Crisis Management Plan Template

The Importance of Crisis Management Plan

Bolstering a company’s ability to generate income is understandably at the top of most organizations’ priority lists. The problem with this prevalent model, however, is that crisis management plans are not given the attention they deserve; this could lead to avoidable losses that could easily be prevented by good crisis management planning and implementation.

Good crisis management planning and implementation help organizations:

• minimize total losses and damage to the organization and its employees in the event of a crisis;
• avoid legal issues since local authorities often mandate crisis management plans for certain crises and non-compliance can lead to fines and penalties; and
• prevent a complete operational shutdown.

Crisis Management Planning: Types of Crisis

While it is impossible to predict every crisis scenario, that does not mean that organizations can do nothing to prepare for them. Crises can be listed under the following general categories to help organizations come up with risk management plans to minimize, if not eliminate their chances of occurrence:

Financial Crisis

This refers to instances where a company’s assets and earnings are unable to cover its operational costs and associated debts. The emergence of new competition, poor investment decisions, and mismanagement of financial resources are all potential causes of a financial crisis.

PR Crisis

A public relations crisis refers to events that threaten to damage your brand’s reputation. A design flaw that caused a severe injury or fatality, news and accusations of employee maltreatment, and contaminated food and beverage products can potentially spark a PR crisis, possibly alienating customers, investors, and other stakeholders in the fallout.

Natural Crisis

A natural crisis talks about completely unavoidable events, simply because they are acts of nature. Natural catastrophes such as hurricanes, earthquakes, tsunamis, and the COVID-19 pandemic all fall under this category.

Organizational Crisis

This type of crisis talks about internal conflicts that interfere with the efficient operation and achievement of company goals. Minor disagreements and misunderstandings between teams and colleagues from time to time are perfectly normal. However, if goals and deadlines are missed regularly, managers may need to investigate if the organizational structure and internal processes are at fault so corrective measures can be applied

How Does Crisis Management Work?

There is no such thing as an all-encompassing crisis management plan. Often, organizations need to create several crisis management plans tailored to address the different natures of possible crises.

The first step to having an effective crisis management initiative is to form your organization’s own crisis management team.

Crisis Management Team: Responsibilities and Skills

The basic responsibilities of a crisis management committee or a crisis management team are identifying crisis scenarios, identifying the resources needed to mitigate them, and coming up with the right countermeasures to minimize their negative impact.

Additional skills and responsibilities include:

• A good understanding of the operation’s nature to quickly identify threats that could emerge considering organizational and economic factors among others.
• An inclination towards proactive research to stay on top of industry updates.
• A knack for data analysis; the ability to interpret complex data and explain them in a simple manner.

Creating a Crisis Management Team

The roles and responsibilities of the crisis management team, often abbreviated as CMT, may vary depending on the organization’s nature, legal obligations, and preference. Generally, however, the following roles or variations of them are present:

Team Leader
Acting as the “general of the war room”, the crisis management team leader takes command in crises and often gets the final say on what should be done. The team leader doesn’t necessarily have to be the CEO. The role is typically granted to managers with proven leadership skills.

Secretary
The secretary takes the role of the scribe. This person ensures that all meetings and discussion points are documented for later reference. The secretary’s role is crucial to determining whether progress is being made on crisis management initiatives and plans.

Communications Coordinator
The communications coordinator is responsible for keeping stakeholders informed regarding the crisis, and what the company is doing about it. Internal communications are sent out to other departments within the organization, typically providing assurance as well as official advisories if the team requires the cooperation of other departments. External communications cover clients and customers where the company provides updates on how the crisis affects ongoing deals and whether or not delays on deliverables may be expected.

Finance Officer
The finance officer is tasked with managing the budget for crisis management initiatives, as well as ensuring that the company’s funds are used economically especially during a financial crisis. This person is trusted to coordinate with department heads to make sure that corporate spending is reserved for the most essential functions when a crisis affects the organization’s financial resources.

HR Representative
The human resources representative is tasked with ensuring that employees receive the support they need during and after crises. Their responsibilities include temporary staffing, employee communications, and developing employee assistance initiatives.

