You’re sound asleep when your phone starts ringing. In fact, every electronic device starts to ping wildly. You find out your most important client has had a major chemical explosion. It could be the beginning of the worst business day of your life, or it could be a manageable series of events.

Crisis management, disaster recovery, damage control – these are terms that have been in use for decades. But in recent years, their meaning and requirements have changed dramatically. Where once businesses felt comfortable that having offsite data backup was all they needed, today they are putting experts on staff and establishing top-to-bottom procedures to minimize damage to the company and its reputation. In fact, in some industries, presenting a comprehensive crisis management program has become part of the lending process.

If you haven’t done your crisis homework yet, start today. There are three major ways to approach the issue:

Crisis Prevention –- It’s always best to stop a crisis from happening if it can be done. A vulnerability audit is one method of finding out where identifiable weaknesses exist – whether in physical plants, service centers, programming, and the like. Few companies can run this kind of audit effectively by themselves, which is why outside advisors need to be retained just for this purpose. The right advisors can facilitate the conversations that no one in the company wants to bring up – yet they’re often the very issues that cause companies to falter later.

Crisis Team –- Who is part of the team, how their roles are defined, and how they interact with each other are more important than taking the top ten people on the corporate list of officers. Some of these will be internal and could even be middle management, such as a risk officer for retail stores or a plant manager for manufacturing. Unfortunately, the larger the organization, the more everyone wants to be involved. Your team won’t work if it’s too large. For criteria, consider:

• Who is essential to the company’s survival?
• Who is essential in the event of a financial crisis?
• Who is essential in the event of a security crisis?
• Who is essential in the event of a production or manufacturing crisis?

There will be some natural overlap on each of these – those are your team members. Don’t forget the outside advisors as well in legal, finance, and communications.

It’s not enough to establish a team if the team never meets. Annual programs (semi-annual if they can be done) should be created with a variety of crisis scenarios to see how each member of the team manages his/her responsibilities. Use your outside communications advisor to set up the crises and facilitate the training. This kind of attention proves far more effective than crisis manuals in helping the team clarify how to work together. Manuals still have their use – mostly in helping the team focus on all the stakeholders who could be affected, and anticipating their needs. But when the crunch happens, most people neglect the notebook.

Mid-Crisis Damage Control -- We’re back to your worst morning. It CAN happen despite everyone’s best efforts. Where do you start?

Getting the team moving –  Every team member should have 24/7 contact information at all times. That means an electronic format and even a reimbursed card (the size of a credit card) that each team member carries at all times. Some companies have established satellite phones to ensure contact is possible regardless of what systems may go down. Check with your insurance provider as well – they often carry certain vetted advisors on board and can make viable recommendations that will provide the right service at the right price to augment your company’s internal resources.

Defining actions -- The team’s first action is information gathering. You can’t move forward without as many facts as possible. As one crisis expert* said recently, “Fast is better than slow, but slow is better than wrong.” What you need to do will depend on determining who matters most during the specific crisis**. If it’s the customer who matters, then don’t spin your wheels putting out media fires.  If your customers make or break your company, they should be the stakeholders at the top of the list.

Throwing the CEO out in front  -– Conventional wisdom says that a CEO should get out in front of the cameras as soon as possible for transparency and leadership. Sometimes that’s the worst step a company can take – there’s not enough information, the CEO needs to be working where he/she is needed most, and that may be not be working the media. And some CEOs simply create poor media impressions. Use your best resources where they’re needed most.

Getting out of the way –- Day two can be as difficult as day one, or it can be the start of a new direction based on the steps you have already taken. If a different but viable flow of action can be instigated, then the best next-step is to get out of the way. Let the process work instead of over-controlling it. The stakeholders will move the mission forward, whether that mission is getting a production line back on track, serving customers, or meeting with investors.
 
Finally, no matter what you plan, that bad day is still slated for your future. How bad it will be depends on how well you know what and who really matter in your or your client’s organization. Determine your best resources, and put them to use immediately. Then go get a good night’s sleep.

*James B. Moorhead, litigation partner, Steptoe & Johnson LLP

**Ian D. Campbell, vice chairman, Abernathy MacGregor