A New Level of Leadership

In times of crisis, CEOs should be visible and in touch with employees. They also need to have effective contingency plans in place

By Don MacRae

A powerful leadership role in the "first war of the 21st century" has fallen squarely on the shoulders of corporate chieftains. Why? Because on Sept. 11, terrorism came to America, setting a new baseline for depravity while destroying New York's World Trade Center office towers and parts of the Pentagon, along with the lives of thousands of innocent people and the heroes who tried to rescue them.

The federal government has stepped up to direct America's response to this atrocity. Now, corporate leaders must rise to the challenge, too. They need to counsel employees in their grief and confusion, while at the same time steering their businesses through a poor economic period that the attacks have made more treacherous.

There are many role models to turn to for inspiration. For the past two weeks, we've watched New York City Mayor Rudolph Giuliani -- beset by his own health and personal problems -- stand daily as a pillar of strength. We watched Cantor Fitzgerald Chairman Howard Lutnick reassure the families of the hundreds of employees his firm lost in the tragedy. Lutnick's brother Gary is among the missing.


  Within hours of the disaster and in the days that followed, many corporate leaders huddled with their crisis-management teams, which usually consist of the operating committee and department heads from legal affairs, human resources, corporate communications, and security. These teams likely reviewed every aspect of the business and how it had been affected by the catastrophe. They looked at how hard revenues would be hit and whether supply chains would be disrupted in the weeks ahead. Undoubtedly, they reviewed security and travel policies, as well as ways to counsel employees who were dealing with both grief and newly surfaced fears.

Many CEOs set the tone quickly. They sent e-mail and voice-mail messages to their staffs, explaining how the events would affect employees, the business, and its customers. They gave clear direction on how the business would operate and clarified new security procedures. They made sure that grieving employees had someone to talk to who could help them cope with the situation. As business started to resume, CEOs praised their staffs for their hard work and dedication in these trying times. Above all, they were visible -- visiting employees in offices and holding Web conferences with staffers in distant locations.

The majority of CEOs have done very well at what we might call the easy part. What comes next will be much harder: Setting a course and an example that will strengthen their companies and inspire their employees in a world where much has changed -- or at least, perceptions have changed. It seems that corporate leaders have a duty to get political and talk about the very real threat of terrorism with their employees. They need to prepare their staffs to forego conveniences that they've long taken for granted, like breezing through an office lobby without flashing an ID card to anyone.


  Much more needs to be done in the weeks and months ahead. For one, corporate leaders have to change their collective attitude about defensive systems. It costs money to protect employees, buildings, and brand names. But since protecting these assets doesn't produce any revenue, such matters have been low on the priority list -- if on it at all. That has to be reconsidered.

I spoke with Ted Price, managing director of Kroll Crisis Management in Washington, D.C., and a former deputy director of operations at the CIA, about what CEOs should be thinking about for the immediate future. Crisis-management priorities differ from industry to industry, he says, but a few things should be high on everyone's list.

Any crisis situation -- whether it's caused by workplace violence, a kidnapping, or a terrorist attack -- calls for immediate action. Do you have an evacuation plan to get people out of a building or a country? Are search and emergency procedures in place to deal with bomb threats? Say one of your executives gets kidnapped. Do you have procedures for dealing with extortion?


  It isn't just people who must be defended in an emergency. CEOs need to also review and upgrade their data-security measures to safeguard intellectual property and other company assets. You might also need to beef up security around office buildings and manufacturing plants, particularly in areas of the world where civil unrest runs high.

An assessment of the company's public image may be necessary too. Ads that worked fine before Sept. 11 may be completely inappropriate now. In some industries, including the airline business, companies will have to overhaul their marketing strategies to reflect the new reality.

Unfortunately, some CEOs will never get to this stage of the recovery process. They haven't even figured out the easy part yet. Such supposed leaders have provided little more than cursory support to their organizations. Many don't have a crisis team or a contingency plan to deal with such events. Maybe they've sent out an e-mail that expressed their sorrow over the disaster, but that's about it. Instead of giving the direction that their workforce desperately needs right now, they've dropped the ball.


  This is inappropriate and unacceptable. As German doctor and humanitarian Albert Schweitzer once said: "Example is not the main thing in influencing others, it is the only thing." For starters, every corporate chief can set that example by contributing to the charities that have sprung up to support families who've lost loved ones in the terrorist attacks. Many of America's leading companies -- General Electric, Cisco, and DuPont, to name a few -- have already done so. They can also show tolerance and call on their employees to respect each other's differences.

As the past few weeks have shown us, being a corporate leader means much more than just managing the bottom line. It's also about being visible to your organization in times of fear and worry. It means giving your staff the information and support they need to serve their country and their organization effectively. To their credit, many CEOS have assumed this mantle. Others have not. For them, I have some simple advice: Lead -- or get out of the way.

MacRae is president of the Lachlan Group in Toronto, Canada. He has taught and worked with corporate leaders for the past 25 years. You can reach him at don@lachlangroup.com or visit his Web site at www.lachlangroup.com