Smoldering crisis classification

From Adaptive Cycle
Jump to: navigation, search

Contributors

Adriano Martins

Institute for Crisis Management logo. http://www.crisisexperts.com)

The Institute for Crisis Management established the following classifications to ensure consistency in assessment of any smoldering crisis situation, so that proper response can be developed to minimize the potential of the crisis and to reduce the damage to the business.[1]

Level 1 Level 2 Level 3 Level 4
Description An internal business problem or disruption that can be dealt with and resolved by management responsible for responding to this kind of situation. An internal problem that can be managed by those who are responsible for this area of business, with support from other management or employees who may have to be brought in to assess the situation and help resolve it. An internal problem that has the potential of going “public” via the news media and generating negative reactions from government officials, plaintiff’s attorneys, competitors, investors consumer activists, labor unions, etc. The crisis can still be contained but will require specialized assistance beyond the management capabilities in place to deal with normal business problems. This assistance may be from corporate headquarters, outside legal counsel, and/or consultants who specialize in resolving this kind of problem. The situation is very serious and is likely to be disclosed publicly in the very near future. The public reaction will have a significant adverse impact on the business for a period of weeks or months and top management along with numerous employees and outside consultants will have be diverted from their normal activities to resolve this situation. The financial impact will be substantial and will have a direct and indirect effect on operating results.
Example Employees of an organization are upset with bad work conditions. They talk with their boss to find a solution for this problem. Employees decided to boycott their work temporarily until their problem is solved. Their boss and other higher management discuss the problem with them. Employees decide to stand in demonstration to achieve what they asked for. They also decide to send a letter to their syndicate to find a resolution for their problems. Employees are resisted and don’t have the chance to manifest dissatisfaction. However, they decided manifest. There’s high friction between them and the management, it draws the attention of media which makes the whole story public. Sales go down.
  1. Institute for Crisis Management - Crisis Definition, http://www.crisisexperts.com/crisisdef_main.htm

Contributors

Adriano Martins