‫مرحبا‬

ً
Welcome
Crisis Management
Khaled A. Anter
Let’s start with getting
to know each other
 Ground rules
 Start at 9:00
 First break at 10:30 am (15 min.)

 Second break at 12:00 pm (45 min. include.

Prayer)
 Finish at 2:00 pm

 Cell. Phones silent/no calls during session

 Stop presenter & ask if you have a question

 Relax & have fun

 Henry Ford
((1863-1947
you can not build a reputation“
”based on what you are going to do
 ?What is a crisis
A crisis (from the Greek κρίσις - krisis; plural:
"crises"; adjectival form: "critical") is any event
that is, or expected to lead to, an unstable and
dangerous situation affecting an individual, group,
community or whole society.
More loosely, it is a term meaning 'a testing time'
or an 'emergency event'.
 Definition of a crisis
Crisis is the situation of a complex
system (family, economy, society) when the
system functions poorly, an immediate decision is
necessary, but the causes of the dysfunction are
not known.
 ?What is a crisis management
Crisis management is the process by which an
organization deals with a major event that
threatens to harm the organization, its
stakeholders, or the general public.
Three most common elements to
crises
 (a) a threat to the organization,
(b) the element of surprise,
(c) a short decision time.
 Venette definition
Argues that "crisis is a process of transformation
where the old system can no longer be
maintained.“
Therefore the fourth defining quality is the need
for change.
If change is not needed, the event could more
accurately be described as a failure or incident
Risk assessment Vs. Crisis management

Risk assessment involves
assessment assessing potential
threats and finding the best ways to avoid those
threats, Crisis management involves dealing with
threats before, during, and after they have
occurred.
 Crisis Management
It is a discipline within the broader context of
management consisting of skills and techniques
required to identify, assess, understand, and cope
with a serious situation, especially from the
moment it first occurs to the point that recovery
procedures start.
 Natural

Management
Technological
misconduct

Types
of
Crises
Deception Confrontation

Skewed
Management malevolence
values
 Phases of a Crisis
 Signal detection
 Preparation and prevention
 Containment and damage control
 Business recovery
 Learning
Models and theories associated with
crisis management
 Management Crisis Planning
 Contingency planning
 Business continuity planning
 Structural-functional systems theory
 Diffusion of innovation theory
 Role of apologies in crisis management
 Crisis leadership
 Unequal human capital theory
Case studies
”cases 10“
 Case - I
Tylenol® (J&J) - 1982
 Incident
 Seven individuals died
in metropolitan Chicago
 65 milligrams of cyanide
 Approach
 Recalled and destroyed 31 million capsules
 Cost of $100 million
 CEO, James Burke, appeared in television ads
 News conferences informing consumers of the
company's actions
 Tamper-resistant packaging was rapidly
introduced
 $100,000 reward offered by Johnson & Johnson
on murderer’s head
 Conclusion
 Tylenol remains a top seller, controlling about
35% of the pain killer market in North America
 Case - II
Odwalla Foods - 1996
 Incident
 Apple juice causes an
outbreak of E. coli infection
 Unpasteurized
 Forty-nine cases were
reported
 Death of a small child
 16 criminal counts of
distributing adulterated juice
 Odwalla pled guilty
 Approach
 Within 24 hours, Odwalla conferred with the FDA and
Washington state health officials
 Schedule of daily press briefings
 Press releases which announced the recall
 Expressed remorse, concern and apology
 Detailed symptoms of E. coli poisoning
 Developed effective thermal processes
 All of these steps were communicated through close
relations with the media and through full-page
newspaper ads
 Conclusion
 Despite a net loss for most of 1997, Odwalla worked to
rehabilitate its brand name. In addition to advertising its
new safety procedures, Odwalla released its line of food
bars (its first solid food product line) and entered the
$900 million fruit bar market.
  Another new product was the Future Shake, a "liquid
lunch" aimed at younger consumers. Because of these
efforts, Odwalla was again profitable by the end of
1997, reporting a profit of $140,000 for the third
quarter
Case - III

