In a recent survey, board members around the world were confident in their organizations’ ability to handle crisis situations – but less than half of them are actually evaluating key crisis scenarios!
The Deloitte/Forbes survey polled 317 non-executive board members to get their take on the state of crisis readiness in large organizations (companies with annual revenues from $500 million to $20 billion USD). The results show a “vulnerability gap” between perceived and actual crisis readiness.
This is especially true at bigger companies. Overall, 62% of companies are confident in their organization’s crisis management capabilities – but for companies with over $10 billion in revenue, that percentage climbs to 82%.
But the reality is most key steps for crisis prep are getting ignored at half of these companies:
- 50% evaluated key crisis scenarios
- 50% evaluated strengths/weaknesses/opportunities/threats
- 49% identified relevant stakeholders
- 46% engaged multifunctional teams
- 43% evaluated worst-case scenarios, and
- 41% Engaged stakeholders in analysis of specific scenarios.
The gap between crisis planning and vulnerability is most pronounced when it comes to:
- Terrorism/manmade disasters (45%)
- Rumors (though false) (42%)
- Chemical, biological, radiological, nuclear crisis (42%)
- Corporate Reputation (34%), and
- Product tampering (34%).
To close this gap, the report recommends deeper involvement across the board: building crisis capabilities into the structure of the board, building crisis awareness into everyone’s job description, and embracing the board’s role as “guardian of reputation,” to start.
Read the full report here.