IT Consultant
The IT consultant’s job is to provide knowledge and insights during crises that involve the function and safety of internal computer systems either directly or indirectly. Often the head of the IT department, this person is also in charge of developing and implementing contingency plans for crises that could affect internal data safety and computer systems functionality.

Legal Advisor
The legal advisor oversees crisis management initiatives and is tasked with ensuring that all proposals, from development to implementation, comply with the organization’s legal obligations and do not violate regulations and government mandates.

Steps for Crisis Management

When designing an organization’s crisis management plan, crisis management team leaders must start by orienting the team on the three steps to solving a business crisis:

Containment
Once the crisis has occurred, the priority is to ensure that damage is contained to its epicenter. This step aims to lower the risk of further aggravating the situation by implementing controls to keep the problem localized. The smaller the fire, the easier it will be to put out.

Management
After containing the crisis, and before a definite resolution becomes available, the priority shifts to managing the problem. Aside from vigilant monitoring to ensure that containment measures are not breached, the management stage attempts to maintain the “new normal”; implementing controls to prevent the situation from further escalating while finding ways for the company to operate at a reasonable level if at all possible.

Resolution
The culmination of a crisis management plan, a complete resolution often takes more time, energy, and resources to create and implement compared to containment and management initiatives. This is why a crisis management team is composed of personnel with different backgrounds and expertise; it allows the team to have a holistic understanding of the crisis and the different routes they can take to resolve it.

Designing a Crisis Management Plan

Considering the complex nature of business in general, and adding further complications introduced by the many different types of crisis that can befall an organization, one might assume that complex crisis management plans are a good thing. After all, complex problems require complex solutions, right? Not necessarily.

Though it may initially sound counterintuitive, the management plans need to be as simple as possible. After all, they are implemented not only by the core members of the crisis management team but also by the different departments and personnel the crisis affects. When a crisis occurs, the speed at which crisis management plans are implemented can mean the difference between failure and success. Crisis management plans should be simple enough so that people who have never read them can easily comprehend and implement them on short notice.

Below are some of the ways you can simplify your crisis management plan and ensure that it works:

Start with an organizational guide map
A guide map outlines the organization’s departments, their functions, and breaks them down per role and responsibility. Having a clear guide map is important since it makes cooperation between teams easier by promoting accountability and ensuring everyone knows who’s responsible for what. If your company already has a guide map, ensure that it is updated before using it for your crisis management plan.

Include a process flowchart
To make your plan easy to implement, make sure to include a process flowchart. Having your recommendations laid out in a chronological sequence with if/then scenarios can be the simplest way to make personnel comprehend and implement your crisis management plan right away.

Create an adaptable design
For crisis management plans to stay effective, they need to stay updated. Several factors including a change in the organizational structure, service, or process, not to mention external elements beyond the company’s control, can affect the relevance and potency of crisis management plans. For this reason, crisis management plans need to be adaptable.

Often, only certain parts of the plan would need to be updated. To accommodate this, create a modular design. This allows certain processes and policies within the crisis management plan to be updated as individual units; making updates easier and faster.

Crisis Management Plan Example

To give you an idea of what a crisis management plan should look like, we’ve created a simple design.

Preview Crisis Management Plan Example PDF

In this sample crisis management example, contains 3 main sections which are:

• Scope of Crisis Management Plan – As its name suggests, this section provides the specific crisis that the plan is trying to manage. (e.g., earthquake, tornado, COVID-19, typhoon, etc.)
• Communication Response – In this section, personnel of contact in case of an incident or emergency is listed down by order of priority. This person may be a key official, legal counsel, or advisors. It is essential that this section be able to provide the personnel’s full name, position title, and their contact number.
• Action Plans – This section contains instructions for the containment and management of the said crisis mentioned in the plan. The emergency protocols provided in this section have been carefully thought and put together by the crisis management team. It is expected to be carried out should the crisis arise, to prevent the situation from further escalating.
• Sign off – Lastly, a crisis management plan should be validated by the crisis management director or other relevant stakeholders with a signature to officiate the information and guidance provided.

