Are crises really inevitable?

Just about everyone has heard the assertion: It’s not a question of IF you will have a crisis, only a question of WHEN. That might sound like a clever maxim, much loved by consultants and commentators. But is it necessarily true? And is it helpful?

This very common statement might be true, but equally it might not. Major crises are in fact relatively rare, which is one reason why they still create such headlines. Indeed, many organisations operate for decades and never face a genuine, existential crisis (as opposed to short term challenges and embarrassments).

Needless to say, that doesn’t meant they won’t face a crisis tomorrow. But if no serious problem has arisen recently, it’s easy to downgrade the likelihood of that happening in the future. In management terms that leads to the dangerous fallacy of “We’ve never had a crisis so why worry about it now?” which is one of the major barriers to crisis proofing.

So, to opine that “every organisation will have a crisis one day” is not very helpful. What sort of crisis? How serious? How damaging? Will it affect the whole organisation or just one division? And over what time period? The current strategic planning cycle? The life of the organisation? The tenure of the incumbent CEO?

There’s another problem too. Although the threat of supposed inevitability is probably intended to jolt you into action, it may also have the opposite effect: “If a crisis is inevitable at some vague time in the distant future there’s not much I can do about it, so I’ll focus on the here and now.”

Perhaps more useful than the generalized idea of crises being inevitable is the notion of crises as predictable. The former can produce inertia and hopelessness. The latter helps to create a clear path for action. If crises can be predicted, then there ought to be clear steps leaders can take towards prevention (or at least mitigation).

This alternative approach bred the concept of Predictable Surprises as championed by Harvard Professors Max Bazerman and Michael Watkins. They argue that many surprises, in all types of organisations, are predictable and avoidable. Moreover, they say predictable surprises are a failure of leadership, which happen when leaders have all the data and information they need to recognise the potential, or even inevitability, of major problems, but fail to respond with effective preventative action. They label these ‘the disasters you should have seen coming.’

It’s true that some crises are unpredictable and genuinely strike out of the blue. The problem, say Bazerman and Watkins, arises when the event was foreseeable and preventable, yet no action was taken. Indeed, the Institute for Crisis Management calculates that about two-thirds of organisational crises are not sudden unexpected events at all but are ‘smouldering  crises’ which occur after warning signs which should have and could have prompted prior intervention.

The answer, of course, is effective processes to recognise the red flags which precede just about every crisis, and to take proactive steps to make the organisation properly prepared before the crisis strikes.  That’s the core element of the process called Crisis Proofing.

In his best-selling book The Black Swan, Nasim Nicholas Taleb popularised the idea of Black Swan events — which are ‘highly improbable’ but can produce enormous shocks. Taleb’s advice to managers?  “Invest in preparedness, not prediction.”

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About managingoutcomes

Issue and crisis management expert
This entry was posted in Crisis management, Crisis Prevention and tagged , , , . Bookmark the permalink.

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