Unit 11 Crisis management

Starting up

A. Work in groups. Think of a crisis you have / your country has experienced. Say what happened and ad how it was handled.

The problem of too many companies who fail, caused by the economic problems in our country. Too many taxes and too many risks in our country to begin your own business.

B. Crisis-management experts have identified 10 key steps for companies in a crisis. Complete steps 5-10 below using the verbs in the box

Analyse / disclose / inform / practise / predict / set up

1. Work out an action plan to ensure the crisis does not happen again.

2. Role-play a potential crisis.

3. Find out what happened and how it happened.

4. Write it down and circulate your crisis-management programme.

5. Try to predict what crises could occur.

6. Set up a crisis- management team

7. Inform the directors

8. Disclose a much information as you can.

9. Analyse the actions you took to deal with the situation.

10. Practise making decisions under stress.

C. Complete this table with the steps in Exercise B. Discuss your answers.

Before the crisis During the crisis After the crisis

2-4-5-9-10 3-6-7-8 1

1

D. Answer these questions.

1. What sort of crisis do business managers have to face?

Economic crisis/ defect in their product / failure of equipment / wrong production of the products / people who are overworked/ A storm,hurricane,tsunami / terrorist attack

2. How is a business crisis different from a business problem?

A business crisis strikes the whole branch and need to be dealt with immediately. A business problem can be solved in your own company and can take several years.

2. Can you think of any examples of recent business crises? Which do you think have been the worst in recent years?

Not particularly but as we know with the financial crisis a lot of small enterprises close. For example in the construction sector a lot of firms have to fire people because there is no work for them. And that’s the cause from people who don’t have enough money anymore to build. Also with the higher taxes and lower subsidies it’s very difficult these times.

Vocabulary

Examples: action plan, admission of liability

A: Contingency / damage / flow / legal / loss / press / press / speed

B: Action / conference / confidence / information / limitation / plan / release / response

Contingency plan, damage of confidence, legal information, legal action, information flow, loss of confidence, limitation of speed, press release, damage limitation, response speed, press conference,

A. Complete these sentences with the word partnerships Exercise A.

1. How quickly management react to a crisis is known as the response speed .

2. In a breaking crisis, a manager may speak to the media at a press conference.

3. Alternatively, there may be a written statement, which is given to the media in the form of an press release

4. During the crisis, management may choose to keep customers, employees and shareholders up to date with a regular flow of information.

5. A(n) action plan is part of a crisis strategy prepared in advance

6. A backup strategy is a(n) contingency plan.

7. The risk of being taken to court is the threat of legal action.

8. An acceptance of responsibility in a crisis is a(n) admission of liability.

9. Following a crisis, a company may suffer a decline in loyalty from its customers, or a(n) loss of confidence in its product or service.

10. Minimising the negative effects of a crisis is known as damage limitation.

B. Match an expression from exercises A and B with each of these verbs. Three of the expressions are not used.

1. implement an action plan

2. issue a press release

3. take legal action

4. hold a press conference

5. suffer loss of confidence

6. prepare a contingency plan

7. control the information flow

C. Answer this question, then discuss your ideas in small groups. Can you give any examples

Which of these word partnerships in exercise C do you think are:

Essential in crisis Important to avoid Useful but not essential1-4-6-7 3-5 2

Listening

A. Listen again and complete these extracts using no more than three words in each gap.… it’s a problem that the company frankly has been very slow to acknowledge and very slow to respond to.

… it was only September 2009 that the company really truly acknowledged there was a problem and said ‘we’re gonna have a recall’.

… its communication around the causes of the problem has been unclear, and consumers have been left confused and…

The classic advice here is tell it and tell it quickly. And the thing to do is to get out there and let people know that you acknowledge that there is a problem, and know that you’re doing something about it.

B. Listen to the second part of the interview and answer these questions.

1. What is the three-part model?

3 parts:

the before piece where you need to attend to the possibility of a crisis. the during piece you know what’s happening during the crisis. the after piece what you do after a crisis.

2. What are the three critical activities or questions for part one ?

An audit ‘what could go wrong’ Identify what could be possibly go wrong (avoid avoidable). Prepare a contingency plan and a dedicated team

C. Listen to the third part. What three things need to be done during a crisis?

Crisis identification recognise there is a crisis. Contain the crisis Resolving the crisis

D. Listen to the final part. What questions does he ask with regard to:

1. The recovery? How do you reintroduce the product? How do you recover from the storm?

2. The auditing of the management of the crisis? What can be learned as result of seeing what worked and what didn’t work?

