The Four Stages of a Crisis
A crisis has up to four distinct phases. The goal of crisis planning is to move as quickly from the pre-crisis stage to the post-crisis stage. The ideal response would be to eliminate Stage 2 and 3 below with proper planning and responses.
Stage 1: Prodromal (Pre-Crisis)
This is the warning stage. The event hasn’t happened yet and you may have not even recognized that it could happen. This is the time when you want to assess the impact an actual crisis could have on your company, employees, customers, suppliers, operations and bottom line.
Stage 2: Acute (Crisis)
This is the crisis itself. There’s no turning back now. You will lose some ground, events will occur and you may experience some damage. Ignoring the situation is not an option. The key is to control what you can as much as you can so you can move the situation to the next stage as quickly as possible. The acute stage is the shortest of the four phases, even though it may seem like a lifetime when you’re in the middle of it.
Stage 3: Chronic (Clean-Up)
This is sometimes referred to as the clean-up phase. This is either a time to breathe a sigh of relief because you handled things well or fight your way through upheaval, financial stress, management shake-ups, the loss of customers and at its worse, bankruptcy or the loss of your business. This period can last indefinitely if you failed to do proper planning or failed to respond properly.
Stage 4: Crisis Resolution (Post-Crisis)
This is the turning point where you can turn a challenge into an opportunity. Again, in crisis planning the goal is to go from the first stage – the stage where a crisis could occur – to this stage where a full-blown crisis never occurred or was handled quickly and efficiently because you did your due diligence when it comes to planning.
Crisis Intervention 101
Any crisis falls into four distinct ranges:
- Red Range – These events have a high probability of occurring and have a major impact on your business.
- Yellow Range – These events have a major impact on your business but a lower probability of occurring.
- Blue Range – These events have less impact on your business but a higher probability of occurring.
- Green Range – These events have a low impact and aren’t very likely to occur.
Those crises that fall in the Red Range are the ones you need to focus on most, followed by those in the Yellow Range. Those in the Blue and Green ranges don’t warrant as much attention as they won’t adversely affect your business in the long run even if they do happen.
It can be tempting to work on the Blues and Greens as they take less time and effort to solve, but it may come at the expense of time and resources you could have been using to focus on the crises that will have a serious impact on your business and its operations.
If you do nothing else, try to either reduce the probability a Red Range event will occur or take the steps necessary to reduce its impact on your business.
How do you know which crises belong in which color grouping? Start by thinking up every possible scenario your business can face. No need to rank it at this stage. Focus on creating as complete a list as possible.
Here are just a few to get you started:
- Bomb threat
- Civil disturbance
- Computer hacking
- Consumer boycott
- Loss of a senior partner
- Loss of data
- Power failure
- Unfavorable media coverage
The possibilities are virtually endless, of course, and many will be unique to your business and its location. Many crises are industry or business specific, so think long and hard about every possibility, no matter how remote it may seem, including crises that other businesses or competitors have experienced. There’s no need to factor in a zombie apocalypse or alien invasion at this stage.
Brainstorm all the possibilities. Feel free to engage others in the exercise. Once you have your list, you need to rank each crisis according to how likely it is to occur and what impact it may have on your operations.
Next, we will go through the process step by step.
Table of Contents
2. Why You Need to Plan Now!
3. The Four Stages of a Crisis
4. Assessing Impacts
5. Assessing Probabilities
6. Putting It All Together
7. Plotting the Results
8. Rinse & Repeat
9. Developing an Effective Plan
10. Plan Components
11. Crisis Response Modules
12. Decision Trees
13. Resuming Operations
15. Templates & Resources