Crisis management essay

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timer Asked: Nov 14th, 2016

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Managing Crisis Projects • Crisis management requires dealing with stakeholders, being honest with the media and clients, and demonstrating a sincere concern for morality and ethics. High Performance Organization Response Matrix Obama Care • Obama has apologized for his statement of being able to keep ones existing plan • Millions have now signed up and millions now have health care who didn’t have health care previously Iconic Crises While the general public is generally forgiving of crises stemming from natural disasters, this is not the case for most man-made crises. Hurricane Katrina • People dying in the convention center • Gang violence and looting delayed rescue • Lack of leadership, politics between Louisiana governor and New Orleans Mayor • • • • • • • • • • Compilation of Lessons Learned Don’t ignore early warning signs. Listen to the public & employee opinions. Top officials (sponsors) deliver the message. Project manager (spokesman) takes charge. Avoid finger pointing, take ownership. Deeds, not words, preserve credibility. Keep the public informed, don’t lie. Be honest regarding the severity of situation. Show compassion and social responsibility. Have crisis contingency plans available. Victims vs. Villains (p.983) The court of public opinion usually casts the deciding ballot as to whether the company involved in the crisis should be treated as victims or villains. The 2 deciding factors are: 1)Demonstration of social responsibility. 2)How well you deal with the media. Rapid response and acceptance of responsibility is viewed favorably. The longer the situation continues, the more negative the opinion. FORD VERSUS FIRESTONE • Product recalls are costly and embarrassing for the auto industry. Improper handling of a recall can have an adverse effect on consumer confidence and the selling price of the stock. • Ford and tire manufacturer Firestone are still suffering from the repercussions of their handling of a product recall in 2000–2001. FORD VERSUS FIRESTONE (cont) • Ford’s CEO, Jac Nasser, tried to allay consumer fears, but his actions did not support his words. In September of 2000, he refused to testify at the Senate and House Commerce Subcommittee on tire recall stating that he was too busy. In October of 2000, Masatoshi Ono resigned as CEO of Bridgestone, Firestone’s parent company. In October of 2001, Jac Nasser resigned. Both executives departed and left behind over 200 lawsuits filed against their companies. FORD VERSUS FIRESTONE Lessons Learned 1. Early warning signs appeared but were marginally addressed. 2. Each company blamed the other leaving the public with the belief that neither company could be trusted with regard to public safety. 3. Actions must reinforce words; otherwise, the public will become nonbelievers. THE AIR FRANCE CONCORDE CRASH • On July 25, 2000, an Air France Concorde flight crashed on takeoff killing all 109 people on board and 4 people on the ground. Air France immediately grounded its entire Concorde fleet pending an accident investigation. In response to media pressure, Air France used its website for press releases, expressed sorrow and condolence from the company, and arranged for some financial consideration to be paid to the relatives of the victims prior to a full legal settlement. The chairman of Air France, Jean-Cyril Spinetta, visited the accident scene the day of the accident and later attended a memorial service for the victims. THE AIR FRANCE CONCORDE CRASH (cont) Air France’s handling of the crisis was characterized by fast and open communication with the media and sensitivity for the relatives of the victims. The selling price of the stock declined rapidly the day of the disaster but made a quick recovery. THE AIR FRANCE CONCORDE CRASH British Airways (BA) also flew the Concorde, but took a different approach immediately following the accident. BA waited a month before grounding all Concorde flights indefinitely, and only after the Civil Aviation Authority announced it would be withdrawing the Concorde’s airworthiness certification. Eventually, the airworthiness certification was reinstated, but it took BA’s stock significantly longer to recover its decline in price. Lessons Learned from Concorde Crash 1. Air France and British Airways took different approaches to the crisis. 