Crisis Management

Running head: Crisis Management

Crisis Management & Team Effectiveness: A Closer Examination

Granville King, IIIIndiana University Southeast

Knobview Hall4201 Grant Line Road

New Albany, IN. 47150Office: 812.941.2681

Fax: 812.941.2529Electronic Mail: gkingiii@ius.edu

Manuscript submitted to the Midwest Academy of Management 45 th Annual Meeting as an original paper in the Social Issues & Environmental Management Track.

Granville King, III (Ph.D., Indiana University, 1994) is an Associate Professor of Organizational Communication at Indiana University Southeast. His primary research interest includes peer reporting, whistle-blowing, and crisis management. His work may be found in a variety of peer-reviewed journals including the Journal of Applied Communication Research, Journal of Business Ethics, and the Journal of Business Communication.

1

Crisis Management

Abstract

Being able to effectively respond in the event a crisis is relevant to an organization’s survival. Whether or not an organization is prepared for a potential crisis depends upon senior officials and other personnel operating within the company. Corporations with established crisis management teams are able to communicate and effectively respond in the event of a crisis. The purpose of this paper is to suggest effective crisis management depends upon several team-related factors that may influence an organization’s response. First, the term crisis is defined, followed by an overview of the differences between crisis communication and crisis management. Second, a review of relevant literature regarding teams and effectiveness is examined. Third, several propositions regarding team effectiveness and crisis management are provided. Finally, suggestions for research and practice are included for review.

Key Words: crisis, decision-making, effective, management, team

2

Crisis Management

Crisis Management & Team Effectiveness: A Closer Examination

Effective crisis management has become significant for organizations operating today. Hardly a week passes when we do not read or hear about an organization being faced with a crisis. A corporation may encounter a number of crises, for example, contamination, fire, leaks, layoffs, takeovers, rumors, mergers, and downsizing just to name a few (Pauchant & Mitroff, 1992). According to the Institute for Crisis Management, a recent list of crisis-prone industries included medical/surgical manufacturers, software manufacturers, pharmaceutical manufacturers, telecommunication companies, computer manufacturers, commercial banks, solid waste disposal companies, security and commodity brokers, life insurance companies, and the airline industry.1

In the event of a crisis, an organization must have formal guidelines and procedures for communicating to employees, as well as the general public. Scholars have noted the importance of an organizational crisis management plan. For example, Fearn-Banks (1996) in her seminal work on crisis communication, stresses the importance of corporations developing and implementing effective crisis management and communication plans. Citing corporate cases, Fearn-Banks outlines to the reader how various organizations where either proactive or reactive in the event of a crisis. Along those same lines, Coombs (1999) text’s also reinforces the significance of crisis planning by focusing upon important issues, such as detection, prevention, preparation, recognition, containment, and recovery. Finally, Barton (2001) suggests today’s organizational leaders must be able to recognize, anticipate, manage, and formally prepare for a crisis.

Organizations that prepare for a crisis often employ the use of teams in developing a crisis management plan (Dorn, 2000). According to Coombs (1999), “a crisis management team is a cross-functional group of people within the organization who have been designated to handle any crisis” (p. 63). A crisis management team may consist of individuals from senior administration, technical operations, public affairs, public relations, consumer affairs, investor relations, and advertising. In other words, the crisis management team should involve personnel from all departments within the organization. This process allows the organization to effectively respond to a myriad of audiences when faced with a corporate crisis (Barton, 1993).

Other researchers have also advocated the use of teams in responding to an organizational crisis. For example, Pearson and Clair (1998) note that organizations will experience greater success when crisis preparation and response rests with a crisis management team than with an individual. In a similar vein, Fink (1986) states “one of the first task of the central core is to draw up a list of names to be added to the crisis management team…this is done so that, when the crisis hits, no one has to sit around and wonder who ought to be called in” (p. 57). Finally, Pearson, Misra, Clair, and Mitroff (1997) note during a crisis, creating and institutionalizing a positive mind-set begins with an effective crisis management team.

Employees who are members of a crisis management team must possess effective communication and management skills. These skills allow team members the opportunity to facilitate and exchange ideas among the organization’s diverse departments, monitor key assumptions that may influence the belief system of the crisis plan, obtain employee opinions on potential crisis and crisis management, and encourage

3

Crisis Management

novel experiments that could benefit the organization in preparing for a crisis (Pauchant & Mitroff, 1992). Also, Ray (1999) notes crisis management teams should be cohesive and possess high levels of communication, trust, involvement, commitment, and delegation. Finally, Coombs (1999) states a crisis management team should possess excellent decision-making skills between group members, and other employees within the organization. All of these skills perform important roles in organizing and designing the plan, selecting and assigning members to crisis units, and training group and organizational members on the crisis plan (Littlejohn, 1983).

Currently, an investigation into issues that may influence the effectiveness of a crisis management team is limited. Scholars have suggested issues involving interpersonal conflict (Coombs, 1999), sub-optimal teams (Pearson, Misra, Clair, & Mitroff, 1997), and ineffective decision-making (Hart, Rosenthal, & Kouzmin, 1993; Pearson & Clair, 1998) may influence members’ efficiency and effectiveness. However, other management and communication issues may also affect a crisis team.

