Crisis management
Definition
It is a discipline consisting of skills and techniques required to identify, assess, understand, and cope with a serious situation
Crisis management involves dealing with threats before, during, and after they have occurred
Is the process by which an organization deals with a disruptive and unexpected event that threatens to harm the organization or its stakeholders
Business recovery
When crisis hits, organizations can suffer loss of confidence
You should handle a problem downstream
Damage limitation
To offer employee assistance programs
To disclose as much information as you can
try not to accumulate problems but to solve one by one
inform staff, clearly divide responsibilities to bring the situation out of crisis. Make it clear that this is a temporary condition of the company
Types of crisis
Technological crises
Technological crises are caused by human application of science and technology.
Some technological crises occur when human error causes disruptions
Financial crisis
Banking crisis
Currency crisis
When a bank suffers a sudden rush of withdrawals by depositors, this is called a bank run
A currency crisis results from chronic balance of payments deficits, and thus is also called a balance of payments crisis.
Economic crisis
Example of Country crisis
The financial crisis in Russia 2014-2015
The lack of confidence in the Russian economy steemed from two major factors:
The first is the fall in the price of oil
And the second is the result of international economic sanctions imposed on Russia following russia’s annextation of crimea.
How to prevent a crisis
To take out business interruption insurance
To have some contingency plan
to set up a crisis management team
to predict what crisis could occur
is a significant imbalance in the economic system, often accompanied by losses and the rupture of normal relations in production and market relations.