While CEOs hope that they will never have to implement one, a crisis management plan is essential for all businesses. Richard Branson has shared his in a recent blog post…
“The test of a company’s leadership, and of a CEO in particular, usually comes during a crisis,” he says. “Whether the upheaval is due to financial difficulties, a scandal or an accident, the chief executive and his senior staff have to lead the company through the crisis and try to assess and mitigate the potential for long-term damage.”
In 2007, a Virgin Trains derailment led to the death of an elderly woman on a train in England, at the time Richard was in Switzerland, where a snowstorm was blowing through.
“Repeating that opening line from Kipling’s If under my breath, I raced to the scene as quickly as I could. The director Woody Allen once famously commented that 80% of life is simply showing up. Indeed, when the chips are down and your company is about to make headlines for the wrong reasons, there is nothing more important for a CEO than being present,” he says.
“As I see it, going to the scene of the disaster is essential. You need to take ownership of the situation. And, more importantly, you need to be on hand to demonstrate your support for everyone involved.”
That’s Richard’s first rule: get to the scene of the crisis as quickly as possible.
The second golden rule for crisis management according to Richard Branson is to demonstrate that you are taking control of your company’s response, even if all you can do is explain that there is little information available.
“For instance, after the Virgin Trains derailment, Britain’s Rail Accident Investigation Branch immediately stepped in and took charge of the investigation. When I arrived at the site, my role was to comfort frightened passengers, express gratitude to our staff and the volunteers for their work, and assure everyone that we would emerge stronger,” Richard explains.
But with that, Richard’s third rule notes the importance of being yourself in the midst of a crisis.
“When AirAsia Flight 8501, en route to Singapore from Indonesia, crashed into the Java Sea in late 2014, AirAsia CEO Tony Fernandes didn’t hide in his office,” Richard says. “He guided his business and employees through the crisis in his own inimitable way, as a family man and strong leader.
“He reached out to the families of those lost in the tragedy, and he demonstrated a sense of perseverance by pushing forward through the company’s darkest days.”
And Richard’s fourth and final rule is to maintain your calm.
Sometimes this might seem impossibly during a prolonged period of upheaval, but Richard uses Virgin Money CEO Jayne-Anne Gadhia as an example. When the financial crisis hit the global economy in 2008, she “adeptly identified opportunities amid the challenges, and managed to rally her team to grow the business further”. She then led Virign Money to a successful initial public offering last year.
Richard says: “In If, Kipling also wrote: ‘If you can meet with Triumph and Disaster And treat those two impostors just the same.’
“He was probably not talking about the corporate world. Nevertheless, an executive’s ability to lead his or her company during the bad times as well as the good shows why only a few executives deserve to have the word ‘chief’ in their title.”
Author: Natalie Clarkson for virgin.com