CRISIS MANAGEMENT 2107

1. CRISIS MANAGEMENT2107 Steven C Seideman Extension Food Processing Specialist Cooperative Extension Service University of Arkansas

2. PURPOSE This series is designed to help food processing companies develop and implement a CrisisManagement Plan that addresses all possible crises that can arise. The suggestions contained herein are very general. Each food processing company should design a crisis management plan that addresses its particular products and overall organization.

3. INTRODUCTION • A “Crisis” can be defined as those unexpected events, whether of human or a natural catastrophe, that can cause a food plant to close or otherwise interfere with the normal course of business, or that can cause the public to lose its trust in an entire company.

4. INTRODUCTION • Crises has become a reality in today’s food processing companies ranging from microbiological food poisoning to product tampering. These crisis situations lead to loses of markets, legal lawsuits and can virtually ruin a food company.

5. Even through food related crises cannot be prevented, they can be MANAGED

6. EXAMPLES OF RECENT FOOD RELATED CRISIS EVENTS • Poison in Tylenol bottles • Glass in baby foods • Recalls of ground beef with E Coli 0157:H7 • Sara Lee processed meats with Listeria Monocytogenes. • McDonald’s “Hot Coffee” and “Obese Adolescent Children”. • Jack In The Box- E.Coli 0157;H7.

7. CRISIS EVENTS • Although none of these crises were intentional and usually not even known to the parent food company when it happened, they still can have deleterious effects on the future of the business.

8. CRISIS EVENTS • By anticipating and detailed planning for a crisis before it happens can drastically minimize it’s ultimate effects on the company. • “Failing to plan is like planning to fail” • “The best defense is a strong offense”

9. Situation • You are the President of XYZ Food Company and you are walking to your car at the end of the day. A news reporter comes up to you and says “Several people in Wayne AR have just become seriously ill and have implicated your food product. Would you care to comment?” How would you respond?

10. OPTIONS • How would you respond?; A) Tell the reporter “Sounds like a personal problem to me”. B)Tell him you don’t have time to talk to him now because you are tired. C)Tell him “No comment” D)Tell him you are sorry about the whole incident and you will launch a full investigation. E)Tell him that you think the liberal media probably staged the whole thing to get a good story.

11. CORRECT ANSWER • Answer D is by far the best answer if you have thought it through. Answer C is not too bad either. After any major problem, all the public expects to hear is concern for the victims and that the company is doing something (investigating, making restitution, cleaning up the mess etc).

12. THE POINT • The point of this story is that by preparing for a wide range of crises, a company will know how to respond to it. The President of XYZ Foods may not have been aware of the crisis but he had been trained to know what people expect. • It has been repeatedly shown that all the general public expects for the first few days after a crisis is concern for the victims and to state that some action will be taken.

13. Crisis Management • This series will help you get started into crisis management training and through a crisis management unit, anticipate and plan details on how to respond to any possible situation that arises.

14. Crisis Planning • Although every crisis will be disruptive and unpredictable in various aspects and degrees, it is possible to anticipate many of the decisions that will have to be made during a corporate crisis. By outlining in advance the precise steps that corporate management and other personnel are to address in identified crisis situations (who is to do what and how they are to do it) the ability of a company to respond efficiently and effectively is greatly enhanced.

15. Crisis Planning • Data suggests that the more potential crises an organization can think of beforehand and prepare for (whether it can completely prevent them or not), the more quickly and successfully it will recover from any crisis that happens.

16. Crisis Planning • Many potential crises can be prepared for in advance since many crises send out a repeated and persistent trail of early warning signals. If one can identify the potential problems and plan for them, the probability of a successful recovery will be greater.

17. THE STEPS IN CRISIS MANAGEMENT • Step #1; Form a Crisis Management Unit. • Step#2; Make a list of all possible crises one can think of. • Step #3: Write out an action plan for each of the possible crises listed in #2. • Step #4; Publish and distribute a Crisis Management booklet to all responsible parties.