2. The Air France chairman showed compassion by visiting the site of the disaster as quickly as possible and attending a memorial service for the victims. British Airways did neither, thus disregarding their social responsibility. INTEL AND THE PENTIUM CHIP • Intel, the manufacturer of Pentium chips, suffered an embarrassing moment resulting in a product recall. A mathematics professor, while performing prime number calculations on 10-digit numbers, discovered significant round-off errors using the Pentium chips. Intel believed that the errors were insignificant and would show up only in every few billion calculations. But the mathematician was performing billions of calculations and the errors were now significant. • The professor informed Intel of the problem. Intel refused to take action on the problem, stating that these errors were extremely rare and would affect only a very small percentage of Pentium users. The professor went public with the disclosure of the error. INTEL AND THE PENTIUM CHIP • Intel created its own public relations nightmare. Its response was slow and insincere. • Intel tried to solve the problem solely through technical channels and completely disregarded the human issue of the crisis. Telling people who work in hospitals or air traffic control that there is a flaw in their computer but it is insignificant is not an acceptable response. Intel spent more than a half billion dollars in the recall, significantly more than the cost of an immediate replacement. Lessons Learned from Intel and the Pentium Chip 1. Intel’s inability to take immediate responsibility for the crisis and develop a crisis management plan made the situation worse. 2. Intel completely disregarded public opinion. 3. Intel failed to realize that a crisis existed. THE TYLENOL POISONINGS • In September 1982, seven people died after taking Extra-Strength Tylenol laced with cyanide. All of the victims were relatively young. These deaths were the first ever to result from what came to be known as product tampering. All seven individuals died within a oneweek time period. The symptoms of cyanide poisoning are rapid collapse and coma and are difficult to treat. TYLENOL Lessons Learned 1. On crisis projects, the (executive) project sponsor will be more actively involved and may end up performing as the project manager as well. 2. The project sponsor should function as the corporate spokesperson, responsible for all crisis communications. Strong communication skills are therefore mandatory. 3. Open and honest communications are essential, especially with the media. 4. The company must display a social consciousness as well as a sincere concern for people, especially victims and their families. 5. Managing stakeholders with competing demands is essential. TYLENOL Lessons Learned cont. 6. The company, and especially the project sponsor, must maintain a close working relationship with the media. 7. A crisis committee should be formed and composed of the senior-most levels of management. 8. Corporate credos can shorten the response time during a crisis. 9. The company must be willing to seek help from all stakeholders and possibly also government agencies. 10. Corporate social responsibility must be a much higher priority than corporate profitability. TYLENOL Lessons Learned cont. 11. The company, specifically the project sponsor, must appear at the scene of them crisis and demonstrate a sincere compassion for the families of those injured. 12. The company must try to prevent a bad situation from getting worse. 13. Manage the crisis as though all information is public knowledge. 14. Act quickly and with sincerity. 15. Assume responsibility for your products and services and your involvement in the crisis. NESTLÉ’S MARKETING OF INFANT FORMULA • What happens if the corporation truly believes that they are doing good service for humanity, but at the same time part of society believes that an injustice has occurred? • Such was the case at Nestlé’s where corporate management emphatically believed that they were doing a good service for humanity with the distribution of infant formula to Third World nations. • However, infant mortality, estimated to be in the thousands, occurred in Third World nations as a result of Nestlé’s aggressive marketing campaign. • The product is nutritiously beneficial for the infant only if it is mixed with water and fed through clean and sterile bottles, and stored in refrigerators. Many consumers in Third World countries could not meet these product requirements. Nestle Baby Formula Crisis Nestle Baby Formula Crisis Nestle Baby Formula Crisis Lessons Learned from the Nestlé Crisis: 1. Nestlé’s actions were not representative of company demonstrating social responsibility. Its actions may have been legally correct, but they were also morally and ethically incorrect. 2. Nestlé should have used the media to its advantage rather than attacking the media. That made the situation even worse. 3. Nestlé remained in a state of denial over the crisis and refused to accept accountability for its actions. As a result, the media relentlessly looked for “skeletons in the closets,” found some, and reported the results to the public. 