Researchers in management and communication have suggested that a team’s composition (Gruenfeld, Mannix Williams, & Neale, 1996), knowledge level (Devine, 1999), individual attitudes (Pilkington & Lydon, 1997), and member diversity (Knouse & Dansby, 1999) may influence its effectiveness. We can assume these same factors might also perform a significant role within a crisis management team, and influence its overall effectiveness. In order to gain a better understanding of crisis management teams, research needs to explore these issues and other team-related factors.

The purpose of this paper is to examine various factors that may influence the effectiveness of a crisis management team. Practitioners may find the information presented as useful in enhancing their understanding of crisis management and team behavior. From an academic perspective, scholars and students of crisis management may find the information as a starting point in advancing the literature on team effectiveness within crisis management.

This article has been organized into four parts: First, the term crisis is defined, followed by an overview of the differences between crisis communication and crisis management. Next, a review of relevant literature regarding teams and effectiveness is explored, followed by several propositions related to crisis management teams. Finally, suggestions for future research and practice are provided for review.

Crisis DefinedScholars have struggled to find an acceptable definition of a crisis. For example,

Fearn-Banks (1996) defines a crisis as “a major occurrence with a potentially negative outcome affecting an organization, company, or industry, as well as its publics, products, services, or good name” (p. 1). Hamblin (1958) argues a crisis is “ . . . an urgent situation in which all group members face a common threat” (p. 322). Pauchant and Mitroff (1992) perceive a crisis as “a disruption that physically affects a system as a whole and threatens its basic assumptions, its subjective sense of self, its existential core” (p. 12). Fink (1986) claims a crisis is any event that may escalate in intensity; fall under close media and government scrutiny, interferes with normal business operations, and affects the image and bottom line of a company. Barton (1993) notes a crisis “is a major, unpredictable event that has potentially negative results. The event and its aftermath may significantly damage an organization and its employees, products, services, financial condition, and reputation” (p. 2). Lerbinger (1997) perceives a crisis as “an event that

4

Crisis Management

brings, or has the potential for bringing, an organization into disrepute and imperils its future profitability, growth, and possibly its very survival” (p. 4). Ray (1999) tends to view a crisis as an event triggered by organizational fallacies. Finally, Pearson and Clair (1998) view a crisis as “a low-probability, high-impact event that threatens the viability of the organization and is characterized by ambiguity of cause, effect, and means of resolution, as well as by a belief that decisions must be made swiftly” (p. 60).

Surveying the above definitions, certain commonalities appear to be prevalent. First, a crisis is an unplanned event that has the potential of dismantling the internal and external structure of an organization. A crisis may affect not only the employees and other members internal to the organization, but also key publics and stakeholders external to the organization.

Second, a crisis may occur in any organization. For example, nonprofit organizations, governmental agencies, houses of worship, utilities, cooperatives, multinational organizations, and so forth are all susceptible to crisis (Barton, 1993).

Finally, a crisis may affect the legitimacy of an organization. In the event of a crisis, the media’s influence on public perception may affect the livelihood of an organization. The media can influence public perception in regards to issues involving cause, blame, response, resolution, and consequences. Presented in a negative light, the legitimacy of an organization may be threatened (Ray, 1999).

Once an organization is viewed in a negative light, the reputation and the overall survival of the company may be at risk. Senior officials within the corporation will often attempt to communicate with the media, the general public, and key stakeholders in order to appear as having controlled or contained the crisis. Communication presents various challenges in the containment phase of a crisis. For example, not only are key stakeholders informed, progress reports must be the provided, and any actions taken by the crisis team must be reported (Coombs, 1999). In short, what is communicated and by whom within the organization performs a pivotal role. In order to gain a better understanding of crisis communication and how it differs from crisis management, these terms will be explored next.

Differentiating Crisis Communication from Crisis ManagementBeing able to effectively communicate with key publics is central to an

organization in the event of a crisis. As mentioned earlier, what is to be communicated and by whom within the organization is a significant factor for members of a crisis management team. In order to get a full understanding of the role of crisis communication, one must first understand the differences between crisis communication and crisis management.

Crisis communication is “the communication between the organization and its publics prior to, during, and after the negative occurrence” (Fearn-Banks, 1996, p. 2). During the communication phase, the organization must appear to be in control (at least in its appearance) to members external to the corporation (Heath, 1994). Such behavior will direct stakeholders’ physical and psychological responses, as well as impressions about the organization (Ray, 1999).

Organizations use various strategies in communicating during a crisis. For example, an organization might deny responsibility, hedge responsibility (distance or duck responsibility), make amends, elicit sympathy, or use some form of ingratiation tactics in order to win stakeholders support (Ray, 1999). On the other hand, the

5

Crisis Management

organization might attack the accuser. In this case, the crisis manager would confront the person or group who claims that a crisis exists (Coombs, 1999). Other strategic chooses an organization might use are justification – “organization tries to minimize the perceived damage associated with the crisis” (Coombs, p. 123), and corrective action – “the organization seeks to repair the damage from the crisis or take steps to prevent the repeat of the crisis” (Coombs, p. 123).

