Crisis management – Now is the time for real leaders
In her speech on 18th March 2020, German Chancellor Angela Merkel described the COVID-19 pandemic as the biggest challenge since the Second World War. Leaders who have the task of guiding their companies through this crisis situation, the extent and duration of which cannot be predicted at present, are also facing a historic challenge.
Managers are completely exposed in times of crisis. It is therefore the litmus test for true leadership. But what makes a real leader?
Part 1: Staying cool under pressure
Under normal circumstances, managers have the opportunity to solve problems through financial and human capital. However, financial capital is only available to a limited extent or not at all in these times. Throwing money at problems is simply not (any longer) possible for the majority of companies. All that managers really have is themselves and their employees. So, they have to concentrate on this – much more intensely than before. Leaders are challenged in crisis situations to lead companies and employees into the future despite existing risks and uncertainties.
Five types of behaviour are essential here:
1. Ability to stay cool under pressure
4. Setting the right priorities
5. Making tough decisions
In this series, we will look at the five behaviours in more detail over the coming weeks.
1. Ability to stay cool under pressure
Crisis advisor and author of Crisis Leadership, Tim Johnson, believes that developing a “crisis-capable culture and leadership personality” is essential to making well-considered and wise decisions. (1)
He describes two forms of behaviour that arise from a “fight-or-flight reaction” and that can often lead to bad decisions:
1. Intervention bias: the urge to overreach and take on tasks for which an organisation is ill-equipped
2. Abdication bias: avoiding responsibility or blaming others
To actually lead in a crisis, according to Johnson, you have to avoid these impulses and instead find out what is really happening. “Resist the urge to do something immediately. Ignore the adrenaline, work with a powerful team, get the facts, ask questions and listen, then make a plan.” He refers to the reaction of President George W. Bush after the September 11 attacks; even after receiving information about the terrorist attack, he continued to sit with Florida school children. “By not reacting outwardly, he has bought himself space to think and time to react,” says Johnson.
According to Lucy English, Vice President for Research and Science at meQuilibrium, research shows that around 50% of people are “worst case thinkers”. They operate in crises with a dominant sense of fear. This means they bring in negative energy and focus on doomsday scenarios. According to English, the antidote to this is that leaders must start from a realistic assessment of what is most likely to happen. This creates a mindset that starts from scenarios “that are inherently less frightening”. By assessing the most likely outcome rather than the worst-case scenario, leaders can challenge their teams to move the needle into a more positive area.
By using this mindset, leaders can ensure that the crisis binds their teams together rather than scaring them. Leaders need to think about how the company could emerge from this incident stronger, more committed and more capable than before. This involves leaders reassuring and encouraging every employee across the organisation that “we can make it happen” and then supporting them both at work and at home. (2)
In Forged in Crisis, Nancy Koehn, a historian at Harvard Business School, compares the behavior of five leaders in long-term crisis situations where people had to make a variety of decisions: Ernest Shackleton, Abraham Lincoln, Frederick Douglass, Dietrich Bonhoeffer (a German clergyman and anti-Nazi resistance fighter) and environmentalist Rachel Carson. Two qualities that have distinguished all these personalities are forethought and a willingness to be patient under pressure. Lincoln, for example, “discovered the power to control his emotions carefully enough in a given situation not to take immediate action or, in some cases, to do nothing at all.” She writes: “In our own white-hot moment, when so much of our time and attention is focused on immediate reaction, it seems almost inconceivable that doing nothing might be the best we can offer. But history shows that in some crises this is the case.” (3)
Photo by Clark Van Der Beken on Unsplash