10 Rules of Effective Crisis Management

What would you do if your office called to report that a crane at one of the company’s construction sites toppled over, killing several workers and pedestrians? What would you do if your CPA said she suspects someone is embezzling funds from your business? What would you do if a downtown parking structure—for which your company served as the general contractor—collapsed?

These scenarios are among the dozens of risks that can create a crisis for construction companies and severely threaten their image, reputation, bottom line and future. Fortunately, there are steps you take now to help prevent, respond to and manage any crisis—actions that can be crucial in surviving and recovering from scores of nightmarish scenarios.

Let’s boil down these steps to the following 10 rules: the 10 Rs of crisis management for construction companies.

1. Risk—Identify the triggers that would cause a crisis for your construction company. Some risks, such as falls, electrocutions and machine-related accidents, may be unique to your industry or business. Other crisis triggers, including allegations of sexual harassment, lawsuits and cybersecurity hacks, can happen to any company.
2. Reduce—Do what you can to lessen known risks. This includes following common-sense accounting procedures to help prevent fraud and forgery or more extensive actions, such as providing safety training or retraining to workers.
3. Ready—Have a crisis plan in place and be prepared to implement it when it’s needed. Because one size will not fit all, the plan should be customized to meet the needs and realities of your construction company.
4. Redundancies—Have backup and contingency plans in case they are required. Since it is impossible to plan for every eventuality, a Plan B, Plan C or Plan D may be needed.
5. Research—Obtain all the information you can about the crisis, including details about what just happened, is happening now or you expect to happen. Knowing the who, what, when, where, why and how of a situation is essential in helping to respond effectively and efficiently.
6. Rehearse—Practice implementing your plans on a regular basis. Having plans and not practicing them is not much different than having no plans at all. The more you practice implementation, the more prepared you will be if and when you need to use them.
7. React—Know in advance what event will trigger a crisis and who at your company is authorized to activate it.
8. Reach out—Immediately communicate with those who are affected by or concerned about the crisis. You may have different stakeholders, such as unions and investors, who would be affected by the situation and would want more information and updates about the crisis and how it was ultimately addressed or resolved.
9. Recover—Know how your construction company would bounce back from a crisis. Planning your company’s recovery from a disaster, scandal or other emergency is just as important as planning its response to it. You will need to get back to normal operations as quickly as possible, and a strong recovery plan will help you do just that.
10. Remember—Keep in mind the experiences of other construction companies that have already gone through a crisis. What can you do to repeat their successes and avoid their mistakes? There is no need to reinvent the wheel when it comes to the best ways to respond to, manage and recover from a crisis.

Some of the Rs may be easier to follow than others, and some can be impossible follow without some advance preparation. That’s especially true for the third R— being ready to implement a crisis plan when necessary. The sad truth is that many businesses do not have a crisis management plan in place and, even if they do, have not updated it or taken steps to ensure it will work in an emergency.

Crisis Management Plans 101

Here’s what you need to know about preparing a basic crisis plan for your construction company. It is not brain surgery and does not have to be a long, drawn-out process. If you put your mind to it, you can have a plan in place within a few hours or a day or two at most. Every plan should have the following key components:

• Trigger—What will trigger a crisis for your business?
• Responsibility—Who will decide when to activate your crisis plan?
• Crisis team—Who will be responsible for implementing the plan, and who will lead the team? Be sure to appoint backups in case anyone on the team is unavailable.
• Actionable steps—What steps have to be taken to deal with the crisis, and in what order?
• Counsel—What outside help will your team need to address and resolve the crisis?
• Emergency contacts—Who should be notified about the crisis? How and when will they be told?
• Public relations—What will you tell the media, and who on your team will tell them, if news organizations find out about the crisis?
• Resolution—How will you define success in resolving the crisis?
• Recovery—How will the company recover from the crisis?

When—not if—your plan is in place, be sure to hold scheduled and surprise exercises to make sure it will work when you need it. Having a plan and not testing it ahead of time isn’t much better than not having a plan at all.