A terrorist attack, a high-profile kidnapping, political insurgency, an extortion threat. If you operate in emerging or unstable environments, these are just some of the problems you might be exposed to on a daily basis.
These issues could affect your people, your assets and/or your contracts, and all of them have a significant impact on your business operations.
“Some of the risk can be transferred, but insurance is only one part of the solution,” says Kevin Garvey, account executive at Aon Risk Services Inc.
What’s more important, says Garvey, is how you respond to such a crisis. One wrong move could have a critical impact on your reputation. And, if you lose the confidence of your customers and investors, it could be very difficult for your business to recover.
Smart Business spoke to Garvey about how a crisis management system can help organizations understand their exposures and help mitigate those risks.
How does an organization go about putting a ‘crisis management plan’ into place?
Before putting effective plans in place, organizations need to fully understand their risks. A team of specialist crisis consultants can help quantify exposure by reviewing an organization’s business in each operating territory. It can then assess the threats and vulnerabilities in order to improve resilience and audit the strategic approach to the treatment of security risk, which will support corporate governance and duty of care.
Look for a risk management firm that can provide a flexible consulting approach that is tailor-made to fit your organization’s business operations. Those services enable you to make informed decisions around how much risk to transfer and how much to retain and manage. A good risk management firm can formulate plans and procedures to mitigate the exposure as much as possible.
How does a crisis management team assess and mitigate risks?
Planning ahead is absolutely necessary. Companies that spend time on contingency planning can respond to crisis in a structured way. But before putting any type of plan into place, an organization must assess its risks.
Is there a credible terrorist threat in the areas in which you operate and do your security procedures leave you exposed? Does your travel policy protect your employees, or are they in high-risk countries uninformed and untracked? The process of assessing risk highlights weaknesses and areas where improvements can be made.
Planning does not only aid in recovery, it also may prevent a crisis from happening in the first place. With the appropriate security procedures in place, you will be a less attractive target for terrorists. If your employees are given proper advice and protection, they will be less vulnerable to attacks. And if you monitor the security situation in your operating territories, there is less chance of a deterioration turning into an emergency.