Pepsi - 1993
 Incident
 Claims of syringes being
found in cans of diet
Pepsi
 Pepsi urged stores not to
remove the product from
shelves
 Situation investigated
 led to an arrest
 Approach
 Pepsi made public and then followed with their first
video news release
 First video showing the production process to
demonstrate that such tampering was impossible within
their factories
 A second video news release displayed the man arrested
 A third video news release showed surveillance where a
woman was caught replicating the tampering incident
 Approach
 The company simultaneously publicly worked with the
FDA during the crisis
 The corporation was completely open with the public
throughout
 Every employee of Pepsi was kept aware of the details
 After the crisis had been resolved, the corporation ran a
series of special campaigns designed to thank the public
for standing by the corporation, Coupons for further
compensation
 Conclusion
 This case served as a model for how to handle
other crisis situations
 Case - IV
Bhopal disaster 1984
 Incident
 One of the world's
worst industrial catastrophes
 A leak of methyl
isocyanate gas and other
chemicals from the plant
 Exposure of hundreds of
thousands of people
 Confirmed a total of 3,787
deaths
 leak caused 558,125 injuries
 Approach
 Illustrates the importance of incorporating cross-
cultural communication in crisis management plans
 Operating manuals printed only in English is an
extreme example of mismanagement
 Indicative of systemic barriers to information diffusion
 Symbolic intervention can be counter productive (Union
Carbide’s upper management arrived in India but was unable to assist in the
relief efforts because they were placed under house arrest by the Indian
government)
 Conclusion
 Seven ex-employees, including the former UCIL
chairman, were convicted in Bhopal of causing
death by negligence and sentenced to two years
imprisonment and a fine of about $2,000 each,
the maximum punishment allowed by law. An
eighth former employee was also convicted, but
died before judgment was passed
 Case - V
Ford and Firestone Tire and
 Rubber Company 2000
 Incident
 15-inch Wilderness AT,
radial ATX and ATX II tire
treads were separating
from the tire core
 leading to grisly,
spectacular crashes
 These tires were mostly
used on the Ford Explorer,
the world's top-selling
(SUV)
 Approach
 First, they blamed consumers for not inflating
their tires properly
 Then they blamed each other for faulty tires and
faulty vehicle design
 Then they said very little about what they were
doing to solve a problem that had caused more
than 100 deaths
 They got called to Washington to testify before
Congress
 Conclusion
 Bridgestone/Firestone recalled 6.5 million tires
 Total cost = 1 Billion $
  Case - VI
Exxon Valdez oil spill
 1989
 Incident
 Spilled millions of
gallons of crude oil into
the waters off Valdez –
Alaska
 The size of the spill is
estimated at 40,900 to
120,000 m3
 Hundreds of miles of
coastline were polluted
and salmon spawning
runs disrupted
 Approach
 Exxon, did not react quickly in terms of dealing with
the media and the public
 The company had neither a communication plan nor a
communication team in place to handle the event
