CRISIS MANAGEMENT: ITS SCOPE AND THE IMPORTANCE OF LAWYERS IN CRISIS MANAGEMENT.
By: PETER UMAH Esq
INTRODUCTION
In our contemporary world, so much so in the 21st century, crisis management is critical and very fundamental for any and every business organization. The importance of crisis management cannot be over emphasized as it helps to ensure that the organisation can survive and thrive during a crisis event. Crises can take many forms, including natural disasters, cyber-attacks,[1] financial meltdowns, and product recalls, among others.
It suffices to categorically state, that an organisation or business without a well-structured crisis management plan may, when crisis comes, be unable to recuperate and continue its business. Having said this, the adverse effect of crisis, ranges from financial losses, damaged reputation and in most cases, potential legal actions, which a lawyer must be called upon to proffer solutions.
- WHAT IS CRISIS MANAGEMENT?
Crisis management is the application of strategically designed measures to assist an organization deal with a sudden and heinous negative event, while still maintaining business continuity. Crisis management involves the making of and implementation of policies and procedures to defend, mitigate and prevent a crisis[2].
Crisis management is also the systematic way of setting in place plans, structures, measures and policies in other to prevent, cure and exit challenges which may pose short or long term business threat to an organisation or business. Crisis management involves analysing and managing potential major problems that can threaten the existence of an organization or business.
3.0 THE SCOPE OF CRISIS MANAGEMENT
Effective crisis management programs strive to prevent crisis from occurring in the first place. They also guide quick and decisive responses designed to restore trust and resume operations in the event a crisis occurs.[3] While some crisis can be prevented, others cannot. Having preparedness programs and systems for quick and effective response to crisis events, makes all the difference between chaos and a managed response with mitigated loss[4].
3.1 Many companies tend to effectively find out the potential threat or negativity that may occur to the organization in the future. These businesses or organizations do their best to avoid these threats as much as they can or when the threats occur, they do their best to turn the negativity into positivity for the organization.
Generally, the scope of crisis management is centred on just one thing – to plan[5]. It is imperative that every organization has a suitable crisis management plan. Without a proper plan, then the management of the crisis will not be a success.
Therefore, the first necessary thing to perform as part of crisis management is to create the crisis management plan. Normally, according to the nature of crisis to be encountered, there are several plans to apply such as a pre-crisis plan, a crisis plan and a post-crisis plan.
4. 0 WHO IS RESPONSIBLE FOR CRISIS MANAGEMENT?
For every organization or business, there are different strokes for different folks. What may be attainable here may not be attainable in another organization as per the modus of managing crisis.
There is usually a team set up for the purposes of crisis management in every organization. This team comprises executive members, risk assessment officers, members of staff and most importantly, lawyers from the legal department.
There are key factors which must be present towards attaining success in crisis management. This key factor is the need to have lawyers in your team; a lawyer should, as a matter of necessity, be a part of that team because there are advice only lawyers can proffer which can help in pre-crisis, crisis and post crisis era.
5.0 ROLES OF LAWYERS IN CRISIS MANAGEMENT
Lawyers in an organization or those retained by organizations, bear important responsibility for ensuring that an organization is prepared, and aware of any potential threat or crisis. Lawyers should, after preparing other team members, be ready to take up the lead role during crisis.
The lawyers’ role can be grouped into:
- Pre- crisis Phase
The issues always surrounding a crisis will naturally include but not limited to duty of care to a neighbour, financial cost and a variety of regulatory and compliance issues. Many of these issues stem from legal obligations; all represent substantial legal liability and reputational exposure. It is the duty of lawyers to appreciate them, anticipate them and understand how to address them. When this is not done, crisis preparedness and the resulting response may be severely compromised[6]
Here the lawyers are very much needed to give legal advice which will help in wise policing making by the organization. The roles always include making sure that organization complies with all regulatory bodies and extant laws. This is most applicable for start-up companies
- Crisis Phase
In this stage, the lawyers play a central role. They are not in the forefront in this phase. There is a need to understand that the appropriate response to a crisis requires the right blend of skills and actions and competence at the right times. That means, lawyers must work hand in hand with experts in crisis management, crisis communication, and other disciplines in other to detect the seriousness of the crisis and what needs to be done to savage the situation at the very moment. They must work hand in hand with the communication team to put out a valid legal solution internally or even to the public. They also are responsible for analysing the extent to which the crisis has affected the organization, the legal remedies or legal wrongs facing the company and a way forward.
- Post Crisis Stage
The lawyers here, advice the organization on the need to comply on the non-compliance that brought about the crisis initially and advise them appropriately on subsequent compliance in other not to repeat such mistake. It is the role and duty of lawyers to always keep the company updated on new laws in other to foil further liability or crisis.
Conclusion
The need for crisis management cannot be overemphasized. Crisis are inevitable, therefore, the ability and how well it is prepared for is what makes an organization stand out in this business. Where an organization fails and crumbles in the face of crisis and adversity, it only goes to show that the strength of that organization is weak. In-house lawyers or lawyers on external retainership must hone their crisis managerial skills to be able to stand in for the organization where necessary.
References:
- Regester, M., & Larkin, J. (2005). Risk issues and crisis management: A casebook of best practice. Sterling, VA: Kogan Page US.
- Crisis Management: From Policy to Response (Dentons Canada LLP and ACC Canada Mar. 2014), http://www.acc.com/chapters/canada/up load/Crisis-Management-From-Policy-toResponse-March-2014-3-copy.pdf
- Institute of Business Continuity Management, Organisation Resilience: Business Continuity, Incident and Corporate Crisis Management, https://www.continuitycentral.com/Organis ationResilience.pdf (includes extensive bibliography and reading list)
- Crisis Management: What to Do When a Company/Brand-Threatening Event Occurs, (Europe source) http://www.acc.com/legalresources/resour ce.cfm?show=20231
- https://www.theirm.org/news/3-cyber-risks-to-look-out-for-in-2023/
- https://www.techtarget.com/whatis/definition/crisis-management
[1] https://www.theirm.org/news/3-cyber-risks-to-look-out-for-in-2023/
[2] https://www.techtarget.com/whatis/definition/crisis-management
[3] Crisis Management: From Policy to Response (Dentons Canada LLP and ACC Canada Mar. 2014), http://www.acc.com/chapters/canada/up load/Crisis-Management-From-Policy-toResponse-March-2014-3-copy.pdf
[4] Institute of Business Continuity Management, Organisation Resilience: Business Continuity, Incident and Corporate Crisis Management, https://www.continuitycentral.com/Organis ationResilience.pdf (includes extensive bibliography and reading list)
[5] Crisis Management: What to Do When a Company/Brand-Threatening Event Occurs, AM, June 2006 (Europe source) http://www.acc.com/legalresources/resour ce.cfm?show=20231
[6] Regester, M., & Larkin, J. (2005). Risk issues and crisis management: A casebook of best practice. Sterling, VA: Kogan Page US.