4. Nestlé assumed that the public was ignorant of the magnitude of the crisis. Ch. 24 Managing Crisis Projects • Crisis management is the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. Managing Crisis Projects •some projects go bad • some projects actually involve saving the day from a bad situation •Three elements are common to most definitions of crisis: (a) a threat to the organization, (b) the element of surprise, and (c) a short decision time •crisis is a process of transformation where the old system can no longer be maintained." Therefore the fourth defining quality is the need for change.. Managing Crisis Projects • When a project goes bad, time is of the essence and sound decisions must be made quickly, often without the benefit of any kind of planning. "Manage the cause not the result" (W. Edwards Deming) Lessons Learned from the Nestlé Crisis (cont.) 5. The longer the crisis remains in the public’s eye, the greater the tendency for the company to be portrayed as a villain rather than as a victim. 6. Because of Nestlé’s inactions, the size and influence of the boycott grew. 7. Nestlé eventually ran out of options and the corporate image became tarnished because of inactions. 8. Nestlé neglected to realize the importance of demonstrating a concern for people during the crisis. THE SPACE SHUTTLE CHALLENGER DISASTER • On January 28, 1986, the Space Shuttle Challenger lifted off the launch pad at 11:38 AM. • Approximately 74 seconds into the flight, the Challenger was engulfed in an explosive burn and all communication and telemetry ceased. Seven brave crewmembers lost their lives. • Following the accident, significant energy was expended trying to ascertain whether or not the accident was predictable. Controversy arose from the desire to assign, or to avoid, blame. Some publications called it a management failure, specifically in risk management, while others called it a technical failure. • Show Feyman Video The following lessons were learned from the Challenger disaster: 1. The crisis was created by a poor organizational culture. 2. There were significant early warning signs, which if addressed, could have avoided the crisis. They were ignored. 3. The chain of command insulated managers and executives from bad news. 4. Management refused to listen to workers who were pleading for help. 5. There was a questionable concern for human life indicated by the pressure to maintain the schedule at all costs. SPACE SHUTTLE COLUMBIA DISASTER • On February 1, 2003, the Space Shuttle Columbia began its reentry into the Earth’s atmosphere. • The shuttle relied upon the heat-resistant materials and the heat shield to protect it from the heat-producing friction encountered during reentry. • Unfortunately, a problem occurred and the shuttle disintegrated during reentry into the atmosphere, killing its seven person crew. • The technical cause of the accident was traced to liftoff, where a large piece of fuel tank insulation dislodged and hit and damaged the heat-resistant tiles on the leading edge of Columbia’s left wing and punched a hole. SPACE SHUTTLE COLUMBIA DISASTER (cont.) The metal components on the shuttle melt at about 2000°F. The heat-resistant ceramic tiles melt at about 3000°F. The tiles prevent the 10,000°F reentry heat from penetrating the vehicle. During reentry, the heat was then able to penetrate the left wing, eventually melting part of the internal structure of the wing causing it to collapse, and resulting in the shuttle tumbling out of control during reentry. SPACE SHUTTLE COLUMBIA Lessons Learned from the Columbia Disaster: 1-Risk planning was virtually nonexistent. 2. There were no contingency plans for several of the high-risk portions of the space flight. 3. There was a silent safety program in place. 4. There was a poor transfer of knowledge, particularly lessons learned, from the Challenger disaster. Victims vs. Villains Life Cycle of a Crisis 1. 2. 3. 4. 5. Early Warning (complaints, govt. probes, etc.) Problem Understanding (facts vs. opinions) Damage Assessment (throw a wide net) Crisis Resolution (announce the approach) Lessons Learned (study other’s mistakes)* Project managers must deal with all the stakeholders & need strong communication, conflict resolution and negotiation skills. Show Crisis Management Video Crisis Management Elements • • • • • • • • • Leader of the Crisis Team. Crisis Committee. Crisis Communications. Stakeholder Management. Assume Responsibility. Response Time. Compassion. Documentation. Capture Lessons Learned. Project Crises Management-What can Cause a Crises • A significant risk is discovered during the execution of the project • A need for a scope change is discovered when the projected is just about finished • An influential minor stakeholder changes their mind about the project and expresses their opinions to management • A design flaw is uncovered during the exectuion Crises Communication • The most challenging part of crisis communication management is reacting - with the right