 Exxon established its media center in Valdez, a location
too small and too remote to handle the onslaught of
media attention
 The company acted defensively in its response to its
public
 Even laying blame, at times, on other groups such as
the Coast Guard
 Conclusion
 Litigation was filed on behalf of 38,000 litigants
 A jury awarded plaintiffs US$287 million in
compensatory damages and US$5 billion in
punitive damages
 As of 2010 there are approximately 98 cubic
metres (3,500 cu ft) or 26,000 gallons) of Valdez
crude oil still in Alaska's sand and soil
 Case - VII
The Chernobyl disaster
26 April 1986
 Incident
 Reactor four suffered a
catastrophic power increase
leading to explosions in its
core
 This dispersed large
quantities of radioactive fuel
and core materials into the
atmosphere
 The accident occurred during
an experiment scheduled to
test a potential safety
 Approach
 The reactor had not been encased by any kind of
hard containment vessel
 Because of the inaccurate low readings, the
reactor crew chief assumed that the reactor was
intact
 The readings of another dosimeter brought in by
04:30 were dismissed under the assumption that
the new dosimeter must have been defective
 Approach
 "We didn't know it was the reactor. No one had
told us.“
Lieutenant Volodymyr Pravik, who died on 9 May 1986 of acute
radiation sickness
 Conclusion
 The distrust that many people (both within and
outside the USSR) had in the Soviet authorities
 Over 30 years is estimated at US$235 billion (in
2005 dollars)
 5% - 7% of government spending in Ukraine
still related to Chernobyl
 Case - VIII
Fukushima I nuclear accidents
2011
 Incident
 Following the9.0
magnitude Tōhoku
earthquake and
tsunami on 11 March
2011
 Experts consider it to be
the second largest
nuclear accident after
the Chernobyl disaster
 More complex as all
reactors are involved
 Approach
 Tokyo drinking water exceeded the safe level for
infants
 Prompting the government to distribute bottled
water to families with infants
 A nuclear emergency was declared by the
Government at 19:03 on 11 March
 Initially a 2 km, then 10 km evacuation zone was
ordered
 Approach
 Later Prime Minister issued instructions that
people within a 20 km (12 mile) zone around the
plant must leave
 Urged that those living between 20 km and
30 km from the site to stay indoors
 Six weeks after the crisis began, plans were
announced for a large-scale study of the
environmental and health effects of radioactive
contamination from the nuclear plant
 Conclusion
 A private report by journalists and academics as well as an
investigation by TEPCO.
 The panel said the government and TEPCO failed to prevent the
disaster not because a large tsunami was unanticipated, but
because they were reluctant to invest time, effort and money in
protecting against a natural disaster considered unlikely.
 "The utility and regulatory bodies were overly confident that
events beyond the scope of their assumptions would not occur . .
. and were not aware that measures to avoid the worst situation
were actually full of holes," the government panel said in its final
report.
 ‫‪ Case-IX‬‬
‫حادثة‪ ‬حريق‪ ‬قطار‪ ‬الصعيد‬
