CRISIS MANAGEMENT

Yes, small businesses can also, and frequently do, confront a crisis management situation.  The problem is that an erupting crisis does not give you a warning, it just happens. The difference between surviving a crisis and being forced to close your business rests in the preparation, the strategies you create, in advance of the crisis.

Small business owners usually shake their heads when the subject of crisis management is brought up; this is the last topic they want to think about while trying to grow a business. I frequently hear the following from small business owners: “Everything, every day, is a crisis”.

Running a small business is a risk, but risk can be mitigated, as can an unexpected crisis management situation which is often the downfall of a small business. The solution is to draw up a crisis management plan in advance of it happening. Unlike a very large business where a crisis can occur in literally hundreds of different areas, a small business usually has a few very specific issues that should be planned for. Part of any small business operations plan should include the identification of problems, specific to your business that may cause a crisis.  The following are the ones that we have encountered most frequently among small business owners:

• Cash flow problems.
• Loss of a major customer.
• Illness of the owner.
• Your product supplier goes out of business.
• Computer crash – records lost
• Employee leaves with no notice

Once you have identified your own potential crisis management issues in your business the next step is to create an “action solution plan” for each of them. The plan should include not only the specific issue at hand, but also the side effects with your customers, suppliers and perhaps your bank.

Most crises have a way of showing up on your radar prior to happening; if you have action plans in place you can start the correction process before it turns into a “full crisis”.

Start thinking about these potential crises now! Keep a list as they come to your mind. Your next step is to sit with your mentor, or by yourself if you don’t have one, and develop your action solution plans. This also serves as a good look at your business and its current status.

It wasn’t raining when Noah built the ark.”  Howard Huff