18. Let’s discuss each of these steps in greater detail

19. Step #1; Form a Crisis Management Unit • Referred to as the CMU (Crisis Management Unit). • This unit is composed of key management personnel who direct a crisis. • The CMU is a group of managers that serve to direct a crisis into a more favorable situation or minimize its deleterious effects.

20. Forming a Crisis Management Unit • The group is made up of members from various departments who can rapidly respond to a situation, communicate with individuals, internal and external to the company, be responsible for determining the details of a crisis, identifying needs and ultimately controlling the situation. • The president or plant manager will ultimately have to appoint a CMU committee since every plant and peoples personality vary greatly.

22. Title Plant Manager or VP Operations HR Manager QA Manager R&D Person Maintenance Manager Shipping Supervisor Responsibility Director of the CMU Spokesperson Assist in recalls Assist in technical issues Assist with engineering problems Assist with recalls The CMU Team

23. The CMU Team • Since every company varies in its products and personalities, teams must be constructed of the right people and assigned responsibilities commensurate with their talents. • Additional members may be sales, the safety director, marketing, HAZMAT team leader, First Responders team leader etc.

24. Two teams all plants should have • Every food processing plant should have a HAZMAT team and a First Responders team. • The HAZMAT team are usually maintenance people who are trained to handle HAZARDOUS MATERIAL in the plant such as ammonia, chemical spills, etc. • First Responders are the plants “first aid “people who are volunteers and trained to respond to emergency situations.

25. Why Bioterrorism • Poor man’s nuclear arsenal • Used against living organisms • Plants • Animals • Discussions have been primarily centered around humans • Why not against livestock

26. HAZMAT AND FIRST RESPONDERS • Although I have never been on either of these teams, I have personally witnessed both groups save people’s lives. • If you have ever seen these teams in action that are well trained, disciplined and cool in a crisis, you will never forget their importance.

27. CMU RESPONSIBILITIES • Each team must have a director and alternate director. • Each team needs to have a spokes-person for communicating with TV, radio and the press. This person has to determine when and the amount of media coverage and when and how to keep the employees informed of a crisis. No other person at the plant or any member of the CMU should ever discuss any matters with members of the media no matter what happens. This can be real important.

28. CMU RESPONSIBILITIES • The Technical person and QA Manager may be one in the same. They are on the team for purposes of advising in technical matters, recalls, laboratory analysis and other food safety issues. • Maintenance and shipping supervisors are on the team to handle matters concerning their respective departments area of expertise.

29. CRISIS EVENTS • No matter what the crisis, there are a series of characteristics/events that take place. • The CMU must realize these characteristics exist and control the situation.

30. Characteristic/Event 1) Surprise 2)Insufficient information 3)Escalating flow of events CMU Response 1)Collect the CMU and assign tasks. 2)Collect factual data. Make necessary comment to the media. 3)CMU should have control by now. Facts about the crisis should be known CRISIS CHARACTERISTICS

31. 4)Loss of Control 5)Intense scrutiny from outside. 6)Siege mentality 7)Panic 8)Short term focus 5)Work through the media to keep a good company image. 8)Keep CMU on the right track of fixing the original problem CRISIS CHARACTERISTICS

32. CRISIS CHARACTERISTICS • The previous 8 steps will happen no matter what the crisis and will proceed in that order unless the CMU can stop it at any of the 8 steps. • All 8 of these steps usually happen in the first 3-5 days of a crisis.

33. Step #2; List Possible Types of Crises • Crises can be divided into 2 types. *Those that are plant or local. *Those that require Corporate input. If you are a small company, these are one in the same.

34. Plant and Local Crises • These types of crises are local in nature and involve an expanded CMU structure, are local in media coverage and only require corporate knowledge of the crisis.

35. Crisis Requiring Corporate Input • These crises are ones that effect the corporation because of potential media coverage. • They are also characterized as ones where the product has physically left the production facility.