Crisis management differs from crisis communication. Crisis management is a “systematic attempt by organizational members with external stakeholders to avert crises or to effectively manage those that do occur” (Pearson & Clair, 1998, p. 61). In this case, the organization and members of the crisis management team will attempt to remove some of the risk and uncertainty that would not allow the organization to be in control of its own destiny (Fearn-Banks, 1996). Efforts to control a crisis might center upon whistle-blowers, vandalism, terrorism, indictments, extortion, crashes, and so on.

The organization, along with members of the crisis management team, must decide what issues need to be addressed within a crisis plan. Construction of the crisis management plan may be difficult due to factors associated with team members. Relevant issues such as members’ knowledge, attitudes, leadership, and motivation may affect the construction and implementation of plan. In the next section, we will review significant factors that may influence the effectiveness of a crisis team.

Crisis Management & Team EffectivenessThe use of teams within organizations has become standard practice among

leading corporations today (Devine, Clayton, Philips, Dunford, & Melner, 1999). Companies have found several advantages of using teams, for example, a team generates more information, stimulates creativity, and encourages agreement with important decisions (Beebe & Masterson, 2000). On the other hand, there are also disadvantages to using teams within a corporation, for example, working in teams cost time, energy and resources, conflict can occur, pressures to conform (groupthink) (Mullen, Anthony, Salas, & Driskell, 1994), member domination, and a lack of individual responsibility (Beebe & Masterson, 2000; Engleberg & Wynn, 2000).

Although teams and groups are perceived as synonymous terms, researchers have indicated they are not the same. For example, according to Barker, Wahlers, and Watson (2001), a group is “merely a collection of individuals” (p. 6-7). A group may reside within an organization, a club, a family, or among friends. On the other hand, a team has been defined as “a coordinated group of individuals organized to work together to achieve a specific common goal” (Beebe & Masterson, 2000, p. 6). Likewise, other researchers claim a team to be composed of a group of people “given full responsibility and resources for their performance” (Engleberg & Wynn, 2000, p. 13). Finally, Lumsden and Lumsden (2000) perceive a team as consisting of a group of people that “develop special feelings among its members, creates critical work processes, and reflects leadership for its own development and performance” (p. 12).

Surveying these definitions, certain characteristics appear to be prevalent among teams. First, a team is a diverse group of people with different backgrounds, abilities, and knowledge levels to accomplish a specific task. Second, members of a team work to achieve agreed upon goals. This task is accomplished by team members communicating and arriving at a consensus on how to achieve the desired goal. Finally, team members create a self-identity or self-image that becomes a cohesive and motivating force for its

6

Crisis Management

members (Lumsden & Lumsden, 2000). In other words, some team members are able to motivate other group members based upon their actions, attitudes, and behaviors.

Crisis management members may function as a team within an organization. In order to cope successfully with a crisis, team members must work hard and skillfully use relevant information and procedures at their disposal. Team members must feel and act as members of an effective team (Tjovsold, 1995).

Scholars have suggested various individual and team-related factors may enhance the efficiency and effectiveness of a team (Hirokawa & Keyton, 1995; Klimoski & Jones, 1995). For example, “an individual’s capacity to perform effectively on a team will be related to such things as the pattern of his or her specific aptitudes, general abilities (especially verbal intelligence), and individual and task-specific team abilities” (Klimoski & Jones, p. 302). Whether or not a team is effective will also depend upon the team’s organization (that is, the division of labor and authority among group members), norms (that is, formal and informal rules of conduct that groups develop to regulate their members’ behavior), composition (that is, group characteristics such as task related abilities, values, and needs of team members, and individual difference variables related to age, gender, race), leadership (that is, method of influencing team outcomes through direct and indirect interpersonal means), and size (that is, the number of members to actively participate on a task) (Klimoski & Jones).

Evidence indicates clearly that not all teams are effective (Hirokawa & Keyton, 1995). Placing people in a group and asking them to perform a task does not mean they will effectively perform the specific task. Various factors can influence the efficiency and effectiveness of a team, for example, insufficient time, information resources, procedural conflict, poor group leadership, uninterested and unmotivated members, no organizational assistance, no financial compensation, and changing organizational expectations (Hirokawa & Keyton). Other factors may also influence a team’s effectiveness, for example, prior interactions, team composition, task knowledge, leadership ability, and the organization’s culture (see Figure I).

__________________Insert Figure I Here

__________________Prior interactions, or group familiarity, may influence the effectiveness of a crisis

management team. Researches have suggested team members familiar with one another’s skills, perspectives, and interpersonal styles might display a freer, more open format of communication among group members (Wittenbaum & Stasser, 1996). From a crisis management perspective, this freer, open-style of communication might enhance the overall effectiveness of a crisis team. Researchers found:

Familiar group members were more comfortable disagreeing with one another than groups whose members were unacquainted and were, therefore, forming first impressions during the task. The greater the number of familiar members in a group, the more comfortable they were expressing disagreement, the more open they were to learning from one other, the more they enjoyed working together, and the greater their satisfaction with outcomes. (Gruenfeld, Mannix, Williams, & Neale, 1996, p. 11)

7

Crisis Management

In a similar study, Goodman and Leyden (1991) found job and employee familiarity influenced productivity levels among a group of coal-mining workers. Finally, Liang, Moreland, and Argote (1995) suggest group members who spend time with one another share more experiences than unfamiliar group members. This sharing of experience may result in familiar group members being able to resolve problems, which may plague unfamiliar group members (Liang, et al.). Therefore, from a crisis management perspective, one can assume:

Proposition One: Crisis management teams (CMT) composed of members with prior interactions may be more likely to generate and share ideas with one another than CMT whose members know less about one another.