response - quickly. This is because behavior always precedes communication. Non-behavior or inappropriate behavior leads to spin, not communication. In emergencies, it's the non-action and the resulting spin that cause embarrassment, humiliation, prolonged visibility, and unnecessary litigation. Best Response Be proactive. Break bad news yourself so you can ensure your side of the story is heard. Waiting for someone else to tell it means you will only be responding and not able to contextualize the issue in the most helpful way. Reach out to the media and make your website a destination by updating it with the information the media and the public want, including the bad news Flight 370?? • Malaysian Air Line • Blamed for keeping secret information that has been gathered Rocket Explodes at Launch Orbital Sciences Hyundai, Kia agree to $360M mpg settlement • Washington — Korean automakers Hyundai Motor Co. and Kia Motors Corp. announced Monday they have agreed to a record-setting $360 million settlement for overstating fuel economy ratings. The agreement ends the Environmental Protection Agency's two-year investigation into the automakers' overstatement of mileage ratings for 1.2 million 2011-13 U.S. vehicles. • • • Project Management Homework –Crisis Projects You are the project manager of a $10 Million renovation project of the Old Science building on the X campus. Part of the project includes the removal and replacement of asbestos roofing material. During the course of the project due to negligence of a piping contractor you hired there is a natural gas leak in the building resulting in an explosion which blows a section of the roof off the building releasing a large amount of asbestos dust into the atmosphere around the campus and the East end of city where the school is located. Using the methods discussed in Chapter 24 (Managing Crises Projects) what would be the best approach in remediating the situation with the student population exposed to the hazardous dust, the East end community action group who is about to file a lawsuit. In just two pages discuss the appropriate action, who are the stakeholders, where will you obtain the funds to perform the appropriate remediation, and how you will handle the news media. You also see on TV that several local law forms are running ads encouraging students and citizens to call them to obtain representation in a lawsuit claiming damage to their personal health due to asbestos exposure.
Managing Crisis Projects • Crisis management requires dealing with stakeholders, being honest with the media and clients, and demonstrating a sincere concern for morality and ethics. High Performance Organization Response Matrix Obama Care • Obama has apologized for his statement of being able to keep ones existing plan • Millions have now signed up and millions now have health care who didn’t have health care previously Iconic Crises While the general public is generally forgiving of crises stemming from natural disasters, this is not the case for most man-made crises. Hurricane Katrina • People dying in the convention center • Gang violence and looting delayed rescue • Lack of leadership, politics between Louisiana governor and New Orleans Mayor • • • • • • • • • • Compilation of Lessons Learned Don’t ignore early warning signs. Listen to the public & employee opinions. Top officials (sponsors) deliver the message. Project manager (spokesman) takes charge. Avoid finger pointing, take ownership. Deeds, not words, preserve credibility. Keep the public informed, don’t lie. Be honest regarding the severity of situation. Show compassion and social responsibility. Have crisis contingency plans available. Victims vs. Villains (p.983) The court of public opinion usually casts the deciding ballot as to whether the company involved in the crisis should be treated as victims or villains. The 2 deciding factors are: 1)Demonstration of social responsibility. 2)How well you deal with the media. Rapid response and acceptance of responsibility is viewed favorably. The longer the situation continues, the more negative the opinion. FORD VERSUS FIRESTONE • Product recalls are costly and embarrassing for the auto industry. Improper handling of a recall can have an adverse effect on consumer confidence and the selling price of the stock. • Ford and tire manufacturer Firestone are still suffering from the repercussions of their handling of a product recall in 2000–2001. FORD VERSUS FIRESTONE (cont) • Ford’s CEO, Jac Nasser, tried to allay consumer fears, but his actions did not support his words. In September of 2000, he refused to testify at the Senate and House Commerce Subcommittee on tire recall stating that he was too busy. In October of 2000, Masatoshi Ono resigned as CEO of Bridgestone, Firestone’s parent company. In October of 2001, Jac Nasser resigned. Both executives departed and left behind over 200 lawsuits filed against their companies. FORD VERSUS FIRESTONE Lessons Learned 1. Early warning signs appeared but were marginally addressed. 