Although 60 percent of business decision makers have experienced a crisis and more than half of them have experienced one in the past year, only 53 percent currently have a crisis plan in place, according a new crisis preparedness survey conducted by Burson-Marsteller. The survey also found widespread agreement among business leaders that the uncontrollable and uncertain nature of a crisis means it poses significant threats to a company’s reputation.
According to BM business that is well prepared can save nearly one third of the average cost of overcoming a crisis compared to a business that is not prepared, partly because the average recovery time is two months shorter (an average of seven as opposed to nine months).
“This new study shows that crisis preparedness directly affects a company’s bottom line,” says Jeremy Galbraith, CEO of Burson-Marsteller Europe, Middle East and Africa. “We work with our clients on many different levels to help them relate to and communicate with multiple stakeholders when a crisis hits and on how to implement an evidence-based approach to crisis communications,”
Anders Bylund, head of the EMEA crisis practice at BM, adds: “In an age of uncertainty, with increasingly complex stakeholder arenas for corporations and the speed of events driven by digitalization and globalization, crisis preparedness is more important than ever. Risk assessment, planning and training crisis teams helps companies manage risks, protect trust capital in relation to key stakeholders and to limit negative impact on the bottom line.”
One of the findings of the survey was that businesses without a crisis plan can expect to be harder hit in terms of loss of revenue and layoffs than companies that are well prepared. Other consequences of crises can include falling share prices, loss of corporate reputation, loss of media and/or public trust and law suits by individuals or groups.