A second factor that may plague crisis management teams is homogeneity. Homogeneity refers to the extent to which group members are similar in values, psychological make-up, communication style, race, gender, attitudes, beliefs, abilities, skills, decision-making, and task relevant information (Salazar, 1996, 1997). Heterogeneity, on the other hand, refers to the extent to which diversity among group members involving issues such as personality, values, attitudes, abilities, skills, race, gender, decision-making, communication style, and beliefs are held as important factors in reference to team composition.

Research has suggested that homogeneous groups do not perform as well as heterogeneous groups. According to Shaw (1976), “ . . . groups composed of members having diverse, relevant abilities performed more effectively than groups composed of members having similar abilities” (p. 235). The reason for this is because homogeneous groups are typically less goal and task oriented, which leads to unrealistic and poor team decision-making. On the other hand, heterogeneity promotes the opportunity for diverse opinions and attitudes, freedom of expression, and better decision-making by team members (Gouran & Fisher, 1984).

Various studies have found heterogeneous groups do out-perform homogeneous groups. For example, according to Gruenfeld, Mannix, Williams, and Neale (1996), heterogeneity increased the probability that members will question each other’s judgments when information diversity is low. Hoffman (1979) suggests heterogeneous groups are more likely than homogeneous groups to be creative and reach quality decisions. Finally, researchers have indicated personal attributes (that is, diverse values and opinions) of a heterogeneous group performed a significant role during team decision-making (Hoffman & Maier, 1961; Maier & Hoffman, 1960). Therefore, from a crisis management perspective, one can assume:

Proposition Two: Crisis management teams (CMT) whose members are heterogeneous may be more likely to generate better ideas than teams whose members are homogeneous.

Another component that may influence the effectiveness of a crisis management team is knowledge of the task. We can assume that task knowledge would perform a significant role in whether a crisis management team is effective. Team members, who are aware of some of the key components of effective crisis management, may enhance the team’s decision-making in the event of a crisis.

Researchers have found that prior knowledge and information held by group members before a discussion, influenced decision-making effectiveness among group

8

Crisis Management

members. For example, Larson, Foster-Fisherman, and Keys (1994) found that information shared by group members prior to a discussion encouraged the dialogue between group members. According to Larson, et al., the exposure of information prior to and during a discussion, may make it easier for group members to recall information as well as verify the accuracy of information. In a similar study, Stasser, Taylor, and Hanna (1989) found that information known beforehand would encourage the discussion and dialogue among team members.

Other researchers have also taken into account the importance of prior knowledge and team effectiveness. For example, according to Hmelo, Nagarajan, and Day (2000), prior knowledge will influence the effectiveness of a team in solving a problem. In this study, Hmelo, et al. examined the effects of high and low prior knowledge among a group of medical students. This was done by using a computer-modeling tool for conducting experiments in cancer biology. Results found that teams whose members were without prior knowledge needed to learn as they went along. They were unsystematic in planning, interpreting, comprehending, and understanding what they were doing. On the other hand, members with prior knowledge had a greater understanding of the task. They were more structured, knowledgeable, and goal-oriented than the team without prior knowledge.

From a crisis management perspective, one can assume that teams with prior knowledge may be more effective in making a decision-making than teams without prior knowledge. Devine (1999) claims cognitive ability and task knowledge are important when the task has a high degree of complexity and a high-level of decision-making among team members. Thus, based upon this information, proposition three suggests:

Proposition Three: Crisis management teams (CMT) whose members are knowledgeable of the task at hand may be more likely to generate better ideas than members who are not knowledgeable of the task.

A fourth factor that may influence the effectiveness of a crisis management team is the style of leadership. Whether or not an organization is successful in handling a crisis may depend upon the ability of the team’s leader to manage the diverse behaviors of group members and the company’s employees. The crisis leader must possess and demonstrate strong interpersonal skills, which will motivate team members and employees to work towards the organization’s goals. Furthermore, the team leader must be able to emotionally inspire self-confidence in all group members, along with employees that the organization will return to a state of normalcy. Such a team leader must possess a style of charisma that displays loyalty and confidence to the organization and its members.

