Firms unprepared for crises, Deloitte says
Despite organisations facing more crises today than ten years ago, almost all leaders overestimate their capability to respond, a new crisis management study from Deloitte has found.
According to the survey, 60 per cent of crisis management leaders believe they face more crises than ten years ago, and while 90 per cent are confident of their capability to respond, only 17 per cent have tested their preparedness.
“Some 80 per cent of organisations worldwide have had to mobilise their crisis management teams at least once in the past two years. Yet only 17 per cent of the 500 senior crisis and risk executives we surveyed actually test their capability,” said Tony Morris, Deloitte Australia crisis management leader.
“From experience we know that it’s the ability to test, rehearse and simulate crises that ensure organisations are ready to respond with skilled leadership and plans that work.
“Being prepared, knowing how best to deal with incidents or issues-led crises, and how to respond to them swiftly and appropriately, are all critical skills to successfully protect your customers and people, your operations, and of course, your reputation and brand.
“That goes for the external response in market with your customers, communities and third-party providers, as well as, and often most importantly, internally, with your people and operators.”
The Deloitte study showed that the top types of crises worldwide are cyber-attacks (46 per cent) followed by safety incidents (45 per cent).
The survey also revealed that 70 per cent of board members said it took their firms up to three years to recover reputation following a crisis, while 16 per cent said it took four years or more.
Financial and operational crises had similar long recovery times, it said.
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