3. Rebuilding? How does it rebuild its reputation externally? How does it restore the confidence of its customers, of other stakeholders and internally of its employees?

Reading

A. Brainstorm the crises that these companies could have.

A pushchair company : -unsafe design for children /- the factory that provides the essential materials goes bankrupt

A mobile phone company: - cell phones explode/ - batteries dies within a day / - phones bent and need to get back for recovery.

B. Article A : How not to take care of a brand / Article B : Expect the unexpected.

Reading

A. Read your articles again and taken notes on these questions.

1. What crisis happened?- Maclaren: 12 cases where children’s fingertips were chopped off- Air France Concorde: accident involving a Concorde.- Nokia: Recall of 14 million phone batteries.

-Intel: a small proportion of its Pentium microprocessors were faulty

-Toyota: recall of 3.8 million cars with floor mats that van make the vehicles accelerate uncontrollably and crash

2. How did the companies mentioned deal with their crisis?-Maclaren: issuing repair kits for the pushchairs and issuing warnings to owners.- Air France Concorde: withdraw the Concorde from service -> announce an investigation into the accident -> reassure the travelling public that air France was still safe - Intel: recalling and replacing the entire production run of the series.-Nokia: a recall-Toyota: A recall -intel: recalling and replacing the entire production run of the series

3. Be ready, empathise, be polite, don’t discriminate. Good crisis management requires the ability to react to events swiftly and positively, whether or not they have been foreseen.

B. Discuss other companies you know have handled crises well/badly

Sony Ps4 : The network from PlayStation was hacked twice by a young group. Who just wanted to make a statement of how easy it is to enter a network where all the ps4 customers pay for. They did this on Christmas Day and another holiday. Sony responded to their customers that they were working on the problem and afterwards gave a free game on the PlayStation Store.

Language review

A. Match the sentences below (1-12) to these headings (a-f)

1. It wouldn’t have been a problem if they’d told the truth immediately. Reflecting on the past (d)

2. If I were you, I’d give media interviews as soon as possible. Advice/warning/threat (f)

3. We’ll tell the truth if you print the entire statement. bargaining (b)

4. We’ll be able to limit the damage if we pay up now. Speculating about the future (e)

5. If you’d fixed the fault, we’d have placed an order Reflecting on the past (d)

6. Your money back if not 100% satisfied Promise (a)

7. If we recall the products, it will be expensive Speculating about the future (e)

8. If you would like a refund, call customer services on… Invitation/request (c)

9. If you order by the end of the year, we can give you a discount Bargaining (b)

10. I wouldn’t ignore the media if I were you Advice/warning/threat (f)

11. If we’d tested the product properly, we’d have known about this problem. Reflecting on the past (d)

12. I would grateful of you would print our apology as soon as possible. Invitation/request (c)

B. Decide whether each of these situations is a) likely or b) unlikely to happen to you. Then tell your partner what you will or would do.

1. You get a pay rise next year Unlikely, I’m still studying

2. You win a lot of money Unlikely, I never win money.

3. Your computer gets a virus Likely, because I don’t have an anti-virus program.

4. You travel abroad next year Likely, because my girlfriend likes it.

5. You have to give a presentation in English Likely, because I have English in the 3th year as well.

6. Your company is taken over by a competitor Unlikely, I don’t own a company.

Skills

A. Michael Goodrich is a presenter of a television consumer protection programme. Tonight he is questioning Tim Bradshaw, the marketing Director of TG products, a large chain of stores which sells imported toys. Listen to the interview and answer these questions.

1. What kind of toys are popular with children according to Tim Bradshaw?

Stuffed toys, (grey rabbits , dogs and penguins, reindeer and elephants )

2. How many of the toys does his company have in stock?

50 000

3. How serious is the problem with the toys? Explain your answer.

The toys are defective, they should be recalled. The button eyes fall off and the children chew on them and choke

B. Listen again to these questions from the interviewer. In each case, decide whether the question is a) neutral/polite or b) aggressive.

1. Could you please tell me how many of these items you import each month? Neutral

2. Could you be a little more precise? Neutral

3. Roughly how many complaints about the toys do you receive each week? Neutral

4. Isn’t it true you’ve been receiving dozens of complaints from customers every week? Aggressive

5. Do you deny people have been phoning you and e-mailing you constantly to complain about the toys? Aggressive

6. Why are you still selling them? Aggressive

7. Isn’t your real reason for not recalling the toys very obvious, Mr Bradshaw? Neutral

8. But what are you going to do about these defective toys? Aggressive

9. When exactly will you get back to us? Neutral

10. Would you answer my question, please? Aggressive

DVD unit 11