The term charisma comes from a Greek word-meaning gift (Gibson, Ivancevich, & Donnelly, 2000). Sociologist Max Weber (1947) coined the term charismatic to refer to individuals who were perceived as extraordinarily gifted, or possessing unique qualities that followers may revere with unflinching dedication and awe (Bryman, 1992). According to House (1976), a charismatic leader uses emotions, enthusiasm, and self-confidence to inspire listeners to understand and take-on a specific point of view. House states:

…by the leader’s expression of self-confidence, and through the exhibition of confidence in followers the leader

9

Crisis Management

is also assumed to inspire self-confidence in the followers. Thus, the charismatic leader is asserted to clarify followers’ goals, cause them to set or accept higher goals, and have greater confidence in their ability to contribute to the attainment of such goals. (p. 191)

Other scholars have also noted characteristics of a charismatic leader. For instance, Hackman and Johnson (1996) note that charismatic leaders are relationship builders. That is, charismatic leaders are skilled at linking with others. “Terms such as excitement, adventure, loyalty, and devotion are frequently used to describe charismatic leader-follower relations” (Hackman & Johnson, p. 266)

Charismatic leaders are also visionaries. Charismatic leaders have the ability to create symbolic visions. They look towards the future of the organization or group, without losing track of clearly established norms and values. “The power of the charismatic grows as larger and larger numbers of people accept his/her symbolic focus” (Hackman & Johnson, 1996, p. 266). Stressful conditions involving an organizational crisis, unemployment, or corporate take-over discredit the current definition of reality. Such events allow for a more receptive audience for the charismatic leader’s new vision (Hackman & Johnson).

Finally, charismatic leaders are masters at influencing and inspiring audiences. In some cases, listeners do not question or rebut the charismatic leader’s decision or directives. According to Hackman and Johnson (1996), the charismatic leader displays an image of confidence, competence, and trustworthiness. “They utilize power of positive expectations to generate high productivity and make effective use of language and persuasion to achieve goals” (p. 266). Through their skillful use of rhetoric, the charismatic leader is able to captivate listeners to work towards team and organizational goals.

House (1976) continues this line of reasoning by noting factors such as dominance, need for influence, and a strong conviction in the moral righteousness, differentiate charismatic from non-charismatic leaders. Furthermore, charismatic leaders engage in actions that are perceived as favorable, create an impression of competence and success, articulate ideological goals, communicate high expectations and confidence in all followers, and engage in behaviors that will arouse the interest to accomplish desired goals (House; Hollander & Offermann, 1990; Northouse, 2001).

Organizational researches have successfully linked charismatic leadership with crisis management. For example, Pillai (1996) found that under crisis situations, charismatic leadership appeared to be more effective and prevalent than in non-crisis conditions. In a similar study, House, Woycke, and Fodor (1988) (c.f., House, Spangler, & Woycke, 1991) suggests that “charismatic leadership is required, or at least is more appropriate, in situations that require a combination of highly involved and active leadership plus emotional commitment and extraordinary effort by both leader and followers in pursuit of ideological goals” (p. 117). Finally, Gibson, Ivancevich, and Donnelly (2000) note under conditions of a crisis, charismatic leadership is likely to emerge. In this situation, a leader is given the power to do what is necessary to solve the crisis. Such tactics might include empowering followers, contacting outside agencies, or directly eliminating the crisis. Based upon this information, proposition four states:

10

Crisis Management

Proposition Four: Crisis management teams (CMT) whose leader demonstrates a charismatic style of leadership may be more effective in controlling and eliminating an organizational crisis.

Finally, a fifth factor that may influence the effectiveness of a crisis management team is the organization’s culture. The culture of an organization performs a pivotal role in the event of a crisis. Whether or not an organization returns to business as usual may depend upon the organization’s culture.

Researchers have defined an organizational culture as “what the employees perceive and how this perception creates a pattern of beliefs, values, and expectations” (Gibson, Ivancevich, & Donnelly, 2000, p. 30). Along those same lines, Clampitt (2001) defines a culture as “the underlying belief and value structure of an organization collectively shared by the employees that is symbolically expressed in a variety of overt and subtle ways” (p. 48). Finally, Schein (1985) perceives a culture as consisting of assumptions and beliefs that are communicated and shared by members of an organization.

In the event of a crisis, the values, beliefs, and assumptions held by members of a corporation may affect the organization’s return to normal operation. Some organizations perceive crisis management as futile and not a necessary requirement. This line of thinking may be a result of the current senior officials operating within the organization, or basic beliefs and assumptions that have been carried down from generation to generation. Such faulty rationalizations may cost the organization a huge financial loss, as well as place the organization’s future in jeopardy.

Ray (1999) suggests that crisis management begins with the organization’s culture. “The presence of arrogance or lack of common sense in an organization’s culture can lead to a crisis” (p. 37). For example, managers or senior officials who believe their organization is omnipotent may find they are unprepared in the event of a major crisis. This line of thinking penetrates the inner core of the organization and may influence the effectiveness of a crisis management team

Researchers (Pauchant & Mitroff, 1992) have suggested that some organizations fall victim to self-inflated cultures. That is, some employees within the organization take on self-inflated behaviors described as “dramatic, authoritarian, and grandiose” (p. 68). Individuals with self-inflated behaviors are often perceived as

…interpersonally exploitive, taking advantage of others, developing a sense of entitlement or unreasonable expectations from others; they have developed a grandiose sense of self-importance, exaggerating their achievements and talents, being preoccupied with fantasies of unlimited success, power, or brilliance, and requiring constant attention and admiration from others. They lack empathy, often being unable to recognize or experience the feelings of others, and they have no tolerance for the frustration of delayed gratification. (p. 68)

In the event of a crisis, senior officials, managers, and other employees who suffer with this line of thinking, often react very strongly to a crisis. Members of an organization with self-inflated behaviors may display feelings of shame, rage, and humiliation during a

11

Crisis Management

crisis (Pauchant & Mitroff). In fact, the crisis management team might be viewed as incompetent, negligent, and worthless. As such, the success and effectiveness of the crisis team might be hampered.

