With all the turbulence that has been bucking on Wall Street, the timing in holding a business continuity and corporate security conference in New York the week of March 17 couldn't have been better.
Just as the city that doesn't sleep finished digesting another caffeine pill in the form of the federally backed bailout of Bear Stearns by JPMorgan Chase & Co., Alexander Tabb, a principal with the New York-based Tabb Group, launched into his opening address of the 2008 Business Continuity & Corporate Security show and conference in Manhattan's Chelsea district.
Tabb, whose brow seems to wear perpetual worry lines, may have added a line or two there in the past few weeks.
And he didn't spare the emergency button in departing from his prepared script to caution the crisis management experts in attendance that they had plenty to look forward to from the financial sector.
"We have actually witnessed a modern run on a modern investment bank," is the way Tabb described the sound of Bear Stearns choking on its own line of credit.
Wall Street, which just days earlier saw brokers opening up their windows and shouting their joy into the street after the revelations that the former New York governor was more john than he was John Law, was cowering in fear in the aftermath of the Bear Stearns implosion, according to Tabb.
"Everyone is in shock," said Tabb. "Where was the risk management?"
It was with particularly keen ears that the crisis managers at last week's conference turned their attention to the subject matter that Tabb and other crisis management experts addressed: the current best practices in corporate crisis management.
What quickly emerged in two days of conference presentations was that the best crisis managers make the human factor their primary concern when calamity, or even the rumor of calamity, strikes.
Key among those human factors is the importance of information flow up and down the layers of corporate management in times of emergency.
So is making sure that key decision-makers have enough elbow room to do their jobs. They cannot be swamped by panicky phone calls that other people with less responsibility should be handling.
"How do you protect that core leader who needs to be making a decision?" Tabb said, describing what should be a key concern of crisis management teams.
Someone else put it more bluntly.
"I don't have the time to tell you what your boss' home phone number is," said Lisa J. Sciarrino, a managing director with UniCredit Group and another conference presenter.
Tabb outlined what he considers to be four distinct phases of crisis management: incident response, crisis management, business continuity and recovery.
In every one of those phases, stressed the show's presenters, the best way to survive a business interruption with reputations intact is by keeping in mind the most basic needs of employees.
"Always keep the human factors at the forefront of your response," said John DiNuzzo, a vice president of enterprise business continuity with McLean, Va.-based Freddie Mac.
As that relates to communication in the context of crisis management, DiNuzzo invokes the 15/30 rule. Within 15 minutes of an incident or even the perception of an incident, the crisis management team should meet. And within 30 minutes, the rule dictates, the team should come out with some kind of statement letting employees know that management is acknowledging the issue and is taking steps to address it.
Throughout a crisis or a business interruption, making sure that customers and employees have access to the basics can make all the difference.
Sciarrino points to her crisis management team's practice of catering employees' breakfasts and lunches if their offices are shut down, as they were by the heavy rains and subsequent Con Edison steam-pipe explosion that gave Manhattan the jitters on July 18, 2007.
"A little thing like that made people very happy," she said. She was referring to the free food, not the burst pipe.
DiNuzzo has provided crisis management through a number of noteworthy incidents. Several occurred during his tenure with Bank of America, including Hurricane Katrina's ravaging of the Gulf Coast and when a plane piloted by Yankees pitcher Cory Lidle crashed into a Manhattan high rise in Oct. 2006,sending many New Yorkers into a Sept. 11 posttraumatic stress panic.
Posttraumatic stress is something DiNuzzo said crisis managers should pay attention to. Providing information quickly, accurately and repeatedly and being sensitive to employees' previous experiences with tragedies are important, DiNuzzo said.
Building good relationships with local government is also extremely important, according to DiNuzzo. If you have a first-name-basis relationship with local emergency responders, you're more likely to get timely, accurate information.
That might allow you to stay ahead of the press, which many times get there first, although not necessarily with the best information.
"Be very aggressive with positive information," said DiNuzzo.
Now, more than ever, crisis managers need to be aware that their planning and performance are going to have to sell themselves to the increasingly distracted C- level suites in many companies, according to Tabb.
"This doesn't work unless everyone in the organization knows how the crisis management team works," Tabb said.
is senior editor of Risk & Insurance®.
March 25, 2008
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