What are the 4 Ps of crisis management?

During one of the most tumultuous periods of disruption, universities and colleges have been forced to confront multiple crises ranging from safeguarding the physical health of students and staff, to determining how to counterbalance ancillary budget losses, to measuring the efficacy of virtual learning. Collaboration and partnership between a college’s administration and the board can prove to be an institution’s saving grace during these difficult times.

There are four phases of crisis management that can help keep a focus on the institution’s long-term mission and goals.

Four Phases of Crisis Management

1. Mitigation
2. Preparedness
3. Response
4. Recovery

It may be tempting to ignore mitigation and preparedness when you’re in the middle of a crisis and move right to response and recovery modes. However, it’s essential to give the first two stages careful thought and analysis. A crisis like COVID-19 is a dynamic situation with long-term implications. It’s good governance practice for the board to carve out time or dedicate a committee to consider the next phase of crises and determine what preparation measures can be implemented.

Phase 1: Mitigation

There are six items to consider during the mitigation phase:

• Create a risk management team.
• Designate a coordinator who is ready to act.
• Create, or evolve, a business continuity plan (BCP) to determine how you will serve your institution’s community during a time of crisis.
• Create a communications strategy for communicating with stakeholders and communities both on and off campus.
• Determine your best sources of information in times of crisis and establish communications channels.
• Understand budget ramifications and which areas of revenue and expense are most likely to be impacted so you can access financial resources when needed.

Phase 2: Preparedness

There are three items to consider during the preparedness phase:

• Periodically review insurance policies to make sure what is covered and make adjustments as needed.
• Put a plan in place to hold remote/virtual board meetings.
• Create a crisis communications plan.

The board can help during this phase by:

• Defining parameters for accessing financial reserves
• Reviewing your bylaws to determine whether virtual board meetings and voting are an option
• Reviewing the crisis communications plan

Phase 3: Response

There are nine items to consider during the response phase:

• Triage the most pressing issues.
• Communicate regularly with your key stakeholders.
• Analyze budget implications and create contingency plans.
• Implement the business continuity plan.
• Institute remote work.
• Reconfigure staffing needs.
• Manage the stress response from all stakeholders: staff, students, trustees, donors, funders, etc.
• Access response/recovery funds and insurance benefits and stabilize cash flow.
• Observe where the disaster reveals weaknesses in your organization and begin prioritizing how to fix them in the future.

The board can help during this phase by:

• Supporting college and university leaders and back up to them on all decision-making
• Supporting the implementation of the business continuity plan
• Empowering the administration to be creative
• Triaging and managing the amount of “help” being offered by community members
• Beginning documenting the organizational stressors
• Meeting frequently to address real-time issues and keep the full board informed
• Supporting staff’s short-term decision-making while also advancing long-term needs
• Arranging for mental health support for staff, as needed

Phase 4: Recovery

There are 10 items to consider during the recovery phase:

• Rebuild learning models to evaluate what is possible in this new environment.
• Talk to your peers – learn from others.
• Adopt a strategic plan as needed.
• Access recovery funding.
• Address any organizational weaknesses revealed during the crisis.
• Create transition plans for the new normal for all stakeholders.
• Acknowledge and manage the ongoing stress and trauma for all stakeholders.
• Emerge from triage decision-making and make better long-term decisions.
• Identify new areas for investment and divestment.
• Renegotiate stakeholder agreements, contracts, etc.

The board can help during this phase by:

• Being unified in supporting the work and staff
• Celebrating the good work that was done during the crisis response
• Identifying and capturing “lessons learned” during the crisis response
• Creating a plan for addressing the organizational stressors
• Meeting as needed to address real-time issues
• Challenging and supporting the staff to renew long-term decision-making
• Addressing board structure, relationships, and policies that hindered the board during the crisis
• Challenging board and staff to address what’s been left unsaid and unaddressed

A Board Portal Brings Everything Together

A board portal – also known as board management software – is a secure platform for use by your board and college administration. It offers boards a robust, secure set of tools everyone needs both during and outside times of crisis, including the ability to access meeting materials, communicate with each other, and execute governance responsibilities.

AGB has a powerful platform in AGB OnBoard that was created especially for colleges and universities to navigate crisis management and enhance the work of governing boards. Board materials such as policies, documentation, and past decisions are too often scattered among emails, text messages, shared drives, and more. A board portal centralizes all board communications and content in one place, thus eliminating email overload, lost files, and communication breakdowns.

Paroon Chadha is the Co-Founder & CEO of AGB OnBoard and its parent company Passageways.

Related Resources

Opinions expressed in AGB blogs are those of the authors and not necessarily those of the institutions that employ them or of AGB.