Faulty rationalizations by individuals are not the only factor that may plague the effectiveness of a crisis management team. Pauchant and Mitroff (1992) note numerous cultural rationalizations may also influence a crisis management team. In their research, Pauchant and Mitroff found thirty-one faulty cultural rationalizations that hinder crisis management efforts. These faulty rationalizations may be divided into four broad categories namely, properties of the organization, properties of the environment, properties of crisis themselves, and properties of crisis management efforts (see Table I).

____________________Insert Table I Here

____________________Each of these faulty rationalizations may influence the effectiveness of a crisis management team. When these rationalizations are clearly established, a crisis management team may find limited support by the organization and its members. Furthermore, decisions regarding effective crisis management planning might be perceive as non-significant to the organization. Such beliefs, values, and assumptions within an organization’s culture may hamper the performance of team members in the event of a crisis. Therefore, one can assume:

Proposition Five: Crisis management teams (CMT) are less likely to be effective if the culture of the organization does not support crisis planning.

Suggestions for Future Research & Practice The field of crisis management is beginning to attract researchers interest.

Currently, a large majority of the research on crisis management is presented in the form of case studies, normative essays, and various theoretical pieces. Empirical research, however, has yet to test many of the assumptions and propositions forwarded by scholars in the field.

An empirical analysis would validate many of the assumptions and theories presented by scholars. One method of empirically testing for crisis management is to design and administer a mock crisis to an organization. Working directly with senior officials and upper management, researchers would collect valuable information regarding the effectiveness of the crisis team, the crisis plan, and controlling the crisis. Furthermore, valuable information regarding what failed, why it failed, and what changes are needed would be forwarded to the organization for review.

Other methods may also be used for validating many of the arguments and propositions forwarded by researchers. For example, researchers might consider administering hypothetical scenarios. This method would only provide information and data on what a respondent thinks he or she would do in the event of a crisis. In an actual crisis, the respondent’s actions may differ from what was reported. Other methods for collecting empirical data might include surveys, questionnaires, or interviews. Depending upon the research question or hypothesis under investigation, each of these methods of data collection would be useful.

Finally, organizations must do their part in encouraging and practicing effective crisis management. This process begins by addressing problems with the crisis plan,

12

Crisis Management

conducting mock crises, and educating all employees internal to the organization on effective crisis management. Also, the external environment, including key publics and company stakeholders, should be aware of the avenues the organization has undertaken in the event of a crisis. Such a procedure allows the organization to be perceived in a favorable light prior to a crisis.

In closing, the need for effective crisis management is clearly evident. This begins within the organization and with the implementation of an effective crisis team. The propositions forwarded suggest factors that may influence the effectiveness of a crisis management team. Although none of the propositions have been empirically tested, the rationale for each assumption has been clearly presented. Scholars interested in testing these propositions might consider using one of the methods of data collection presented earlier. I encourage them to do so.

13

Crisis Management

References

Barker, L. L., Wahlers, K. J. and K.W. Watson: 2001, Group In Process (6th Edition) (Allyn & Bacon, Boston).

Barton, L.: 1993, Crisis In Organizations: Managing and Communicating In The Heat of Chaos (South-Western Publishing Company, Cincinnati, OH).

Beebe, S. A. and J. T. Masterson: 2000, Communicating In Small Group (Addison Wesley Longman, New York).

Bryman, A.: 1992, Charisma and Leadership in Organizations (Sage Publications, London).

Clampitt, P. G.: 2001, Communicating for Managerial Effectiveness (2nd Edition) (Sage Publications, Thousand Oaks).

Coombs, W. T.: 1999, Ongoing Crisis Communication: Planning, Managing, andResponding (Sage Publications, Thousand Oaks, CA).

Devine, D. J.: 1999, ‘Effects of Cognitive Ability, Task Knowledge, Information Sharing, and Conflict On Group Decision-Making Effectiveness’, Small Group Research 30, 608-634.

Devine, D. J., Clayton, L. D., Philips, J. L., Dunford, B. B and S. B. Melner: 1999,‘Teams In Organizations: Prevalence, Characteristics, and Effectiveness’, Small Group Research 30, 678-711.

Dorn, M.: 2000, ‘An Effective Crisis Response Team’, School Planning & Management 39, 18.

Engleberg, I. N. and D. R. Wynn: 2000, Working In Groups: Communication Principles and Strategies (Houghton Mifflin Company, Boston).

Fearn-Banks, K.: 1996, Crisis Communication: A Casebook Approach (LawrenceErlbaum Associates Publishers, Mahwah, NJ).

Fink, S.: 1986, Crisis Management: Planning for the Inevitable (Amacom, New York).

