At first glance it may seem to be a contradiction in terms but there is more and more evidence that successful organizations can learn to prepare for the unexpected. What happens when a competitor successfully copies or even improves upon the patent underlying a company’s competitive advantage? How can a company minimize the impact of losing key people, maybe even several at once? What can be done to reduce the effects of a major accident or natural disaster? These questions and many more can be addressed well in advance of them ever happening. By the mere exercise of analyzing the risks, probabilities and impacts of various scenarios strategies can be developed to minimize their negative effects and even radically lower the probability that a risk scenario becomes reality.
A key element in all of this is an intellectual and emotional preparedness that various risk scenarios are possible and some even likely. This mental awareness makes it easier for organizations to manage a crisis if and when it arises. When a corporate nightmare becomes a reality it becomes very clear which organizations have a stable internal culture with strong shared values. It is typical of crisis situations that the “normal” rules no longer apply and it becomes even more important that a strong value system is in place so that employees, customers, suppliers and shareholders feel secure in their actions as well as in the actions of the other stakeholders.
“Great companies know that behind every great risk is a great opportunity”
The behavior of an organization when a newly launched product turns out to have major flaws will have a stronger impact on the long-term success of the company than the actual faulty product will.
Customers of telecom operators can be very forgiving when technical failures cut off their phone service for several hours but they can hold a grudge forever if the company doesn’t manage the situation well.
Great companies know that behind every great risk is a great opportunity and, properly handled, a crisis situation can ultimately increase your customer’s loyalty more than if the crises had never happened.