The importance of strong leadership to crisis survival

Slateford conducted research of the most significant crises in 2021 to identify common factors and key contributing issues when it comes to weathering the storm in a crisis.

What is it to be in charge of a reputation? To be the guardian of a company’s most valuable, intangible asset? And are leaders as mindful of growing that asset during their tenure as they might be in relation to tangible, quantifiable performance measures? What does it take to leave a company more reputationally secure than when you inherited it and is this endeavour given the bandwidth it deserves?

We can all spot good leadership when we see it, and individually we may all have our own personal business role models, but in a bid to offer some structure to the concept of reputational leadership, we undertook a study of the 20 greatest crises suffered by companies in 2021. Some companies survived the crisis, others did not, and in relation to some, the jury is still out. We created a timeline for each crisis, following through the story in order to break it down into its causal elements. Of course this was a little unscientific and had to do with broad themes but it helped to identify what was common to the most crises and therefore key contributing issues when it comes to weathering the storm.

Out of the 20 greatest crises, we found that poor leadership arose as a main contributory factor in 11. This presented itself sometimes as indecision, lack of clarity, unpreparedness, arrogance, a failure to look inwards, ignorance of stakeholder interests, greed, unethical/uninclusive motives, poor comms and lost credibility to name a few.

Whilst some of these features may come down to choosing the right leader, most of these issues can be addressed and eliminated in any candidate if we are mindful of them; taking these almost as a leadership checklist. For example, don’t undervalue preparedness for crisis, clarify exactly what the company stands for so that your decisions in its best interests can be clearly and quickly made and communicated, know your key stakeholders and – increasingly – try to do the right thing. This may not have been closely tied to profitable business in the past but increasingly, unethical businesses are being squeezed out of the marketplace or forced to reshape by consumers and investors.

The other perhaps unsurprising takeaway from the crisis research was that no one is immune. Private and public sectors, long-standing household names and start-ups, and a range of industries were all affected. There was no particular concentration of calamity as you potentially might be led to believe when you consider some of the “winners and losers” style reporting from during the pandemic.

Whatever your business, it is important to have a bespoke as opposed to a general view of risk. What are the particular risks that your company faces, as well as you as an individual leader? Where do you want to be in the future in terms of profile, growth, impact, markets and return? What are your priorities and how can you align those long term aims with the steps you take along the way? Knowing what the company stands for, what the stakeholders value and where it is going in the long term are all big components in building a stable, hardy brand, capable of weathering crisis. Investing in risk is always a hard sell but so important. Investing in aspirations pushes more at an open door; you will be used to spending your valuable time and energy in identifying workstreams and business development pipelines. The key to stability is to treat risk and aspiration as equally investable; the most consistently high performing companies prepare for both, to minimise risk disruption and maximise innovation gain. We are often brought in after a crisis hits, and that’s understandable. But how we would love to be brought in before that – and help avoid crisis more often!

As an effective leader, it’s important to have the self-awareness and ability to contextualise actions and decisions to make sure a gap between the expectation of others and the reality of what you’re doing is not opening, and the business is aware of what the objective reality is.

The ability to introspect, as a leader but also as part of a bigger leadership team, or if possible across the whole company, steadies the ship. We know not only from working with big established businesses, but also from our work with successful entrepreneurs, that introspection enables you to stay ahead of crisis in terms of ensuring alignment with your values, purpose, customer needs, ethical confidence, but also that it kickstarts that process of questioning the established and coming up with answers or solutions ahead of the problem.

To learn more about our crisis survival research, please contact us.

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