Essential Elements to Include in Your Crisis Management Plan

While the contents of crisis management plans may vary, there is certain information considered standard and relevant to all crisis management initiatives. Below are some of the fundamental elements that should be present in the plan:

Conditions for Activation
It is important to note that not all incidents necessitate the activation of a crisis management plan. Crisis management plans should only be activated when a full-fledged crisis occurs. To distinguish an incident from a crisis, clear parameters must be set. When enough crisis conditions are met, only then should crisis management plans be rolled out and implemented.

Links to Supplementary Documents and Information
Crisis management plans are only effective if implemented on time. They are also largely digital nowadays, which means that important supplementary documents and information can be accessed quickly with the help of hyperlinks. Take advantage of technology and include hyperlinks to essential documents and information to speed up and streamline crisis management plan implementation.

Contact Information
Some instances may necessitate contacting a member of the crisis management team or other key personnel amidst an ongoing crisis. Unclear and insufficient instructions could be one, and an escalating crisis that exceeds the controls set by the crisis management plan is another. Regardless of the reason, it is important to always include the contact information of the crisis management team and other key personnel to ensure that clarifications and necessary adjustments to the plan are done on time.

Post-crisis Management Plans
After putting your crisis management plan to work, have a post-crisis management plan to document its application and review real-life implications. This can help your team identify its weaknesses so you can come up with the necessary adjustments for greater efficiency and effectiveness in future uses.

Crisis Management Plan: Do’s, Don’ts, and Whys

Not all crisis management plans are created equal. Though details may vary depending on the preferences, capabilities, and resources of each organization, the following items are worth noting when creating your organization’s crisis management plan:

Do – Prioritize Worker Safety
Productivity and safety are both pillars of a successful organization. However, when a crisis hits and the safety of your employees risk getting compromised, a good organization would be willing to let productivity suffer in its stead.

Don’t – Insist on BAU When Safety Risk is High
When COVID 19 became worldwide news, but before government-mandated quarantines and lockdowns were put in place, some companies were quick to make flexible working arrangements for their employees to minimize the chances of viral infection. Even though some organizational functions may be compromised by the new set-up, these proactive organizations chose the lesser of two evils by putting the safety of their employees first.

Do – Be Honest With Your Employees
When a crisis arises, employers would do well to honestly communicate the situation to their employees clearly and effectively instead of trying to cover it up. Employees want to be trusted by their supervisors and managers and often feel like they should be privy to the details of an organizational crisis especially if it could end up directly affecting them. When it’s clear that the organization trusts its employees by being honest especially in crises, employees often pay that trust back which translates to performing their work at a higher level.

Don’t – Leave Details Vague and Let Employees Speculate
Organizations that choose to keep crisis details vague, if not completely hidden from their employees, leave room for speculation. Speculation erodes trust between the organization and its employees since it almost always reflects badly on the company. A good organization understands the need to keep employees in the loop to dispel malicious rumors before they start brewing, and be open about the legitimate problems the organization is currently facing to maintain trust, and open the possibility for cooperation.

Do – Communicate With Customers and Stakeholders
Whether your organization is facing an isolated crisis or a global crisis that the entire world is dealing with, your customers and stakeholders expect your assurance through clear and honest communication. You will need to be open about the situation, what is being done to manage it, including the necessary adjustments concerning commitments to both customers and stakeholders. This gives them peace of mind by knowing that you have not forgotten your responsibility and that you still intend to do your part in the midst of the crisis.

Don’t – Assume That a Crisis is Unlikely
A mistake that most companies tend to make is to forego the creation of crisis management plans and focusing entirely on growth. Assuming that a crisis is unlikely can be a fatal mistake. The COVID 19 pandemic took its toll on several businesses, revealing just how unprepared most organizations are in the face of a sudden impactful crisis.

Testing Your Crisis Management Plan

Some things work well in theory but not in practice. Preferably, your crisis management plan is not one of these things. The second worst thing that could happen after a crisis befalls your company is finding out that your crisis management plan does not work as it should.