‫العياط‪ – ‬مصر‬
‫‪ 20‬فبراير‪ 2002‬م‬
 ‫الدحداث‬
‫كان‪ ‬القطار‪ ‬رقم‪ 832‬المتوجه‪ ‬من‪ ‬القاهرة‪ ‬إلي‪ ‬أسوان‏‪ ,‬قد‪ ‬اندلعت‪ ‬‬ ‫‪‬‬
‫النيران‪ ‬في‪ ‬إحدي‪ ‬عرباته‪ ‬الساعة‪ ‬في‪ ‬الثانية‪ ‬من‪ ‬صباح‪ ‬يوم‪ 20 ‬‬
‫فبراير‪ 2002 ‬م‏‪ ,‬عقب‪ ‬مغادرته‪ ‬مدينة‪ ‬العياط‪ ‬عند‪ ‬قرية‪ ‬ميت‪ ‬القائد‪.‬‬
‫أكد‪ ‬الناجون‪ ‬أنهم‪ ‬شاهدوا‪ ‬ديخانا‪ ‬كثيفا‪ ‬ينبعث‪ ‬من‪ ‬العربة‪ ‬اليخيرة‪ ‬للقطار‏‪ ,‬‬ ‫‪‬‬
‫ثم‪ ‬اندلعت‪ ‬النيران‪ ‬بها‪ ‬وامتدت‪ ‬بسرعة‪ ‬إلي‪ ‬باقي‪ ‬العربات‪ ‬اليخيرة‏‪ ,‬‬
‫والتي‪ ‬كانت‪ ‬مكدسة‪ ‬بالركاب‪ ‬المسافرين‪ ‬لقضاء‪ ‬عطلة‪ ‬عيد‪ ‬‬
‫الحضحى‪ ‬في‪ ‬مراكزهم‪ ‬وقراهم‪ ‬في‪ ‬صعيد‪ ‬مصر‪.‬‬
‫وقام‪ ‬بعض‪ ‬الركاب‪ ‬بكسر‪ ‬النوافذ‪ ‬الزجاجية‏‪ ,‬وألقوا‪ ‬بأنفسهم‪ ‬يخارج‪ ‬‬ ‫‪‬‬
‫القطار‏‪ ,‬مما‪ ‬تسبب‪ ‬في‪ ‬مصرعهم‪ ‬أو‪ ‬غرقهم‪ ‬في‪ ‬ترعة‪ ‬البراهيمية‪ .‬‬
‫وقام‪ ‬قائد‪ ‬القطار‪ ‬بفصل‪ ‬العربات‪ ‬السبع‪ ‬المامية‪ ‬عن‪ ‬العربات‪ ‬‬
‫المحترقة‏‪ ,‬وأيخطر‪ ‬الجهات‪ ‬المعنية‪ ‬بالحادث‏‪ ,‬ثم‪ ‬واصل‪ ‬رحلته‪ ‬يخشية‪ ‬‬
‫توقفه‪ ‬وحدوث‪ ‬كارثة‪ ‬جديدة‪.‬‬
 ‫التناول‬
‫أكد‪ ‬الدكتور‪ ‬عاطف‪ ‬عبيد‪ ‬رئيس‪ ‬مجلس‪ ‬الوزراء‪ ‬ـ‪ ‬عقب‪ ‬زيارته‪ ‬‬ ‫‪‬‬
‫مستشفي‪ ‬العياط‪ ‬المركزي‪ ‬للطمئنان‪ ‬علي‪ ‬المصابين‪ ‬ـ‪ ‬أن‪ ‬الحريق‪ ‬‬
‫اشتعل‪ ‬بعربات‪ ‬القطار‪ ‬بسبب‪ ‬انفجار‪ ‬موقد‪ ‬بوتاجاز‪ ‬في‪ ‬بوفيه‪ ‬إحدي‪ ‬‬
‫العربات‪ ‬بالقطار‏‪ ,‬وامتدت‪ ‬النيران‪ ‬إلي‪ ‬باقي‪ ‬العربات‪ .‬‬
‫تعد‪ ‬حادثة‪ ‬قطار‪ ‬الصعيد‪ ‬التي‪ ‬راح‪ ‬حضحيتها‪ ‬أكثر‪ ‬من‪ ‬ثلثمائة‪ ‬ويخمسين‪ ‬‬ ‫‪‬‬
‫مسافرا‪ ‬السوأ‪ ‬من‪ ‬نوعها‪ ‬في‪ ‬تاريخ‪ ‬السكك‪ ‬الحديدية‪ ‬المصرية‪ ‬أي‪ ‬منذ‪ ‬‬
‫أكثر‪ ‬من‪ ‬مئة‪ ‬ويخمسين‪ ‬عاما‪.‬‬
‫بدأت‪ ‬في‪ ‬القاهرة‪ ‬يوم‪ 27 ‬إبريل‪ 2002 ‬محاكمة‪ 11 ‬مسؤول‪ ‬بهيئة‪ ‬‬ ‫‪‬‬
‫السكك‪ ‬الحديدية‪ ‬في‪ ‬مصر‪ ‬إذ‪ ‬يواجهون‪ ‬اتهامات‪ ‬بالهمال‪ ‬في‪ ‬أسوأ‪ ‬‬
‫حادث‪ ‬قطار‪ ‬مصري‪ ‬أودى‪ ‬بحياة‪ 361 ‬شخصا‪. ‬‬
‫أدت‪ ‬الكارثة‪ ‬إلى‪ ‬استقالة‪ ‬وزير‪ ‬النقل‪ ‬المصري‪ ‬إبراهيم‪ ‬الدميري‪.‬‬ ‫‪‬‬
 Case - X
The Deepwater Horizon oil spill –
2010
”The Macondo incident“
Gulf of Mexico
 Incident
 It is the largest accidental marine oil
spill in the history of the petroleum
industry
 The spill stemmed from a sea-floor oil
gusher that resulted from the April 20,
2010, explosion of Deepwater
Horizon
 BP released a 193-page report on its
web site. The report says BP
employees and those of Transocean
did not correctly interpret a pressure
test, and both companies neglected
signs such as a pipe called a riser losing
fluid. It also says that while BP did not
listen to recommendations
by Halliburton for more centralizers
 Approach
Short-term efforts:
 Remotely operated underwater
vehicles to close the blowout
preventer valves on the well head
 Placing a 125-tonne
(280,000 lb) containment
dome (which had worked on leaks in
shallower water) over the largest leak
and piping the oil to a storage vessel
on the surface
 Positioning a riser insertion tube into
the wide burst pipe
 Approach
 Transocean's Development Driller III started drilling a first
relief well,  GSF Development Driller II started drilling a
second relief
 Each relief well is expected to cost about $100 million
 BP began pumping cement from the top, sealing that part
of the flow channel permanently
 Two weeks later, it was uncertain when the well could be
declared completely sealed
 Even in properly sealed wells, the cement

