Crisis leadership is essential

Everyone can agree that strong leadership is critical in a crisis, but it is hard to find two people who define leadership the same way. Leadership is a trendy topic among business school professors.

Everyone can agree that strong leadership is critical in a crisis, but it is hard to find two people who define leadership the same way.

Leadership is a trendy topic among business school professors. If you study the performance of large organizations, there are often large “unexplained” differences in performance after the statisticians strip away differences in industry, size, technology spending, market position and other potential explanatory factors.

This leaves the hard-to-measure residual factors, and the quality of leadership is one of the big variables that statisticians can’t measure.

Crisis leadership is especially important. A poorly handled crisis can be disastrous for the organization’s clients, employees, shareholders and other stakeholders. It can even mean doom for the organization itself.

The recent flood in Calgary and rail disaster in Lac-Megantic give us two very different case studies in crisis leadership. Calgary’s mayor, Naheed Nenshi, faced the worst flooding in the city’s history. Edward Burkhardt, chairman of Montreal, Maine & Atlantic Railway (MM&A), woke up to discover that one of his company’s oil trains had blown up in the middle of a small town.

As soon as the flood hit, Nenshi was out of his office and on the street. From early morning to late at night, he seemed to be everywhere. He gave press conferences, tweeted incessantly and visited emergency crews.

He told Reuters that a mayor has three jobs in a crisis: “No. 1 is to make sure citizens have a lot of information on how to keep themselves safe. No. 2 is provide encouragement and resources to the real heroes. And No. 3 is to get out of the way and let people do their work.”

MM&A has taken a different approach. The company quickly had a dozen people on the ground, including the chief executive. But they kept a low profile and Burkhardt, the ultimate boss, wasn’t there. The disaster happened early Saturday morning, but according to newspapers in the region no one from the company appeared to speak in public until Monday at 5 p.m. They issued two press releases, but translated them poorly into French.

Nenshi’s performance has been widely applauded, while Lac-Megantic disaster victims and local leaders are lambasting MM&A.

A few lessons come out of this for corporate and government bosses.

The first is presence and visibility. People want to see the captain on the bridge, not in his or her office doing paperwork (or partying with Romanian models, as allegedly was the case with a recent cruise ship accident). While people mock politicians for being attracted to disaster sites like mosquitoes to a freshly arrived tourist, it is important that the boss be seen to care and to be in control.

Talking to lots of people also keeps the leader in touch with events on the ground, rather than relying on reports filtered through layers of mid-managers.

Secondly, effective crisis leaders step up their communications. In a crisis, people are desperate for information. Leaders need to use their position to help get important facts and messages to the populace. It is not good enough to give a lot of vacant speeches saying everything will be OK. The leader must find out what people need to know, either for their own safety or to help emergency teams, and pass that on.

Nenshi’s focus on communicating what Calgarians needed to know to stay safe is a good example.

Leaders must also be careful not to distract and divide while crises are underway, even if tempted to use the crisis to their advantage or prepare for subsequent litigation. Suggestions that seemed to emanate from MM&A that a nearby fire department may have caused the train to start rolling out of control appear to have been counterproductive. And federal NDP leader Thomas Mulcair, who quickly jumped on the accident to criticize rail safety cuts by the federal government, was also criticized harshly as premature political point scoring. Federal cuts may turn out to have been a contributing factor, but there could have been other causes and we won’t know the facts until investigators do their work.

Third, staying positive is important. No one wants to follow a negative person. MM&A’s chairman, announcing that he would visit Lac-Megantic, said, “I hope I don’t get shot at.”

Positive leaders can improve the performance of their teams by reassuring them that the crisis is being brought under control and inspiring them to keep working hard. This doesn’t always mean giving rah-rah speeches. I recall another nautical anecdote about a submarine captain whose boat was undergoing a severe enemy depth-charging. There being nothing he could do to make his submarine go faster or deeper at that point, he pulled out a book on the bridge and began to read.

The captain’s sang-froid reassured the crew, who continued with their duties. Only one of the crew noticed the captain was holding his book upside down, presumably too terrified to actually read.

Finally, effective crisis leaders know where they can make a difference. They leave the front-line decisions to front-line managers, and instead focus on ensuring the organization’s resources are fully mobilized, any bureaucratic barriers are broken down and the communications strategy is keeping everyone engaged and on task. As the chief spokesperson to external audiences, it is also up to the boss to secure the co-operation of partners and other levels of government.

New Jersey Republican Governor Chris Christie famously did this after Hurricane Sandy, inviting the Democratic president to New Jersey and encouraging him to deliver the full package of federal support. This is something that the governor of Louisiana, for one reason or another, failed to do with President Bush during Hurricane Katrina.

Crises are rare, and leaders seldom have much experience to draw on when they happen. Nenshi’s crisp description of a mayor’s crisis duties suggest he had thought about it in advance and prepared himself. There are plenty of leaders who have not, and the disaster in Lac-Megantic may give us a case study of what happens then.

Keith Halliday is a Yukon economist and author of the MacBride Museum’s Aurore of the Yukon series of historical children’s adventure novels. You can follow him on Twitter @hallidaykeith