2. Each company blamed the other leaving the public with the belief that neither company could be trusted with regard to public safety. 3. Actions must reinforce words; otherwise, the public will become nonbelievers. THE AIR FRANCE CONCORDE CRASH • On July 25, 2000, an Air France Concorde flight crashed on takeoff killing all 109 people on board and 4 people on the ground. Air France immediately grounded its entire Concorde fleet pending an accident investigation. In response to media pressure, Air France used its website for press releases, expressed sorrow and condolence from the company, and arranged for some financial consideration to be paid to the relatives of the victims prior to a full legal settlement. The chairman of Air France, Jean-Cyril Spinetta, visited the accident scene the day of the accident and later attended a memorial service for the victims. THE AIR FRANCE CONCORDE CRASH (cont) Air France’s handling of the crisis was characterized by fast and open communication with the media and sensitivity for the relatives of the victims. The selling price of the stock declined rapidly the day of the disaster but made a quick recovery. THE AIR FRANCE CONCORDE CRASH British Airways (BA) also flew the Concorde, but took a different approach immediately following the accident. BA waited a month before grounding all Concorde flights indefinitely, and only after the Civil Aviation Authority announced it would be withdrawing the Concorde’s airworthiness certification. Eventually, the airworthiness certification was reinstated, but it took BA’s stock significantly longer to recover its decline in price. Lessons Learned from Concorde Crash 1. Air France and British Airways took different approaches to the crisis. 2. The Air France chairman showed compassion by visiting the site of the disaster as quickly as possible and attending a memorial service for the victims. British Airways did neither, thus disregarding their social responsibility. INTEL AND THE PENTIUM CHIP • Intel, the manufacturer of Pentium chips, suffered an embarrassing moment resulting in a product recall. A mathematics professor, while performing prime number calculations on 10-digit numbers, discovered significant round-off errors using the Pentium chips. Intel believed that the errors were insignificant and would show up only in every few billion calculations. But the mathematician was performing billions of calculations and the errors were now significant. • The professor informed Intel of the problem. Intel refused to take action on the problem, stating that these errors were extremely rare and would affect only a very small percentage of Pentium users. The professor went public with the disclosure of the error. INTEL AND THE PENTIUM CHIP • Intel created its own public relations nightmare. Its response was slow and insincere. • Intel tried to solve the problem solely through technical channels and completely disregarded the human issue of the crisis. Telling people who work in hospitals or air traffic control that there is a flaw in their computer but it is insignificant is not an acceptable response. Intel spent more than a half billion dollars in the recall, significantly more than the cost of an immediate replacement. Lessons Learned from Intel and the Pentium Chip 1. Intel’s inability to take immediate responsibility for the crisis and develop a crisis management plan made the situation worse. 2. Intel completely disregarded public opinion. 3. Intel failed to realize that a crisis existed. THE TYLENOL POISONINGS • In September 1982, seven people died after taking Extra-Strength Tylenol laced with cyanide. All of the victims were relatively young. These deaths were the first ever to result from what came to be known as product tampering. All seven individuals died within a oneweek time period. The symptoms of cyanide poisoning are rapid collapse and coma and are difficult to treat. TYLENOL Lessons Learned 1. On crisis projects, the (executive) project sponsor will be more actively involved and may end up performing as the project manager as well. 2. The project sponsor should function as the corporate spokesperson, responsible for all crisis communications. Strong communication skills are therefore mandatory. 3. Open and honest communications are essential, especially with the media. 4. The company must display a social consciousness as well as a sincere concern for people, especially victims and their families. 5. Managing stakeholders with competing demands is essential. TYLENOL Lessons Learned cont. 6. The company, and especially the project sponsor, must maintain a close working relationship with the media. 7. A crisis committee should be formed and composed of the senior-most levels of management. 