plugs can fail over the decades and metal

casings that line the wells can rust
 Conclusion
 At first, BP files a 52 page exploration and
environmental impact plan for the Macondo well. The
plan stated that it was "unlikely that an accidental surface or
subsurface oil spill would occur from the proposed activities”
 Mark E. Hafle, a senior drilling engineer at BP, warns
that the metal casing for the blowout preventer might
collapse under high pressure
 The White House oil spill commission released a final
report detailing faults by the companies that led to the
spill
 The panel found that BP, Halliburton, and
Transocean had attempted to work more cheaply and
thus helped to trigger the explosion and ensuing leakage
 Conclusion
 BP released a statement in response to this, saying, "Even prior
to the conclusion of the commission’s investigation, BP instituted
significant changes designed to further strengthen safety and risk
management “
 Transocean, however, blamed BP for making the decisions
before the actual explosion occurred and government officials
for permitting those decisions
 Halliburton stated that it was acting only upon the orders of BP
when it injected the cement into the wall of the well
 Halliburton also blamed the governmental officials and BP. It
criticized BP for its failure to run a cement bond log test
 In the report, BP was accused of nine faults
Better management of decision-making processes“
within BP and other companies, better
communication within and between BP and its
contractors and effective training of key
engineering and rig personnel would have
”prevented the Macondo incident

