Crisis Management Response - What the Board Wants
The COVID-19 pandemic has forced corporate board directors to closely examine their companies' crisis response processes and planning. In this article, Preston Pugh and Abigail Stokes share highlights from their extensive interviews of Fortune 500 directors on crisis response and what steps the directors believe are needed to shore up the gaps. Directors, who spoke without attribution, have served on boards in many different industries, including banking, pharmaceuticals, technology, telecommunications, management consulting, utilities, and apparel. The authors found that "crisis management plans are not an option – they are a must." The directors agreed that "planning for this type of specific crisis is difficult, but now is undoubtedly necessary." While board members were generally satisfied with their company's ability to learn from crises, one noted room for improvement to conduct "a root cause analysis of the crisis, versus just identifying the immediate cause. Sometimes you will get an assessment of what happened, but not why it happened." The directors also all emphasized that the most effective crisis responses will come from a diverse board. "There are so many elements in a crisis – how will the crisis play out, how will consumers view this, etc. It is a missed opportunity if you miss an experience point."