8. Corporate credos can shorten the response time during a crisis. 9. The company must be willing to seek help from all stakeholders and possibly also government agencies. 10. Corporate social responsibility must be a much higher priority than corporate profitability. TYLENOL Lessons Learned cont. 11. The company, specifically the project sponsor, must appear at the scene of them crisis and demonstrate a sincere compassion for the families of those injured. 12. The company must try to prevent a bad situation from getting worse. 13. Manage the crisis as though all information is public knowledge. 14. Act quickly and with sincerity. 15. Assume responsibility for your products and services and your involvement in the crisis. NESTLÉ’S MARKETING OF INFANT FORMULA • What happens if the corporation truly believes that they are doing good service for humanity, but at the same time part of society believes that an injustice has occurred? • Such was the case at Nestlé’s where corporate management emphatically believed that they were doing a good service for humanity with the distribution of infant formula to Third World nations. • However, infant mortality, estimated to be in the thousands, occurred in Third World nations as a result of Nestlé’s aggressive marketing campaign. • The product is nutritiously beneficial for the infant only if it is mixed with water and fed through clean and sterile bottles, and stored in refrigerators. Many consumers in Third World countries could not meet these product requirements. Nestle Baby Formula Crisis Nestle Baby Formula Crisis Nestle Baby Formula Crisis Lessons Learned from the Nestlé Crisis: 1. Nestlé’s actions were not representative of company demonstrating social responsibility. Its actions may have been legally correct, but they were also morally and ethically incorrect. 2. Nestlé should have used the media to its advantage rather than attacking the media. That made the situation even worse. 3. Nestlé remained in a state of denial over the crisis and refused to accept accountability for its actions. As a result, the media relentlessly looked for “skeletons in the closets,” found some, and reported the results to the public. 4. Nestlé assumed that the public was ignorant of the magnitude of the crisis. Ch. 24 Managing Crisis Projects • Crisis management is the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. Managing Crisis Projects •some projects go bad • some projects actually involve saving the day from a bad situation •Three elements are common to most definitions of crisis: (a) a threat to the organization, (b) the element of surprise, and (c) a short decision time •crisis is a process of transformation where the old system can no longer be maintained." Therefore the fourth defining quality is the need for change.. Managing Crisis Projects • When a project goes bad, time is of the essence and sound decisions must be made quickly, often without the benefit of any kind of planning. "Manage the cause not the result" (W. Edwards Deming) Lessons Learned from the Nestlé Crisis (cont.) 5. The longer the crisis remains in the public’s eye, the greater the tendency for the company to be portrayed as a villain rather than as a victim. 6. Because of Nestlé’s inactions, the size and influence of the boycott grew. 7. Nestlé eventually ran out of options and the corporate image became tarnished because of inactions. 8. Nestlé neglected to realize the importance of demonstrating a concern for people during the crisis. THE SPACE SHUTTLE CHALLENGER DISASTER • On January 28, 1986, the Space Shuttle Challenger lifted off the launch pad at 11:38 AM. • Approximately 74 seconds into the flight, the Challenger was engulfed in an explosive burn and all communication and telemetry ceased. Seven brave crewmembers lost their lives. • Following the accident, significant energy was expended trying to ascertain whether or not the accident was predictable. Controversy arose from the desire to assign, or to avoid, blame. Some publications called it a management failure, specifically in risk management, while others called it a technical failure. • Show Feyman Video The following lessons were learned from the Challenger disaster: 1. The crisis was created by a poor organizational culture. 2. There were significant early warning signs, which if addressed, could have avoided the crisis. They were ignored. 