Crisis Management Strategies

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A crisis exit strategy is a plan that contains tasks and the time for their implementation. Let's look at several examples of anti-crisis strategies.

"Electric Shock"
This strategy is associated with great risk, since it does not correspond to the usual logic, according to which it is necessary to reduce expenses. Usually, during a crisis, companies us companies board of directors email list reduce their staff, reduce production costs and marketing activities.

The peculiarity of this anti-crisis management strategy is that expenses in critical areas, on the contrary, increase. For example: the manager decides to raise the wages of employees, they become motivated to work and productivity increases.

"Manual control"
Sometimes, poor financial performance of a company is the result of poor internal control. The goal of this strategy is to tighten supervision. The owners of the organizations take control of the management and participate in all key decisions until the company emerges from the crisis.

"Optimal reporting"
In this case, business processes are optimized through procedures related to the creation of management (internal) reports. Reporting documents must fully reflect the state of affairs in the company and immediately show where there are problems.

"Optimal reporting"

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If this is not the case, it is necessary to optimize reporting forms, change calculation methods and indicators in order to receive objective information about the company's work in a timely manner and find problems. The key role in this is given to indicators of cash flow and profitability.

"Time compression"
This method of crisis management is based on the prompt development of anti-crisis measures and their rapid testing in real conditions. For this reason, it is important to use shorter periods of internal reports to make decisions and adjust them if necessary.

"Extreme Step"
This is an appeal to creditors for additional resources. This measure is necessary when the company does not have enough of its own potential to get out of the crisis. This decision is risky, but only attracting additional funds will allow the enterprise to return to normal operations.

How do you know that the strategy you are using is producing the desired effect? ​​Earlier, when describing the stages of anti-crisis management, we said that the tactics of overcoming an exacerbation require constant monitoring. You need to check the stages, deadlines, and results. As a result, you can understand how effectively the chosen strategy works:

If everything goes according to plan and the company successfully overcomes the crisis, they continue to act in accordance with the chosen tactics.

If the strategy used does not produce the expected effect, it is either changed or replaced with another.

It is necessary to begin monitoring the implementation of the crisis exit strategy as early as possible and assess the effect it has.