It may not happen suddenly; it can smolder for years. 

It may not be shock and awe, but can still derail your company.

And it can happen in ANY organization (even schools, non-profits and charities). It can happen to YOUR organization. So… how exactly do you know whether your organization’s problem is a crisis or just an everyday bump in the road?

I use this definition, from the Institute for Crisis Management: a business crisis is “any problem which triggers negative stakeholder reactions that impact the organization’s business and financial strength.”

A crisis can entail any or all of these things: it threatens or damages sales, profits, or company reputation; it weakens the organization’s competitive position or drives down the stock price; it impacts jobs and delivers a blow to employee morale. It may trigger litigation, government investigations, or consumer or investor action.

But not every business problem is a crisis. How about these examples?

A few customers are complaining about our company on our Facebook page.
PROBABLY NOT- We contacted them, addressed their issues quickly and resolved the problem to their satisfaction. We left their posts on the page, and posted our resolution for others to read.
MAYBE- The posts have gone viral in a few hours, the rhetoric is becoming more inflammatory, and several hundred people have added their complaints.

One of our trucks has been in a bad accident. What happened?
PROBABLY NOT- It was hauling the new model prototype, which has been damaged.
YES- Other motorists were critically injured and authorities have arrested the truck driver for DUI. Again.

There are OSHA inspectors in the lobby. What do they want?
PROBABLY- Someone tipped them off about the accident and safety problems in the plant.
YES- There is also a local TV news reporter and cameraman with them.

The old adage about an ounce of prevention and a pound of cure is true: it is easier (and much less costly) to PREPARE & PREVENT than it is to REPAIR & REPENT.