3. The chain of command insulated managers and executives from bad news. 4. Management refused to listen to workers who were pleading for help. 5. There was a questionable concern for human life indicated by the pressure to maintain the schedule at all costs. SPACE SHUTTLE COLUMBIA DISASTER • On February 1, 2003, the Space Shuttle Columbia began its reentry into the Earth’s atmosphere. • The shuttle relied upon the heat-resistant materials and the heat shield to protect it from the heat-producing friction encountered during reentry. • Unfortunately, a problem occurred and the shuttle disintegrated during reentry into the atmosphere, killing its seven person crew. • The technical cause of the accident was traced to liftoff, where a large piece of fuel tank insulation dislodged and hit and damaged the heat-resistant tiles on the leading edge of Columbia’s left wing and punched a hole. SPACE SHUTTLE COLUMBIA DISASTER (cont.) The metal components on the shuttle melt at about 2000°F. The heat-resistant ceramic tiles melt at about 3000°F. The tiles prevent the 10,000°F reentry heat from penetrating the vehicle. During reentry, the heat was then able to penetrate the left wing, eventually melting part of the internal structure of the wing causing it to collapse, and resulting in the shuttle tumbling out of control during reentry. SPACE SHUTTLE COLUMBIA Lessons Learned from the Columbia Disaster: 1-Risk planning was virtually nonexistent. 2. There were no contingency plans for several of the high-risk portions of the space flight. 3. There was a silent safety program in place. 4. There was a poor transfer of knowledge, particularly lessons learned, from the Challenger disaster. Victims vs. Villains Life Cycle of a Crisis 1. 2. 3. 4. 5. Early Warning (complaints, govt. probes, etc.) Problem Understanding (facts vs. opinions) Damage Assessment (throw a wide net) Crisis Resolution (announce the approach) Lessons Learned (study other’s mistakes)* Project managers must deal with all the stakeholders & need strong communication, conflict resolution and negotiation skills. Show Crisis Management Video Crisis Management Elements • • • • • • • • • Leader of the Crisis Team. Crisis Committee. Crisis Communications. Stakeholder Management. Assume Responsibility. Response Time. Compassion. Documentation. Capture Lessons Learned. Project Crises Management-What can Cause a Crises • A significant risk is discovered during the execution of the project • A need for a scope change is discovered when the projected is just about finished • An influential minor stakeholder changes their mind about the project and expresses their opinions to management • A design flaw is uncovered during the exectuion Crises Communication • The most challenging part of crisis communication management is reacting - with the right response - quickly. This is because behavior always precedes communication. Non-behavior or inappropriate behavior leads to spin, not communication. In emergencies, it's the non-action and the resulting spin that cause embarrassment, humiliation, prolonged visibility, and unnecessary litigation. Best Response Be proactive. Break bad news yourself so you can ensure your side of the story is heard. Waiting for someone else to tell it means you will only be responding and not able to contextualize the issue in the most helpful way. Reach out to the media and make your website a destination by updating it with the information the media and the public want, including the bad news Flight 370?? • Malaysian Air Line • Blamed for keeping secret information that has been gathered Rocket Explodes at Launch Orbital Sciences Hyundai, Kia agree to $360M mpg settlement • Washington — Korean automakers Hyundai Motor Co. and Kia Motors Corp. announced Monday they have agreed to a record-setting $360 million settlement for overstating fuel economy ratings. The agreement ends the Environmental Protection Agency's two-year investigation into the automakers' overstatement of mileage ratings for 1.2 million 2011-13 U.S. vehicles. • • • Project Management Homework –Crisis Projects You are the project manager of a $10 Million renovation project of the Old Science building on the X campus. Part of the project includes the removal and replacement of asbestos roofing material. During the course of the project due to negligence of a piping contractor you hired there is a natural gas leak in the building resulting in an explosion which blows a section of the roof off the building releasing a large amount of asbestos dust into the atmosphere around the campus and the East end of city where the school is located. Using the methods discussed in Chapter 24 (Managing Crises Projects) what would be the best approach in remediating the situation with the student population exposed to the hazardous dust, the East end community action group who is about to file a lawsuit. In just two pages(line size 12 and one space not double space between lines ) discuss the appropriate action, who are the stakeholders, where will you obtain the funds to perform the appropriate remediation, and how you will handle the news media. You also see on TV that several local law forms are running ads encouraging students and citizens to call them to obtain representation in a lawsuit claiming damage to their personal health due to asbestos exposure.

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