How to (mis)handle a crisis
The story of the Covid-19 crisis is not finally told. However, what is clear is that it will be a story of leadership success and leadership failure. Throughout the crisis, we have seen examples of leaders at all levels of government, business, and civil society who rose to the challenge, took ownership, and demonstrated competence, sound judgment, and authentic human concern. And we’ve seen lots of leaders who failed miserably in this regard. “Whatever the outcome of this crisis will be – there are important leadership lessons to be learned,” says leadership expert Prof. Günter Stahl, a long-standing faculty member of the WU Executive Academy.
“For me, one of the iconic moments of this pandemic was when sailors aboard the aircraft carrier USS Theodore Roosevelt applauded their commander, Capt. Brett Crozier, as he disembarked the ship for the last time (https://www.wsj.com/articles/captain-fired-by-navy-gets-rousing-farewell-from-sailors-11585933116) – an overwhelming show of support for their leader, who was relieved of his command after issuing a stark warning about a coronavirus outbreak on board,” says Günter Stahl, Professor of International Management and Co-Director of the Center for Sustainability Transformation and Responsibility (STaR) at WU Vienna.
Crozier was dismissed for circulating his letter broadly via email and because the letter did not flow cleanly up the chain of command. Technically, this might have been a violation of regulations. According to the retired Rear Admiral in the US Navy John Kirby, however, the removal of a commander who had his crew “at the center of his heart and mind in every decision” right in the middle of a potentially deadly epidemic aboard his ship “was reckless and foolish.” “This move has not only sent a horrible message to other commanding officers facing similar dilemmas, it is also an example of total leadership failure,” adds Stahl.
There are several leadership lessons to be learned from this and other cases that illustrate effective and ineffective handling of a crisis like the Covid-19 outbreak. The six most important according to Stahl are:
In times of crisis, the biggest mistake for leaders is to try to control everything and over-centralize decision-making. Top-level leaders – be it in government, the military, or business – need to empower those who lead on the front lines. This involves establishing clear guiding values and principles, and not punishing people for making decisions that are in line with these principles. For military officers, a fundamental leadership principle is that the well-being of the sailors and soldiers always comes first, and that they should never be put at unnecessary risk. Sometimes this entails bending the rules, as in the case of the above-mentioned Navy officer who skipped the chain of command, but failing to act would have been much worse in a situation where the virus would have assuredly raged through the aircraft carrier, given the close quarters of life on such vessels.
Capt. Crozier knew it was a matter of only a little time before the entire carrier would come down with the virus, given the fact that more than 150 sailors on board had already been infected, so he took drastic action. During the coronavirus crisis, we saw that those countries generally did best that had government leaders who took early, decisive action to curb the spread. For example, Taiwan’s effective crisis management and rapid response to the outbreak is widely considered a model of how democracies can deal with epidemics. Led by Tsai Ing-wen, Taiwan’s first female president, the government was quick to respond to the crisis and took decisive measures early on, including a travel ban, strict punishments for anyone found breaching home quarantine orders, and large-scale testing.
In an acute crisis like the coronavirus outbreak, leaders need to embrace action, prioritize speed over perfection, and focus on the immediate steps necessary to stabilize the situation and mitigate the damage (ensure the safety of the people, maintain liquidity, reach out to customers, etc.). The time horizon is severely shortened, and streamlining decision-making, executing short-term plans, and restoring the effective functioning of the organization become priorities. Louis Gerstner, who took the helm at IBM when the company was on the brink of collapse, described the kind of short-term thinking needed in a major crisis in his book about the IBM turnaround: “The last thing IBM needs right now is a vision. The real issue is going out and making things happen every day.” However, this short-term action orientation must be balanced with a broad, holistic view of the situation and early steps to prepare the organization for what will come next. As McKinsey consultants D’Auria and De Smet have recently noted, “what leaders need during a crisis is… mindsets that will prevent them from overreacting to yesterday’s developments and help them look ahead.” Or, in the words of Wharton professor Mauro F. Guillén, “plans are worthless during a crisis, but planning is essential.” The organization needs to be prepared for the time after the crisis.
The leaders who are most effective in times of crisis are those who seek out individuals who have a different perspective on an issue. They include people in their inner circle with whom they might not agree but whose opinions they respect and who bring a wide spectrum of knowledge, ideas, and viewpoints to the table. President Kennedy, after the Bay of Pigs disaster, instituted several changes on how his top team would make critical decisions going forward. This included not only candid debate to avoid groupthink, encouraging ideas to be challenged without reprisal, and gathering relevant information from outside sources to seek external validation, but also appointing a member of the team to take on the role of advocatus diaboli. The idea behind this role was to vigorously argue against contemplated courses of action in order to force the group to come up with alternative ideas. When the Cuban Missile crisis unfolded, Kennedy’s retooling of his advisor group’s decision-making process led to a successful outcome. This is, of course, in stark contrast to how many authoritarian or autocratic leaders bungled their response to Covid-19 through their denials, the suppression of dissenting opinions, and their tendency to surround themselves with sycophants – which explains why these leaders, for the most part, did such a terrible job of handling the crisis.
From the above, it might seem that what is needed most in an acute crisis situation is sound management and decision-making, not leadership. The opposite is true. Certainly, you need leaders who accept reality, keep an eye on performance metrics, and “do things right” – to quote from Warren Bennis’ famous list of distinctions between managers and leaders. But more than anything else, you need leaders who “do the right thing.”
Prof. Günter Stahl
They will deliver bad news and share inconvenient truths when they need to and are not afraid of making decisions that may be unpopular, regardless of whether the next election is looming or their job is at stake.
Capt. Crozier provides a case in point. After his direct superiors repeatedly denied his request that the vast majority of his crew be evacuated, he had the courage to make the decision he (and, in fact, many naval officers) believed to be the right one, even though he knew there would be repercussions for him personally for trying to get help for his crew. He did it anyway.
This example leads us to another important insight: in a crisis that takes a huge humanitarian toll, like Covid-19, leaders need to put people first. While it may sound obvious, crises are crises because people suffer. In a situation where emotions and anxieties run high, leaders need to connect with employees and other stakeholders, acknowledge the personal and professional challenges they are going through, and act as “Explainer in Chief.” Thoughtful, frequent, and empathetic communication signals that the leader cares and can help inspire confidence in people, especially if it is delivered with “bounded optimism” – hope combined with realism. Leaders need to send positive messages but resist the temptation to hide bad news and take an overconfident, upbeat tone. Showing excessive confidence and optimism in spite of obviously difficult or even deteriorating conditions raises suspicion and mistrust.
To sum up, effective crisis management requires qualities such as sound judgment, decisiveness, the ability to take quick action in the face of critical threats, and to execute decisions with conviction and calm resolve. Perhaps most importantly, it requires integrity, accountability, and moral courage. Crises reveal the true character of leaders and expose charlatans. During the Covid-19 crisis, we have seen many examples of leaders who took ownership, led by example, and showed empathy and authentic human concern, and others who failed miserably in this regard.
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