Crisis management is relatively a recent discovery in management arena. Crisis management is a wonderful tool in the hands of management. It fulfills the function of anticipating and forecasting crisis and the methods to deal with them. It prepares an organization in dealing with unexpected crisis situation. It is also instrumental in assisting organizations to categorize the nature and cause of the crisis, take preventive measures, curtail damages and finally convalesce as fast as possible.
Crisis is basically an unpredictable event which can cause damage to the organization. The damage can be in form of monetary, perceptual or natural. In case of natural crisis, it can occur in form of fire, some natural disaster, earthquake, explosions or violence among others. This is also called as sudden crisis. In the event of sudden crisis, management focuses more on ensuring minimal damages and speedy recovery.
Crisis management is more focused towards damages caused to the image of the organizations. Often termed as perceptual crisis, this can be the worst form of crisis for any business. In this case, management tackles the situations on various levels. The lead role is taken by the PR department. It concentrates on rebuilding the brand image by assuring the public of the products quality and consequent services. Crisis management also involves, preparing crisis contingency plans, providing accurate information to the media, public and shareholders apart from making fast moves for better long term results.
Like for example, it has been seen that often automobile majors have been forced to withdraw their vehicles from all over the world because of malfunction of certain engine parts. While doing this, the company image takes a huge beating not to forget the legal, political, environmental and financial implications. Thereafter, it demands a huge exercise from the crisis management team of the company to rebuild the brand image or else the company runs the risk of losing its credibility. The complete build up towards contingency plan is difficult but forecasting crisis and being prepared for it with valid solutions helps a lot in the long run.