Fortunately, this can be avoided by running simulations to ensure the functionality of your crisis management plan. Simulations are useful in helping teams identify the weaknesses of a crisis management plan as it provides a safe environment for testing that involves none of the real-life consequences of implementation.

Here’s how you and your team can prepare, run, and evaluate the effectiveness of a crisis management simulation:

Enumerate the benefits you expect to gain from the simulation
To measure the impact and effectiveness of your crisis management simulation, you first need to know what you want to get out of it. Start with simple, measurable goals such as checking plan viability against the current state of the company, and identifying inefficient protocols for later revision.

Decide on a sample crisis scenario
Brainstorm with the CMT to discuss and decide on a crisis scenario that makes sense for your company. Crisis scenarios can vary greatly depending on several factors. The nature of your business, the size of your operation, the country in which you operate, and even your company’s plans can affect which crisis scenarios you are more likely to encounter.

Outside of company-specific factors, elements outside of your control such as natural disasters and economic recessions are general crisis scenarios that can hit any business at any time. As such, it would make sense to create separate crisis management plans to address them.

Below are a few crisis scenarios you can use to test your crisis management plan:

• Natural calamities such as hurricanes, earthquakes, etc.
• Cyber attacks from hackers
• Internal sabotage and criminal behavior such as stealing, damaging, and sharing sensitive company data

Run your management plan simulation
While running your crisis management simulation, you need to be vigilant in ensuring that it stays as authentic as possible so you can get real insights. This includes noting what information is available to your team during the hypothetical scenario, and when they become available.

While the simulation must be taken seriously, the daily work activities of CMT members must not be neglected for its sake. Inversely, the supervisors and managers of CMT members are encouraged to give them leeway so they can dedicate ample time and effort to the simulation while still contributing to their respective departments.

Evaluate the results and gather insights
The most important stage of a crisis management simulation is the aftermath. This is where the crisis management team comes together to discuss what happened during the simulation to extract valuable insights.

Were protocols clearly worded, allowing personnel who have no prior experience with the crisis management plan to follow them without confusion? Were proposed initiatives as effective in practice as they were in theory? Do we have the proper resources to implement the crisis management plan as designed? These are common questions CMTs can answer to find and address weaknesses in a crisis management plan.

Beyond Crisis Management

While crisis management plans are mainly concerned with minimizing the damage brought upon by unforeseen events, risk management plans create measures to avoid such events from happening in the first place. If the risk management plan fails to contain an issue, the crisis management plan steps in to lessen the negative impact on the company. Finally, a business continuity plan outlines the actions the organization will take to ensure that the company remains operational through the systematic utility of its remaining resources until the status quo is reestablished.

Crisis Management Plan Maintenance

A crisis management plan is only effective if it is updated. It is not uncommon for organizations to forget or put off CMP reviews when they are caught up in pursuing business growth and managing day-to-day operations. In some instances, they simply do not think it is worth their time and effort. This attitude, however, puts their company in a vulnerable position should a crisis happen.

Here are a few tips your crisis management team may find useful when ensuring the relevance and currency of your  plan:

Schedule regular and have ad hoc CMP reviews
A good organization should schedule CMP reviews at least once every three months. Though intervals may vary per company depending on their preference and obligations as a business, reviewing your CMP once every quarter is generally considered to be good practice.

Assign a point person to monitor relevant internal and external updates
CMPs must also be reviewed when major organizational changes, and relevant internal and external events or factors are introduced at any point.

After Crisis Management: Business Continuity Planning

While some of their elements may overlap, the core purpose of a Crisis Management Plan differs significantly from a business continuity plan.

The management plans, first and foremost, are designed to mitigate the negative effects of an ongoing crisis as quickly as possible. A business continuity plan, on the other hand, focuses on sustaining the most critical business functions to ensure that the company continues to operate despite an ongoing crisis. A business continuity plan needs to be adaptable to help businesses navigate and survive natural disasters, power outages, and other operational hindrances.

Having a solid crisis management plan for each likely, and some unlikely crisis scenario can help prepare your company to handle the eventual fallout. Regardless of your company’s nature, size, and available resources, investing a decent amount of time and effort in crisis management plans can pay dividends in the future.