Embracing the Three Paradoxical Truths of Crisis Management

What executive does not dream of achieving a seemingly impossible task during a crisis? In practice, many executives and leaders lose their momentum and go through the wringer in such high-pressure situations.

Consider the COVID-19 pandemic: death rates skyrocketed, unemployment shattered records, and work and home lives were fractured. According to a survey of more than 3,500 CEOs from global leadership organizations YPO, 51 percent of CEOs characterize the COVID-19 crisis a large or severe risk to their business, with 11 percent saying their business is at risk of not surviving.

The widely held belief concerning crisis management—to act swiftly, prioritize survival, and spread positivity—are misunderstood or misinterpreted. Instead of warranting a rigid application, these guidelines must be counterbalanced by more profound and less popular principles. In times of a crisis, acting fast requires rigorous pause and reflection on the fly; a survival mode must be backed up by an innovation mindset; and, positive emotional contagion of hope and compassion must be balanced with realism and disciplines.

    1. THE SPEED PARADOX: ACTING FAST WHILE PAUSING ON THE FLY

Any crisis is a race against time. Acting fast to stop a looming catastrophe is the gold standard. I profoundly agree with this approach but caution against a speed paradox in which quickness is overemphasized and thinking or reflecting is downplayed. Consider this recent example: when the COVID-19 outbreak hit many states in February, U.S. authorities desperately attempted to obtain additional testing kits for the COVID-19 virus. The U.S. Centers for Disease Control and Prevention (CDC) provided states with tainted test kits that were themselves seeded with the virus. (Re)Acting too quickly may lead to problem solvers to accept false remedies, incorrectly rejecting the correct diagnosis, or overlook the deep root causes of the problems, or fail to come up with alternative contingency plans.

In a race against the pandemic, executives and managers may not outrun the virus per se, but can implement an alternative strategy to act and “think” — as Nobel economist Daniel Kahneman writes seminal, fast and slow with intended efforts.

In a race against the pandemic, executives and managers may not outrun the virus per se, but can implement an alternative strategy to act and “think” — as Nobel economist Daniel Kahneman writes seminal, fast and slow with intended efforts.

[To read more of Zhike Lei’s thought leadership click here]

2. THE SURVIVAL PARADOX: CRISES CONTAIN THE SEEDS TO SUCCESS

Organizational leaders constantly grapple with the tensions between short-term gains and long-term survival. Pandemics heighten these tensions to the maximum. The impulse to cut costs and let go of people is understandable. However, research shows that the benefits from the temporarily cuts are replaced by stress for the remaining employees and vanishes employee engagement; when the economy is back to normal, it creates extra costs to re-hire and retrain employees.

Executives and managers must focus on leveraging the available resources to enlarge or reinvent the pie. For example, if we look at the response of restaurants that were closed due to the coronavirus pandemic, many launched pickup or delivery services to stay afloat. In my own neighborhood in Los Angeles, Tesse, a highly claimed French restaurant in a normally vibrant city, converted its restaurant space into Tesse Market, selling farmers’ fruits and vegetables, fresh bread, meats and cheeses (made at the restaurant), and plenty of paper goods including paper towels, gloves, and toilet paper.  A forward-thinking mindset and a habitual practice of innovation are the catalyst of success before, during and after a crisis.

    3. THE POSITIVITY PARADOX: REPOSITIONING “KEEP CALM AND CARRY ON”

Keeping feelings of hope, maintaining positive interactions — even if virtual, and purposefully expressing optimism, compassion, and gratitude, can help individuals cope with shocks, crises and boost long-term well-being. Savvy leaders should demonstrate care, empathy, support and make employees feel safe and motivated to continue working in the uncertain times. The caveat is that positivity requires disciples and realism. Gary Burnison, CEO of Korn Ferry, shares how in uncertain times people turn to leaders for definitive answers, sometimes humility, bravado and humility are the best ways to get to the solution.

[For more on Pepperdine Graziadio’s approach to Leadership click here]

The idea that positive emotion contagion is a balancing act, or what I call the positivity paradox, is not a new one. But it has yet to be given a front-and-center role in discussing crisis management. Leaders need to be very transparent about the hard realities and the uncomfortable disciplines still required. A case in point is California Gov. Gavin Newsom, who has been using the daily press conference on the Covid-19 outbreak to instill calm, optimism and hope. At the very point of being pressed hard in May on the question of “when” California would begin to reopen, Gov. Newsom was candid and optimistic: “I wish I could prescribe a specific date to say we could turn on the light switch and go back to normalcy…there is no light switch and there is no date.” He later added, “I can assure you those decisions will be forthcoming and will be based upon science, data, and the spread of the virus.” Noticeable in Gov. Newsom’s approach is what management expert Jim Collins refers to as the dual need for hope and pragmatism. I would go a step further and describe this as the “triple facets of positivity”—hope, discipline, and realism.

Unless the tensions created by the speed, survival, and positivity paradoxes are carefully managed, executives and leaders’ attempts to survive and succeed through and after a crisis will fail. Keeping the three paradoxes of crisis management top of mind, executives and leaders must never confuse hope and a vision of that which shall ultimately prevail with the discipline to confront the most brutal facts of the current reality, whatever they might be.


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