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Leading through a Crisis

It’s difficult to predict exactly when a crisis will occur, but one thing’s certain, sooner or later, unforeseen, unpleasant challenges will arise. In his new book Crunch Point: The 21 Secrets to Succeeding When It Matters Most (AMACOM, 2006), management and personal success legend Brian Tracy writes, “It is estimated that every business has a crisis every two to three months that, if not handled quickly and effectively, can threaten the very survival of the enterprise. And each person has a crisis—personal, financial, family or health—every two or three months that can knock you off center as well.”

Tracy calls these unexpected difficulties or reversals “crunch points,” and he maintains that it is only by facing these challenges that individuals can grow and show what kind of stuff they’re made of. The way you handle crises, says Tracy, determines your success, health and happiness. The good news is that Tracy believes you can learn to respond to difficulties effectively, which leads to wisdom, maturity and, ultimately, triumph.

Following are some general tips from Crunch Point on how to step up to deal with a crisis, along with some special guidelines for leaders who want to prepare themselves for, and possibly avoid, worst-case scenarios.

How to Be Your Best When the Worst Happens

1. Stay calm. Take a deep breath and refuse to become upset or angry. Lower your emotional flashpoint by asking questions, listening carefully, and thinking only about possible solutions.

2. Be confident in your abilities. Remind yourself: you have handled all kinds of difficulties in the past, and you can handle this problem as well.

3. Dare to go forward. Unexpected reversals and setbacks often stun you into a form of paralysis. Don’t give in to these feelings. Instead, think of specific actions you can take immediately to remedy the situation.

4. Get the facts. Events are seldom as bad as they first appear. Take the time to find out exactly what has happened before you make a decision.

5. Take control. Accept 100 percent responsibility for dealing effectively with the crisis. Refuse to make excuses or blame anyone else. Don’t dwell on the past, which cannot be changed. Focus on what can be done in the future.

6. Cut your losses. Practice zero-based thinking and ask, “Knowing what I now know, is there anything that I wouldn’t start up again, or get into, if I had to do it over?” Be prepared to walk away from a situation that cannot be saved.

7. Manage the crisis. This is the “testing time” that always comes to leaders and people in positions of responsibility. Take charge, make a plan, and get busy resolving the problem.

8. Communicate constantly. Tell everyone who is affected by the crisis exactly what is going on. Practice a “no surprises” policy. Keep people inside and outside of your organization informed and ask for their input and assistance.

9. Identify your constraints. Determine the key goal for getting out of the crunch you are in, and the key factor restricting your progress toward attaining it. Focus on alleviating that single constraint.

10. Unleash your creativity. You are a potential genius; you can find a solution to any problem you face. Think on paper. Define your problem clearly, develop as many possible solutions as you can and then take action.

Crisis Management with a Leadership Edge
  • Practice thinking ahead. One of the key strategies for business and personal success is “crisis anticipation.” This strategy is practiced by outstanding leaders in every field. Look ahead into the future three, six, nine, and twelve months and ask, “What could happen to disrupt my life?” Refuse to play games with your own mind. Don’t wish, hope or pretend that certain things could never happen to you. Force yourself to imagine the worst disaster, no matter how remote. Then carefully consider all the possible consequences of that disaster occurring.
  • Develop a contingency plan. What steps would you take if something went seriously wrong? What would you do first? What would you do second? Develop a scenario—a story and a plan—describing how you would handle a crisis, if it occurred. Such “extrapolatory thinking” is the hallmark of superior problem solvers. After you look down the road and see the worst possible outcomes, come back to the present and focus on preparation and prevention.
  • Take charge immediately. When the worst does happen, don’t let it destroy your self-esteem or your business. Practice damage control. Put every possible limitation on losses. Preserve cash at all costs. Then, gather information. Get the facts. The real facts, not the alleged facts, the assumed facts, the hoped-for facts or the imagined facts. Go straight to the key people and ask them the right questions: What has happened? How, when and where did it happen? Who was involved? Find out exactly what you are dealing with.
  • Solve the problem. Discipline yourself to think only in terms of solutions, not repercussions, regrets or recriminations. Become action-oriented. Determine your next step and then take it. Any decision is usually better than no decision. Remember: there is always an answer and your job is to find it. Often the solution is contained within the problem.
  • Prevent the recurring crisis. A crisis, by definition, is a one-time-only, unexpected, negative event. To ensure the crisis does not repeat itself, after you have resolved it, do a thorough debriefing. What exactly happened and how? What could we do to make sure it doesn’t happen again? According to Stanford University researchers, the single most important leadership trait among the top Fortune 1000 CEOs was their ability to deal with a crisis. Effective and confident crisis management is a true measure of a leader.

Adapted from Crunch Point: The 21 Secrets to Succeeding When It Matters Most, by Brian Tracy (AMACOM, 2006).

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