CM Lecture 2

Management > Crisis Management > 3 perspectives > Interdependence of the 3 models > Crisis and learning > Slatter's recovery > Meyer's 9 causes of failure > Hoffman's turnaround strategies > Discussion > Invulnerability Syndrome

Invulnerability Syndrome

The problem that many firms face is the invulnerability syndrome, where successful firm feel invulnerable until it is too late. The diagram below summarises some causes of this syndrome.

Financial Strength. In some cases a firm feels it is financially sound enough to deal with any crisis, or believes that the fact that it is so wealthy means that crises will not occur. In some cases, companies will not invest resources in unlikely events.

Dominance in the market. It seems that the more dominant a company in the marketplace, the less willing it is to continue learning.

Supporting institutions. If a government intervenes too much, it can make an organisation feel invulnerable.

Strong Reputation. If a company has spent much time and money on building up its brand image, it may not want to consider investing in Crisis Management.

All firms need to take a fresh look at Crisis Management, with the CEO and CMTs working together and looking both externally and internally.