The White House oil spill

commission panel final report
Lessons learned in
Crisis Management
 Lessons learned in Crisis
Management
 A study identified organizations that recovered and
even exceeded pre-catastrophe stock price
 The average cumulative impact on shareholder
value for the recoverers was 5% plus on their original
stock value
 The non-recoverers remained more or less unchanged
between days 5 and 50 after the catastrophe, but
suffered a net negative cumulative impact of almost
15% on their stock price up to one year afterwards.
 Important
“It is highly recommended to those who
wish to engage their senior management in
the value of crisis management”
Crisis as an Opportunity
 Crisis as an Opportunity
 Management must move from a mindset that manages
crisis to one that generates crisis leadership
 Most executives focus on communications and public
relations as a reactive strategy
 Potential damage to reputation can result from the
actual management of the crisis issue
 Companies may stagnate as their risk
management group identifies whether a crisis is
sufficiently “statistically significant”
 Crisis leadership
Immediately addresses both the damage” 
and implications for the company’s present
and future conditions, as well as
 ”opportunities for improvement
Government and crisis management
 United States National Guard at the federal level
 U.S. Federal Emergency Management
Agency (FEMA) within the Department of
Homeland Security administers the National
Response Plan (NRP)
 This plan is intended to integrate public and
private response by providing a common
language and outlining
Government and crisis management
 The NRP is a companion to the National
Incidence Management System
 FEMA offers free web-based training on the
National Response Plan through the Emergency
Management Institute
 Common Alerting Protocol (CAP) is a relatively
recent mechanism that facilitates crisis
communication across different mediums and
systems “A consistent emergency alert format “
!Remember
 The Crisis Management Toolbox
I. Individual Preparedness Plan Checklist
II. Coordination Authority Public Checklist
III. Command Centers
IV. Incident Command System (Common Terminology)
V. Designating a Spokesperson, backup spokesperson
VI. Media Policies and Procedures (Practicing Tough
Questions/Prepared Statements)
VII. Drill, drill then drill !
Practice Model - I
 ‫شركة الغاز اللهلية‬
‫‪‬‬ ‫)أنت‪ ‬رئيس‪ ‬مجلس‪ ‬إدارة‪ ‬شركة‪ ‬الغاز‪ ‬اللهلية‪) ‬غاز‪ – ‬مصر‬
‫حضر‪ ‬إليك‪ ‬مسئول‪ ‬المان‪ ‬بالشركة‪ ‬يقترح‪ ‬عمل‪ ‬خطة‪ ‬مكافحة‪  ‬‬
‫أزمات‪ ‬لحالة‪ ‬تسريب‪ ‬غاز‪ ‬من‪ ‬شبكة‪ ‬توزيع‪ ‬الغاز‪ ‬الخاصة‪ ‬‬
‫بشركتك‬
‫ماذا‪ ‬تفعل‪ ‬لمواجهة‪ ‬إحتمال‪ ‬لهذة‪ ‬الزمة؟ ‪‬‬
Practice Model - II
 ‫شركة صناعة السيارات الوطنية‬
‫‪‬‬ ‫)أنت‪ ‬مدير‪ ‬إدارة‪ ‬السلمة‪ ‬بشركة‪ ‬السيارات‪ ‬الوطنية‪) ‬شاس‬
‫بعد‪ ‬قراءتك‪ ‬لتفاصيل‪ ‬ما‪ ‬حدث‪ ‬من‪ ‬أزمة‪ ‬دواسات‪ ‬الوقود‪  ‬‬
‫المعيبة‪ ‬بشركة‪ ‬تويوتا‪ ‬العالمية‪ ‬قررت‪ ‬عمل‪ ‬خطة‪ ‬مواجهة‪ ‬‬
‫ازمات‪ ‬التى‪ ‬قد‪ ‬تواجه‪ ‬صناعتك‬
‫ما‪ ‬لهى‪ ‬السيناريولهات‪ ‬التى‪ ‬سوف‪ ‬تفترضها‪ ‬و‪ ‬كيف‪ ‬تضع‪  ‬‬
‫خططها‪ ‬؟‬
Practice Model - III
 ‫منتجع الفيروز – شرم الشيخ‬
‫‪‬‬ ‫قمت‪ ‬بإفتتاح‪ ‬منتجع‪ ‬للسياحة‪ ‬بشرم‪ ‬الشيخ‬
‫الستثمارات‪ ‬الكلية‪ ‬التى‪ ‬قمت‪ ‬بوضعها‪ ‬به‪ ‬تكلفت‪ 30 ‬مليون‪  ‬‬
‫جنية‪ ‬مصرى‪ ‬من‪ ‬أموال‪ ‬القروض‬
‫تريد‪ ‬أن‪ ‬تحمى‪ ‬إستثمارك‪ ‬من‪ ‬المفاجآت ‪‬‬

‫ماذا‪ ‬تفعل؟ ‪‬‬
Last words
Thank you
‫ً شكرا‬