Dick Fuld, the former CEO of Lehman Brothers, would probably agree with the statement that the Great Recession of 2008 was a crisis. Many people, however, would offer different opinions of who or what caused it. Without question, however, Lehman Brothers was a key player in the meltdown.
Fuld, in many respects, was at the center of the financial debacle.
As a leader in your business, one factor to consider when dealing with a crisis is determining the level of crisis you have to address. Is it the level of magnitude that resulted in the Great Recession or is it something that is still distressing, but is limited in scope to your company only? While there is certainly a huge degree of difference in the above spectrum of possibilities, there are still several considerations that you should take into account for a crisis situation.
John Baldoni, a crisis leadership consultant and a writer for the Harvard Business Review, indicates there are at least five issues that you should consider when you are faced with your next crisis.
Step Back and Assess the Situation – Depending upon how close you are to the situation, you will no doubt go into a crisis more objectively then when you come out of it. Therefore, if you can possibly take a moment before you jump into the fray and assess the situation, it might be of significant help to you and your company. You should also realize, in some very personal situations, someone else might be better suited than you, to assume the crisis leadership role.
Be Timely in your Response, DO NOT PANIC – The more hurried you are, the more nervous people will get. Strive to be responsive and timely, yet deliberate in your dealings.
Determine the Outcome and Manage to It – This issue could appear to be silly, but it can be truly relevant when things are put into perspective: How long do you anticipate the crisis to last? If you know it will take at least six months to resolve, then DO NOT attempt to solve it in six hours. How do you want to see the issue or outcome reconciled? Can it be managed to an outcome that is acceptable or not? If it can be managed, then your outcome is within reach. If it cannot be managed, then you will at least go into the fray knowing there might be some damage control required at the end of the day.
Maintain Control – Keeping control in a crisis situation is easy to say and certainly not something that is easy to do, by any stretch of the imagination. While you may not have been able to avert the disaster, you can most definitely step in and try to obtain, then maintain control.
Keep your Composure – Maintain your cool, at all costs and at all times. An owner or leader who flies off the handle in a crisis situation is worthless to their company and their employees. Strive to stay positive and act mature. If you do, others will have a tendency to do the same. If you lose your cool, others will have a greater tendency to lose theirs.
Remember that most crises evolve. The strategy and tactics you initially employed at the beginning, may not be the ones you have implemented at the end. Be flexible enough to know that you might have to adapt and change direction ‘on the fly.’
Baldoni is very clear when he indicates that "leaders have another important role during a crisis and that is to provide perspective." Many times the most effective leaders in a time of crisis are more successful if they can "stand back from the action." As a leader in your business, staying objective can be a significant difference maker.
If you get into the ‘pit’ of negativism with your critics, then an argument can be easily made that you, or your company, are no better than your critics. How would you feel about that? If you have a condescending attitude in your responses, it is doubtful you will come out of the crisis in a good way. Stay positive.
While it is quite probable that none of us will be involved in crisis leadership at the level of magnitude as the 2008 recession, we will probably be faced with the prospect of some form or type of business crisis in our careers. Hopefully, we can bring our company through the crisis unscathed.
Dan Arens is an Indiana-based business growth advisor.