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Handle Crises Constructively

However effective you are as a team leader there is no way of avoiding periodic crises such as the loss of a major client, a significant business downturn, the loss of a highly competent colleague to a competitive firm or unethical or inappropriate conduct on the part of a team member.

When facing any business crisis there are three useful tips to bear in mind. The first is to ascertain the facts, distinguish causes and effects and identify the implications. The second is to decide whether you can handle the crisis alone or if you should involve other team members or colleagues elsewhere in the firm. The third is to pay particular attention to getting the communications right.

Let us look at these in a little more detail. The first step in crisis management is to identify the facts and separate these from rumours and conjecture. A particularly important task is assessing the implications of the crisis. If your team loses a major client, for example, there may be several consequences beyond the loss of fee income. Morale of colleagues could be badly affected. Other clients may hear about the loss and they may lose confidence in your team and take their business elsewhere. One of the hardest but necessary jobs is to face up honestly to the root cause of the problem. Maybe the loss of a long-standing valued client is due to complacency. Perhaps the team has taken the client for granted. Maybe you have neglected to nurture the client and provide first-class service in some way.

The second step is to decide whether you should handle the crisis personally or involve other colleagues inside or outside the team. If one of your team members has been accused of sexual harassment, for instance, you will probably wish to involve a human resources professional. The threatened defection of a major client might be avoided by a visit from the senior or managing partner. Occasionally, team leaders make the mistake of keeping a crisis to themselves because they fear that their reputations might suffer if information leaks out. More often than not the problem becomes generally known sooner or later and in the meantime they have lost the opportunity of involving others who can provide help.

The third step is to get the communications right. It is much more sensible to be open with your team members about the facts of a crisis and the way that it is being handled rather than trying to hide the details. Generally speaking, people are very quick to detect that something is seriously wrong even when they are not told about it. The problem with team members picking up and discussing scraps of information is that the issue becomes distorted and is surrounded with rumours and conjecture. It is crucial for you to be available during a crisis so that your team members can express their concerns, offer their views and seek your advice or reassurance. Being accessible is always important for team leaders but is especially so when things are going wrong.

Here are a few more tips for handling specific crises:

  1. If you lose a valued client tell all of your team members what is both known and not known about the reasons for losing the client at the earliest opportunity. Have a team discussion to analyse what went wrong. Explore how to avoid a similar loss in the future. Hold a brainstorming session to generate ideas for improving service quality to all other clients. Lift morale by reminding the team of its strengths. Share responsibility with your team members for the loss of the client and avoid allocating blame.
  2. If there is a significant business downturn that results in redundancies then tell the remaining team members the facts and help them to face up to the realities of the situation. Have brainstorming sessions with your colleagues to produce ideas for generating more business during the difficult times. Get everyone to contribute his or her thinking. This will have two benefits. You are almost certain to get some good ideas, and morale will be lifted among team members because everyone will be taking some positive actions. As things improve, acknowledge the assistance that everyone has given to helping the team through the crisis.
  3. If a highly valued colleague decides to leave and join a competitor then have a chat with the person concerned. If the reason for leaving is for career advancement or for a more lucrative income then agree how clients and colleagues should be informed and what they should be told. Maintain a good relationship and wish your colleague well for the future. Parting on amicable terms is important. Your excolleague will almost certainly talk about you and your firm to his or her new colleagues and clients. If the reason for leaving is a feeling of being undervalued it may be possible to provide reassurance and you might be able to effect a change of mind. Be careful, however, not to promise special treatment. Team colleagues may regard this as inequitable. That could produce a significant deterioration in morale and performance in the rest of the team.
  4. If one of your team members seriously breaches the code of ethics of the profession or of the firm or behaves unlawfully then the required course of action is usually evident from disciplinary rules and regulations. Because it is an unpleasant task, some team leaders procrastinate. It is crucial, however, to take the designated action immediately. Everyone needs to know what sort of behaviour is unacceptable, what the penalties are and that action will be taken if there is a serious breach of codes or rules. If the offence is so serious that the person concerned has to leave the firm then the facts should be communicated to team colleagues to avoid rumours and conjecture.
  5. Occasionally team members make significant mistakes that do not warrant disciplinary action. They may be errors of judgement or forgetfulness. It is helpful for team leaders to let everyone know that if that happens the best policy is to own up and learn rather than cover up. Most of us are willing to forgive if people are genuinely sorry and are willing to learn.