36. Local Ammonia leaks Bomb threats Fires Explosions Power outages Tornados Corporate Adulteration/Tampering Food poisoning Bioterrorism Recalls TYPES OF CRISES

37. UPDATE • Up to this point: 1) You have identified a CMU team and clearly identified the responsibilities of each of the members. 2)You have made a list of all possible crises that can possible happen. Now you are ready to go through each potential crisis and write down what the action steps will be taken if it were to happen.

38. Step #3; Write out an action plan for each possible crisis • This may seem overly simple as you do it but it is real important to detail it while you are calm and thinking. When a real crisis comes along, you will probably be surprised, in shock and extremely distracted so your thinking will be powered by emotion rather than logic.

39. Step # 3; Action Planning • Have some fun with this one. Take one possible crisis at a time and think of every possible way to handle using brainstorming and creativity techniques. • Remember that it is always better to be “proactive” to a crisis where the CMU has thought it through rather than being “reactive” where you are acting out of emotion.

40. In Planning for a Crisis • REMEMBER DETAIL DETAIL DETAIL “The success to which one achieves in direct proportion to their dedication to excellence” You must be dedicated to the excellence of planning for the Crisis.

41. Step #3; Action Planning • We will now go through each of the general crises with some thoughts on them. The following are not action plans by a few comments about the crisis that should be considered as the CMU writes the action plan. • It is up to the CMU to write out a detailed action plan on each of these that can be distributed throughout the company.

42. Ammonia Leaks • When an ammonia leak is detected by sensors or smell, the HAZMAT team and First Responders should be summoned. • All other employees should be evacuated from the area. • After the HAZMAT team has collected information as to where the leak is and the how it happened, the CMU can be briefed on the situation and decide what steps to take.

43. Bomb Threats • All bomb threats should initially be treated as if they were real, although most turn out to be a hoax. • Most bomb threats are made via the telephone. Therefore, switchboard operators must be trained on how to respond. • It may be good to have some simulated bomb threat calls with switch board operators so that when a real call comes in, their reaction will be one of careful thought versus panic.

44. BOMB THREATS • The person receiving a bomb threat should; 1)Remain calm but advise the caller that many innocent people might be hurt. 2)Keep the caller on the line as long as possible and attempt to get such information as time remaining until detonation and location and type of device. If at all possible, the operator should try to get someone to call the police while the caller is on the line.

45. Bomb Threats 3)Take careful notes of EVERYTHING that the caller tells you. Also try to collect any additional information you can such as background sounds, Is the call from the outside or inside the plant?; Is it an operator assisted call?; Is the caller a male or female?; Any particular speech or words that sound unusual? 4)Ask “Who is calling?” several times. You might catch the caller off-guard.

46. Bomb Threats • As soon as the caller terminates the conversation, the operator should IMMEDIATELY notify the plant manager or senior member of management on duty. • It is up to the plant manager to evaluate the threat and determine the appropriate action to be taken.

47. Explosions & Fires • Explosions and fires can be covered in a Crisis Management booklet under the same heading because most of the time they happen together or one may cause the other to happen. • Anyone discovering a fire should immediately contact the central operator (or however you write your plan) and then immediately evacuate the area. Pull any alarms in the area. While exiting, every employee should be notifying other co-workers to evacuate the building .

48. Explosions & Fires • Maintenance or whoever is designated in the CMU booklet should be in front of the plant to direct the fire department to the area involved. • Your CMU booklet should have a map of the evacuation routes in the plant. These evacuation routes should be posted throughout the plant and new employees should be made aware of them.

49. Explosions & Fires • During the initial stages of a fire, the plant manager will determine what areas, if any, need to be evacuated. If the decision is made to evacuate the plant, the members of the First Responders, HAZMAT team and maintenance may be used to aid in the evacuation.

50. Power Outages • The loss of electrical power is not a major problem for most plants unless it is for an extended period of time. • It could be assumed that this problem may occur in conjunction with other emergency type situations. This would mean that those situations would then become more difficult to handle.