Gibson, J. L., Ivancevich, J. M. and J. H. Donnelly, Jr.: 2000, Organizations: Behavior, Structure, Processes (Irwin McGraw-Hill, Boston).

Goodman, P. S. and D. P. Leyden: 1991, ‘Familiarity and Group Productivity’, Journal of Applied Psychology 76, 578-586.

14

Crisis Management

Gouran, D. S. and B. A. Fisher: 1984, ‘The Functions of Human Communication in the

Formation, Maintenance, and Performance of Small Groups’, In C. Arnold and J. Bowers (Eds.), Handbook of Rhetorical and Communication Theory (Allyn & Bacon, Boston) pp. 622-658.

Gruenfeld, D. H., Mannix, E. A., Williams, K. Y. and M. A. Neale: 1996, ‘Group Composition and Decision Making: How Member Familiarity and Information Distribution Affect Process and Performance’, Organizational Behavior and Human Decision Process 67, 1-15.

Hackman, M. Z. and C. E. Johnson: 1996, Leadership: A Communication Perspective (Waveland Press, Prospect Heights, Illinois).

Hamblin, R. L.: 1958, ‘Leadership and crisis’, Sociometry 21, 322-335.

Hart, P., Rosenthal U. and A. Kouzmin: 1993, ‘Crisis Decision Making: The Centralization Thesis Revisited’, Administration & Society 25, 12-45.

Heath, R. L.: 1994, Management of Corporate Communication: From Interpersonal Contacts to External Affairs (Lawrence Erlbaum, Hillsdale, N.J.).

Hirokawa, R. Y. and J. Keyton: 1995, ‘Perceived Facilitators and Inhibitors of Effectiveness in Organizational Work Teams’, Management Communication Quarterly 8, 424-446.

Hmelo, C. F., Nagarajan, A. and R. S. Day: 2000, ‘ Effects of High and Low Prior Knowledge on Construction of A Joint Problem Space’, Journal of Experimental Education 69, 36-56.

Hoffman, L. R.: 1979, ‘Applying Experimental Research On Group Problem Solving to Organizations’, Journal of Applied Behavioral Science 15, 375-391.

Hoffman, L. R. and N. R. F. Maier: 1961, ‘Quality and Acceptance of Problem Solutions by Members of Homogeneous and Heterogeneous Groups’, Journal of Abnormal and Social Psychology 62, 401-407.

Hollander, E. P. and L. R. Offermann: 1990, ‘ Power and Leadership in Organizations: Relationships in Transition’, American Psychologist 45, 179-189.

House, R. J.: 1976, ‘A 1976 Theory of Charismatic Leadership’, In J. G. Hunt and L. L. Larson (Eds.), Leadership: The Cutting Edge (Southern Illinois University Press, Carbondale) pp. 189-207.

House, R. J., Spangler, W. D. and J. Woycke: 1991, ‘Personality and Charisma in the U.S. Presidency: A Psychological Theory of Leader Effectiveness’, Administrative Science Quarterly 36, 364-396.

15

Crisis Management

House, R. J., Woycke, J. and E. M. Fodor: 1988, ‘Charismatic and Noncharismatic

Leaders: Differences in Behavior and Effectiveness’, In J. A. Conger, R. N. Kanungo and Associates (Eds.), Charismatic Leadership (Jossey-Bass Publishers, San Francisco) pp. 98-121.

Klimoski, R. and R. G. Jones: 1995, ‘Staffing for Effective Group Decision Making: Key Issues In Matching People and Teams’, In R.A. Guzzo, E. Salas and Associates (Eds.), Team Effectiveness and Decision Making In Organizations (Jossey-Bass Publishers, San Francisco) pp. 291-332.

Knouse, S. B. and M. R. Dansby: 1999, ‘Percentage of Work-Group Diversity and Work-Group Effectiveness’, Journal of Psychology 133, 486-494.

Larson, J. R., Foster-Fishman, P. and C. B. Keys: 1994, ‘Discussion of Shared and Unshared Information in Decision-Making Groups’, Journal of Personality & Social Psychology 67, 446-461.

Lerbinger, O.: 1997, The Crisis Manager: Facing Risk and Responsibility (Lawrence Erlbaum Associates Publishers, Mahwah, NJ).

Liang, D. W., Moreland, R. and L. Argote: 1995, ‘Group Versus Individual Training and Group Performance: The Mediating Role of Transactive Memory’, Personality & Social Psychology Bulletin 21, 384-393.

Littlejohn, R. F.: 1983, Crisis Management: A Team Approach (American Management Association, New York).

Lumsden, G. and D. Lumsden: 2000, Communicating In Groups and Teams (Wadsworth/Thomson Learning, Belmont, CA).

Maier, N. R. F. and L. R. Hoffman: 1960, ‘Quality of First and Second Solutions In Group Problem Solving’, Journal of Applied Psychology 44, 278-283.

Mullen, B., Anthony, T., Salas, E. and J. E. Driskell: 1994, ‘Group Cohesiveness and Quality of Decision Making: An Integration of Test of the Groupthink Hypothesis’, Small Group Research 25, 189-204.

Northouse, P. G.: 2001, Leadership: Theory and Practice (2nd Edition) (Sage Publications, Inc., Thousand Oaks).

