I often give presentations on the subject “Crisis Management: the Role of Corporate Executives in Managing a Crisis.” Invariably, someone will ask me my opinion on which industry is most prepared to manage a crisis. The answer is difficult, because many companies nip a crisis “in the bud.” Therefore, I wouldn’t know how effectively they would manage a crisis when it becomes “acute.”
I often discuss the Ford Motor Company’s response to the explosion on February 1, 1999. The significant fact is that the executives moved quickly to let the employees know that they cared about the individuals who work for the company. If you remember, William Clay Jr, (Chairman) spent time with ailing workers and with the family of the man who died in the blast. Edsel Ford II, a board member, visited the United Auto Workers Hall to pay his respects.
I suspect that, as an industry, the airline industry has the best prepared crisis management teams (CMT) with documented and tested crisis management plans (CMP).
Let’s look at the recent crash in Taiwan of the Singapore Airlines. During takeoff, Flight SQ006 crashed killing 81 of the 179 people on board. The key steps involved in managing a crisis according to crisis management experts are: 1) take charge quickly, 2) gather the facts, 3) tell your story and 4) fix the problem.
1) - Take charge quickly. Singapore Airlines has been considered one of the safest and best, if not the best, airline in the world. It has never had a fatality in their history. Even so, they still were prepared to respond.
2) - Gather the facts. - Initially the thought was that the weather caused the crash. Then investigators found that the pilot mistakenly took off on a closed runway filled with construction equipment, including digging cranes and concrete blocks. After colliding with objects on the airstrip, the Boeing 747-400 burst into flames and split into three pieces, killing the 81 people.
3) - Tell your story - The chief executive of Singapore Airlines (Cheong Choong Kong) apologized. He said, “They were our pilots. It was our aircraft. The aircraft should not have been on that runway and ... we accept full responsibility. This is a terrible tragedy, and we are deeply sorry.”
4) - Fix the problem - The airline could not do anything about the loss of lives after the accident had happened. But they could help the families with costs that they would incur. The airline offered $25,000 to the families of the deceased and $5,000 to the injured to cover any immediate costs. Then the airline said in a statement, “This is a very sad situation, and the airline hopes to help families through this terrible period by offering compensation without delay.” A day later, the airline offered $400,000 to the families of the deceased. The sum is more than five times the amount the company is required to give in liability cases. [All claims stemming from international air travel are governed by the Warsaw Convention, which imposes a $75,000 per passenger limit on liability. Families can seek more, if the air carrier is engaged in willful misconduct, such as breached security or poor maintenance.] The $400,000 payment is in addition to the earlier compensation.
Post-Crisis Stage - will last for months.

There will be an investigation to determine how the captain, C. K. Foong, missed key warnings, including a routine preflight briefing paper that warned of the hazard on the runway under construction and two large signs that indicated the number of the mistaken runway.
There will be changes to the Taipei airport operations that will allow air traffic controllers to know if a plane enters the wrong runway. Air traffic controllers had no way of knowing the captain turned onto the wrong runway, because an approaching typhoon had made visibility too poor to see the jetliner from the control tower. The airport does not have ground radar that could have detected the mistake. “On a clear day, the tower can see the whole thing,” according to the managing director of Taiwan’s Aviation Safety Council, Kay Yong.
Changes will be made in the operations of planes at Singapore Airlines and at the Taiwan airport. Passengers of Singapore Airlines will have to be assured that pilots have been trained to avoid a repeat of this runway error. Passengers who fly in and out of the Taiwan airport will have to be assured that the airport has taken more steps to ensure that a pilot will not make this mistake again. (The runway strip had not been blocked off, because taxiing aircraft frequently used it. Closing down the entire runway would have created serious delays for planes lining up for departure.) People may lose jobs before the post-crisis stage is over.
The “Crisis Management Plan” is a critical element of the overall Business Continuity Plan. If the Business Continuity Plan’s goals are to minimize the potential for an acute-crisis to occur and to minimize the length of time business functions are disrupted, then the executives of the organization must be prepared to handle the crisis quickly. Many organizations tell me they have documented plans, but they haven’t been tested. It’s important to get the executives of the organization to practice the actions they would take during a crisis. A simulation, built with a strong scenario, should be performed annually. Each year the scenario must change to give the executives a different opportunity to perform their role. Without an initial test of the Crisis Management Plan and on-going annual exercises, the plan will probably result in a poorly managed crisis. Poorly managed crises have caused pain for organizations for years after the crisis occurred. How prepared are your executives to manage a crisis?

Ed Devlin has provided business recovery planning consulting services since 1973 when he co-founded Devlin Associates. Since then, Mr. Devlin has assisted over 300 companies in the writing of their BRP’s and has made over 800 seminars and presentations worldwide.

«BACK to the Articles Index

©Copyright 2000 Systems Support Inc. All rights reserved. Reproduction in whole or in part in any form or medium without the express written permission of System Support Inc. is prohibited.