Dealing with Disaster: A How-To Guide
By Robert Rosenberg
It's almost a cliché to say that the world has changed since September 11. But one of the most striking differences in the U.S. is a renewed respect for those in the public sector, which goes beyond the current veneration of firefighters and police officers.
This startling change comes after decades of viewing public servants as objects of pity at best or derision at worst. Yet these days, executives are more likely to quote Rudy Giuliani than Jack Welch.
It's not surprising, then, that at this critical juncture for Corporate America a spate of books by former politicians and public servants has arrived with tips and strategies for managing crises. Among the more promising is Stronger in the Broken Places by James Lee Witt, a former Federal Emergency Management Agency director, and veteran writer James Morgan.
Stronger in the Broken Places (Times Books, $25.00, 241 pp) draws on Witt's experiences in his seven years at FEMA. Appointed to the agency in 1993 by former President Bill Clinton, Witt inherited an organization in disarray. In fact, many in government joked that the agency itself ought to be declared a disaster zone.
Over the years, FEMA, which was originally created to guard against the effects of nuclear war, had lost its initial mission and become a dumping site for political appointees. In the wake of its disastrous performances in 1989, when Hurricane Hugo wiped out large swaths of South Carolina, and then in 1992, when Hurricane Andrew destroyed South Florida, outraged politicians called for the agency to be dismantled.
So Witt arrived from Arkansas and made it his mission to transform FEMA. He found that it had no overriding strategic plan and had never tried to establish goals or redefine itself. He helped shift thinking away from mere disaster management toward four clearly defined areas: response, recovery, preparedness, mitigation. To Witt, the most important of the four was mitigation -- to lessen the pain of the disaster, which should be the goal of all crisis managers.
KNOW YOUR VALUES.
Beginning with the wildfires that swept the Los Angeles area in 1993, the crises are presented in chronological order and range from fires, storms, and earthquakes of biblical proportions to the manmade catastrophe of the Oklahoma City bombing. Each tale gets its own chapter, with each making a different point. The first chapter, "Finding Your Roots," is about a family's reaction to the 1993 California fires. Focusing on a core value -- survival -- the family escapes the blaze but loses everything it owns.
Knowing one's core values, says Witt, is equally, if not more important to corporate managers. He gives high grades to Johnson & Johnson, which faced a crisis in 1982 when eight people in Chicago died as a result of cyanide-laced Tylenol. At the time the event caused as much fear and terror as the Beltway sniper has recently and the anthrax-tainted letters did a year ago.
J&J immediately pulled all Tylenol bottles off the shelves and redesigned the containers to make them tamper-proof. These actions cost J&J $240 million, but they saved the brand and enhanced the company's image. While the bottom line is important to any business, "making the right decisions," says Witt of J&J's reaction, "was the right decision for their business." J&J retained public confidence and trust by acting swiftly, rather than trying to stonewall.
NOT ABOVE CRITICISM.
How valuable are Witt's lessons, and how applicable are they to companies? Much of his advice -- knowing the bedrock of your company's values, communicating effectively, recognizing current weaknesses, maintaining morale -- is common sense. And arguably, the mandate of a public agency such as FEMA, to serve the people and maintain safety, is quite different from that of a public company, which is to serve its shareholders and maintain profits. Also, the agency he helped rebuild isn't above criticism. Many would argue that FEMA didn't measure up to the massive emergency of September 11, that it was precisely in the area of mitigation that FEMA failed.
Still, managers and execs can gain important tips from a man whose job was responding to crisis and disaster. And certainly, Corporate America could be described as a disaster zone. Whole swaths of the economy lie in tatters after the excesses of the 1990s. Corporate chiefs and boards seem unnerved by uncertainty to the point of paralysis. Accounting scandals, not-so-petty thievery by overpaid and extravagant CEOs, and continuing revelations of questionable business practices at WorldCom, Enron, and Tyco have shaken investor confidence.
Business is broken in many places and could use some homespun wisdom to heal itself. Witt's book is an intelligent guide for those CEOs who must prepare for a world sure to be filled with natural, as well as manmade, catastrophes.
Rosenberg is deputy chief of BusinessWeek's production copy editors
Edited by Patricia O'Connell