Wednesday, April 8, 2009

Three most critical things a leader should do during corporate crisis

I think three most crtical outcomes of a corporate crisis are 
  1. Possible Financial loss
  2. Loss of client confidence and 
  3. Negative Sentiment among employees 
Thus a good leader should address these theree issues. 
  1. Possible Financial loss: Discussion with important people in accounts and business development teams in order to arrive at numbers and mutually agreeable contigency plan. This should help in being prepared for the crisis outcomes in more tangible terms. 
  2. Loss of client confidence: The leader with immediate effect should converse personally with all important client (if possible all clients) and explain the true nature of the crisis and the possible steps that would be taken in order to negate the impact of the crisis. This has to be done even before formulating the plan of action to tackle the crisis. This conversation should contain the inputs from senior management meeting held in the company. More crucial thing here is honest representation of facts and intent. This probably help build lot of trust. This may be of help where the project agreement/order closing is in its final stages. 
  3. Negative Sentiment among employees: Depending upon the size of the organization there may be varied impact of employee morale on the organization. Most times multiple rumours worsen the situation. Thus it is advisable to take confidence building measures. This is similar to the efforts taken for restoring client confidence. However the content or the mode of delivery may differ.

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