might be brought in to help address the crisis. Be confident in your abilities. Remind yourself: You have handled all kinds of difficulties in the past, and you can handle this problem as well. Dare to go forward. Unexpected reversals and setbacks often stun you into a form of paralysis. Do not give in to these feelings. Instead, think of specific actions you can take immediately to remedy the situation.

Drive toward actionable intelligence
In the midst of a crisis, leadership must often navigate confusing data and intelligence. It is important, therefore, to cast a wide net, as crucial information can come from a range of sources, including customers and employees.

Robert Mandeya is an executive leadership coach, trainer in human capital development and corporate education, a certified leadership and professional development practitioner and founder of the Institute of Leadership, Research and Development (LiRD). — robert@lird.co.zw/www.lird.co.zw.

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