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As it did most companies out there, the 2009 recession hit Springfield ReManufacturing Corporation like a ton of bricks. But, as I’ve discussed a few times, there were a number of key decisions that helped us pull through to the other side.

Now that 2009 is more than 10 years behind us, it’s clear those decisions didn’t just help us survive – they're what helped us thrive.

We needed something to help us focus on surviving the recession and all the heartache that comes with a downturn.

Currently we're staring down the barrel of full blown pandemic and memories of the recession of 2009 rushes back to mind.

Back then, we came up with something we called "The four P's: People, Positive cash flow, Profits, and Positioning." I can say it was a huge help during that crisis and I'm glad we have the four P's now as we lean on them to get us through the current crisis. 

The Four P's are as follows:

1. People

Our goal is not only to maintain our open-book culture and keep the communication channels open but to double down on our efforts to keep everyone informed of the constant changes that are occurring. 

At SRC Holdings there's been a standing meeting hosted every morning at 9 AM. The meeting is held with key leadership to discuss updates around the virus and share ideas about what, if anything, we should be doing differently.

The Executive Vice Presidents of SRC Holdings also have a daily meeting every afternoon at 1:30 PM to address questions, make any adjustments, and make sure they're available to help each division across the company.

The information discussed during the 9:00 AM and 1:30 PM meeting is packaged up and sent daily to every employee in the company to ensure the lines of communication remain open.

If you are not communicating every day with your employees about the impact COVID-19 has on your company then today is the day you should start.

2. Positive cash flow

In 2009 banks were shifting their lending requirements. At out bank, we couldn’t borrow based on the value of our assets anymore, such as buildings, machinery and inventory.

If we wanted to survive and grow, we concluded that we needed to focus on maintaining positive cash flow. That was the only way we would be able to keep our current debt level let alone have a chance to obtain future loans.

Cash flow is your Critical Number™ now...period. At least until things have gotten better and the ship right side up as the crisis dwindles. 

3. Practices

We knew 2009 was going to be a tough year and we new we would need to plan accordingly. We were preparing for the possibility that we needed to sacrifice profits, and we needed to remain diligent in our open-book practices and  do it in a strategic fashion. Our Great Game practice helped us position the company to have a strong foothold after the recession. We were prepared to lose money as long we were investing in new opportunities. 

With the current crisis, the divisions of SRC Holdings and The Great Game of Business® are prepared, but we realize that not everyone is prepared to take a hit to profit.

My advice...focus on #1 and #2: your people and maintaining a positive cash flow first. Then, stick to the 10-key steps for your business to survive and be as strategic as you can about the best way to position the company after the COVID-19 crisis has ended.

As you move on to positioning, remember your biggest asset is your people. Communicate. Communicate. Communicate. Keep them in the conversation to create strength across all your teams. Remember, some times the best ideas come from the person you'd least expect!

4. Positioning

Back in 2009, we could tell from our forecasts that our organic growth would eventually stall out. The things we were doing to help propel us for 25 years were coming to a screeching halt.

We needed to figure out different ways to bring in new business. We looked at the recession as a way to encourage diversity and to position ourselves for future growth. Even in tough times, there are always significant opportunities.

This is time to think outside the box. Check out the Black Swan Action Guide for help.

• What are other opportunities for cash flow?
• Is there a new line you can introduce that has high demand?
• Is there a way you can diversify?
• What is one thing that can position you in the right place at the right time?

Open up the discussion with your people. 

Just yesterday, one of our certified coaches for The Great Game of Business received an email from one of their clients. SummitCove, a ski lodge in Keystone, Colorado, closed their doors for two days and made the decision to pay every employee during these two days off.

The company sent out an email to their staff opening up a discussion about "where do we go from here?" This is what the email asked of each employee:

"During your 2 days off, your only job is to think about and write down your ideas on how to cut costs, save money and think about services we could sell that people want to buy. Outlandish and crazy ideas...I want them all! When you come back to work after this much needed time off, we will be working in off-season mode and preparing to complete our Quality Assurance Checks, Deep Cleans, Carpet Cleans, and other off-season activity."

-Peter Reeburgh, Owner of SummitCove Lodging

It will be exciting to hear the amazing ideas that develop from this open dialogue with their employees.

Listen to Peter share a more in depth story about how his team navigated the pandemic on the Change the Game Podcast.

Take this time to focus on your 4 P's: People, Positive Cash Flow, Profits and Positioning. We're all thinking about you and all our business owner friends. We realize this time is tough for many and want you to know we're hear to help.

If you have questions please reach out to us and we will be more than happy to talk through your concerns and guide you in anyway we can. 

Change the Game features stories of real practitioners using and adapting the principles of the Great Game of Business to survive and succeed in the business world, even in challenging times like we are facing today. Click to learn more about these practitioners' stories below:

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