Crisis Management Report: Theories, Models, Communication and Analysis

This report delves into the multifaceted realm of crisis management, commencing with an introduction that defines crisis as unplanned organizational events causing uncertainty and harm, emphasizing the critical elements of organizational threat, unexpectedness, and time constraints. It then transitions into a discussion of various crisis types, including economic, financial, social, and political crises, each characterized by unique contradictions and impacts. The report further explores several key crisis management theories, such as structural functioning systems theories, diffusion of innovation theory, and the unequal human capital theory, highlighting the importance of communication and employee relations. The report also outlines a crisis management communication model, detailing the crucial stages of diagnosis, planning, and adjustment to changes. Through a review of these theories and models, the report aims to provide a comprehensive understanding of crisis management strategies and their practical application within organizations, supported by relevant literature.

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Crisis Management
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Introduction
Crisis is the unplanned organizational events that lead to uncertainty and harm which lead
to unrest and major disturbances amongst the staff members. A lot of crisis most definitely gives
rise to a feeling of threat and fear in the organization or an individual who in turn loose interest
and trust in the organization.
The most common elements to a crisis are;
a) An organizational threat
b) The unexpected element of surprise
c) Time decision
It is a transformation process where the old or prior systems can no longer be maintained.
Crisis management definitely requires the element of change especially within the organization.
Crisis management can be equated to risk management which involves assessing potential threats
and the best way to avoid these threats. Practice shows that crises are not the same not only for
their own reasons and consequences, but also by their very essence (Booth, 2015). The need for a
branched classification of crises is associated with the differentiation of means and methods of
managing them. If there is a typology and understanding of the nature of the crisis, there are
opportunities to reduce its severity, reduce time and ensure painless flow.
Economic crises reflect acute contradictions in the economy of the country or the economic
state of an individual enterprise, firm. These are crises in the production and sale of goods, the
interaction of economic agents, crises of non-payments, loss of competitive advantages,
bankruptcy,

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In the group of economic crises, one can separately single out financial crises. They
characterize the contradictions in the state of the financial system or the financial capabilities of
the firm. These are crises of monetary expression of economic processes (Frykmer and Tehler,
2018).
Social crises arise when the contradictions or clashes of interests of various social groups or
entities are exacerbated: workers and employers, trade unions and entrepreneurs, workers of
various professions, personnel and managers, etc.(Sarkar and Osiyevskyy, 2018)
There are different theories in crisis management
1) Structural functioning systems theories
Communication plays a pivotal role in crisis management in this theory. The flow of information
and communication flow across all hierarchies is very essential. For effective communication,
transparency must be maintained. Managers and organization leaders must stay in touch with the
junior subordinate staff and ask them to give their level best (Hill and Schilling, 2014).
2) Diffusion of Innovation theory
It supports the sharing and exchange of information especially in times of crisis. It was proposed
by Everett Rogers. The employees should think out of the box to diffuse the crisis tension. It
suggest that one should be ready for an alternative plan and once an employee comes with an
innovative plan or idea, he must cross share with the rest of the group. Effective communication
is essential to pass information and ideas in its desired form.

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3) unequal human capital theory
inequality amongst employees leads to workplace crisis. Discrimination on matters to do with
work such as job profile, salary and caste only lead to frustrations amongst employees. These
leads to the employees designing rumor mills to tarnish the image of the company and earn it a
bad name. A special situation in the group of social crises is the political crisis. It is a crisis in
the political organizational structures structure of society, a crisis of power, a crisis in the
realization of the interests of various social groups, classes, in the management of society
(Kendrick, Cavanagh and Burgess, 2017). Organizational crises are manifested as crises of
division and integration of activities, distribution of functions, regulation of the activities of
individual units, as a separation of administrative units, regions, branches or subsidiaries.
The crisis management communication model
It identified three steps or stages in crisis management
a) The first step is Diagnosis of crisis
It involves detecting an early indicator of crisis. It is for the top brass of the management to sense
the crisis and prepare the employees. The performances must be reviewed from time to time by
the management.
b) Planning
Once detection has been made, the planning process on how to deal with the crisis begins. For
immediate reasons, crises are divided into natural, public, environmentally. The former are

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caused by the natural conditions of life and human activity.. All this cannot but affect the
economy, human psychology, social and political processes (Lins and Tamayo, 2017). At certain
scales such phenomena of nature give birth to crises. The cause of the crisis can be social
relations in all their manifestations. Mistakes cannot be repeated in new systems if planning
stages goes well.
c) Adjusting to changes
The third step is to adjust to changes that for a functioning organization. It is important to always
analyze what were the causes that led to crisis in the first place. Mistakes must not be repeated in
the new systems when plans have been made.
Bibliography

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Booth, S.A., 2015. Crisis management strategy: Competition and change in modern enterprises.
Routledge.
Frykmer, T., Uhr, C. and Tehler, H., 2018. On collective improvisation in crisis management–A
scoping study analysis. Safety Science.
Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated
approach. Cengage Learning.
Kendrick, M.I., Bartram, T., Cavanagh, J. and Burgess, J., 2017. Role of strategic human
resource management in crisis management in Australian greenfield hospital sites: a crisis
management theory perspective. Australian Health Review.
Lins, K.V., Servaes, H. and Tamayo, A., 2017. Social capital, trust, and firm performance: The
value of corporate social responsibility during the financial crisis. The Journal of Finance, 72(4),
pp.1785-1824.
Sarkar, S. and Osiyevskyy, O., 2018. Organizational change and rigidity during crisis: A review
of the paradox. European Management Journal, 36(1), pp.47-58.