Effective crisis management during the coronavirus crisis: questions and answers for SMEs

Whether companies, the authorities, or associations – the coronavirus outbreak is forcing everyone to take action. Many SMEs are setting up task forces and crisis management teams. I would like to use this blog entry to answer four questions that I have often been asked.

Is managing the coronavirus crisis a task for top management?

Yes and no. Yes, because the decisions that need to be made are of fundamental strategic importance and thus a task for management at the highest level. Top management is responsible for the prosperity of the company and for the welfare of its employees, meaning effective crisis management is impossible without targeted decisions on its part.

No, because crisis management lives from the interaction between many individual specialists. Employees with certain qualities – such as resistance to stress – are predestined to take on crisis-prevention and crisis-management tasks. As experts can contribute indispensable specialist knowledge to a crisis team, they should be included in such teams, depending on the situation. In this context, don’t think just of the HR department and specialists in occupational medicine, but also of the press department and internal communications unit. Gathering and disseminating information quickly and systematically can give you a valuable head start, which is why these activities should be centralized in one department. It is a task that can be handled by personal assistants and staff units.

Is it correct that we shouldn’t set up a crisis management team until we have our first suspected case?

No. If you do, you will always remain one step behind the situation as it unfolds. Crisis management can work only if the corresponding infrastructure is already in place – only if it is, will you be able to remain in control throughout the crisis. Set up a team before the crisis hits your company and begin working on potential scenarios before they arise. If you put off acting until the first suspected case is identified in your company, you will miss the opportunity to take action that could delay the spread of the disease (see Süddeutsche Zeitung article in the “Links to further reading”). Remember, prevention is always cheaper than acute crisis management and allows you to steer things proactively – and stay one step ahead of events.

Don’t we have to first wait and see what the authorities say?

No, that isn’t enough. The primary focus of public authorities and government entities is on protecting the general public, not on ensuring business continuity at companies. That is why companies should immediately interpret and adapt official information to their own situation and draw the necessary conclusions for their businesses themselves. Good crisis management means establishing contact in advance with the authorities and other companies so that these parties can be addressed quickly and easily when a crisis arises. This principle of knowing who you have to deal and interact with when things come to a head is a key element of good crisis management.

Should a crisis management team respond only to the current situation?

No. A crisis management team’s work is always forward-looking. The team should evaluate the current situation and estimate the consequences of that situation for the future, so as to be able to take preventive action. A good crisis management team will have potential responses to probable scenarios at hand and be able to constantly adapt these to the latest developments. Simply reacting to the situation would be like chasing after someone – but never catching them. Good crisis managers are like helmsmen who can predict what course their ship will take.

My colleague Christoph Sebald has created a dashboard that unites a variety of different sources of data on the current coronavirus outbreak. You can use this tool for day-to-day monitoring of coronavirus cases at your locations (you will find a link to the tool in the “Links for further reading”).

Here at @Fraunhofer IAO, we are also conducting research into efficient crisis management processes and into methods for evaluating the exercises performed by emergency services and crisis management teams. That’s why I’d be very interested to hear about your experiences with crisis management. Feel free to contact me.

Links to further reading

 Our dashboard for current coronavirus monitoring

Die Wucht der großen Zahl: Background article from the Süddeutsche Zeitung (March 10, 2020) (in German only)