Crisis management isn’t just for large corporations, your small businesses can benefit too. As we learned during the COVID-19 global pandemic, a thoughtful plan can help a business better navigate a recession, natural disaster, civil unrest or other disruptive event, reducing the impact on customers, sales, and health of your business.

Why You Need a Crisis Management Plan

What would you do if your customers couldn’t reach your business after a street closure? If your supply vendor lost a huge order? What if your restaurant business must close after a food safety incident?

Many businesses first experienced crisis management at the beginning of the COVID-19 pandemic in 2020. Maybe you were one of them, learning on the job how to handle issues like inventory delays or remote operations, so as not to become part of the estimated 34% of small businesses that closed during those years. Even now, it’s essential to prepare for a cyber-attack, financial crisis or a natural disaster. Either way, the lessons gained then, can be used now to create a crisis management plan for the future.

What is Crisis Management?

When a crisis happens, like a cyber-attack, a flooded store, or a supply chain problem, you need to act fast. A crisis management plan is how you can address an incident quickly and effectively and get your business back on track. Made ahead of time, it tells you who will respond to circumstances and provides a set of instructions on how to handle them.

How Do you Create a Crisis Management Plan?

A crisis management plan is developed by your business team before an incident occurs. Working together, you and your team brainstorm what you might do if a significant incident puts your business at risk. It outlines procedures and responsibilities for employees on-site as well as key personnel off-site, like suppliers or vendors. It should be written and shared with the staff and be easy to find and follow in a crisis.

managing crisis small business

What Are the 5 Steps to a Crisis Management Plan?

1. Select Your Crises Team – Assemble a group from various segments of the business. They should work well together and perform under pressure. They can begin to research and brainstorm possible scenarios. Consider crisis management software or online templates to get started.

2. Identify Potential Crises – Ask yourself “what are the potential risks to my business and what happens then?” Assess and determine the ways to address problems.  Look at a crisis from all angles, including how it could affect your customer base, employees and suppliers, as well as your general ability to continue your operations and generate revenue.

3. Establish Activation Criteria and Chain of Command – This is where you establish who does what and how they do it. Define who may declare an emergency or critical incident and create chains of command that can implement the action steps in the plan. Be ready to adjust plans as you go, if necessary.

4. Create A Crisis Communication Plan – An essential part of a management plan is messaging and communications. Choose a lead spokesperson who will share information both internally (with employees and stakeholders) and externally (with customers, suppliers and vendors.) Craft a social media or press strategy and assign someone to manage and monitor public response. Knowing what you might say to the press or community leaders can assure your messaging is consistent with other parts of your crisis plan.

5. Review and Revise – Share the plan with your managers and employees to help identify any issues or gaps. Revise regularly or when management shifts. Being aware of the situations your colleagues and competitors face can keep your plan current.

Small business owners who have a business continuity plan can navigate an economic or situational crisis much more successfully because they’ve already worked through key challenges. When you craft and employ crisis management for your small business, you’ll be less likely to be caught off-guard and more confident in your ability to keep your business healthy and strong through tougher times.

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