Pauchant, T. C. and I. I. Mitroff: 1992, Transforming the Crisis-Prone Organization: Preventing Individual, Organizational, and Environmental Tragedies (Jossey-Bass Publishers, San Francisco, CA).

Pearson, C. M. and J. A. Clair: 1998, ‘Reframing Crisis Management’, Academy of Management Review 23, 59-76.

16

Crisis Management

Pearson, C. M., Misra, S. K., Clair, J. A. and I .I. Mitroff: 1997, ‘Managing the

Unthinkable’, Organizational Dynamics 26, 51-64.

Pilkington, N. W. and J. E. Lydon: 1997, ‘The Relative Effect of Attitude Similarity and Attitude Dissimilarity On Interpersonal Attraction: Investigating The Moderating Roles of Prejudice and Group Membership’, Personality & Social Psychology Bulletin 23, 107-122.

Pillai, R.: 1996, ‘Crisis and the Emergence of Charismatic Leadership in Groups: An Experimental Investigation’, Journal of Applied Social Psychology 26, 543-562.

Ray, S. J.: 1999, Strategic Communication in Crisis Management: Lessons From the Airline Industry (Quorum Books, London).

Salazar, A. J.: 1996, ‘Ambiguity and Communication Effects On Small Group Decision-Making Performance’, Human Communication Research 23, 155-192.

Salazar, A. J.: 1997, ‘Communication Effects on Small Group Decision-Making: Homogeneity and Task As Moderators of the Communication-Performance Relationship’, Western Journal of Communication 61, 35-65.

Schein, E. H.: 1985, Organizational Culture and Leadership (Jossey-Bass, San Francisco).

Shaw, M.E.: 1976, Group Dynamics: The Psychology of Small Group Behavior (2nd Ed.) (McGraw-Hill, New York).

Stasser, G., Taylor, L. A. and C. Hanna: 1989, ‘Information Sampling in Structured and Unstructured Discussions of Three-and Six-Person Groups’, Journal of Personality & Social Psychology 57, 67-78.

Tjosvold, D.: 1995, ‘Cooperation Theory, Constructive Controversy, and Effectiveness: Learning From Crisis’, In R.A. Guzzo, E. Salas and Associates (Eds.), Team Effectiveness and Decision Making In Organizations (Jossey-Bass Publishers, San Francisco) pp. 79-112.

Weber, M.: 1947, The Theory of Social and Economic Organization (A. M. Henderson and T. Parsons, Trans.) (Free Press, Glencoe, Illinois).

Wittenbaum, G. W. and G. Stasser: 1996, ‘Management of Information in Small Groups’, In J.L. Nye and A.M. Brower (Eds.), What’s Social About Social Cognition (Sage Publications, Thousand Oaks) pp. 3-28.

Endnotes1 See Institute of Crisis Management: ICM Crisis Report – News Coverage of

1999 Business Events (August 2000) Vol. 8(1), pp. 2.

17

Crisis Management

Figure I – Factors Which May Influence Crisis Management & Team Effectiveness

18

Prior Interactions

Team Composition

Task Knowledge

Leadership Ability

Organizational Culture

Crisis Management &Team Effectiveness

Table I – Faulty Rationalization That May Influence Effective Crisis Management

Group 1 Group 2 Group 3 Group 4 Properties of the Properties of the Properties of the Properties of Prior Organization Environment Crises Themselves Crisis Management Efforts 1. Our size will protect us. 11. If a major crisis happens, 17. Most crises turn out not 24. Crisis management is like an 2. Excellent, well-managed someone else will rescue us. to be very important. insurance policy; you only need companies do not have 12. The environment is benign; 18. Each crisis is so unique so much. crises. or, we can effectively buffer that it is impossible to 25. In a crisis situation, we just need 3. Our special location will ourselves from the environment. prepare for all crises. to refer to the emergency protect us. 13. Nothing new has really occurred 19. Crises are isolated procedures we’ve laid out in our 4. Certain crises only happen that warrants change. incidents. crisis manuals. to others. 14. Crisis management is someone 20. Most crises resolve 26. We are a team that will function 5. Crises do not require else’s responsibility. themselves; therefore well during a crisis. special procedures. 15. It’s not a crisis if it doesn’t time is our best ally. 27. Only executives need to be aware 6. It is enough to react to a happen to or hurt us. 21. Most (if not all) crises of our crisis plans; why scare crisis once it has 16. Accidents are just a cost of have a technical solution. employees or members of the happened. doing business. 22. It’s enough to throw community? 7. Crisis management or technical and financial 28. We are tough enough to react crisis prevention is a quick-fixes at a problem. to a crisis in an objective and luxury. 23. Crises are solely negative rational manner. 8. Employees who bring bad in their impact. We 29. We know how to manipulate the news deserve to be punished. cannot learn anything the media. 9. Our employees are so from them. 30. The most important thing in dedicated that we trust them crisis management is to protect without question. the good image of the company.10.Desirable business ends 31. The only important thing in justify the taking of high- crisis management is to ensure risk means. that our internal operations stay

intact. From: Pauchant & Mitroff, p. 86

19