In a world that is increasingly characterised by uncertainty, the ability to manage crises has become a decisive success factor for managers in companies.
In this new podcast episode (German language), Volker Petersen, an experienced crisis management expert, explains exactly how this process works. He combines decades of management experience in industry and commerce with his involvement in the fire service – an impressive blend of two different worlds.
Learning from disasters: The importance of crisis teams
A formative experience for Petersen was his involvement in one of the worst train accidents in German history – the ICE accident in Eschede in 1998. ‘Such major incidents require the cooperation of rescue services, police, fire brigade and other organisations in crisis and disaster teams,’ he explains. He has also gained valuable experience in other major events, such as flood disasters, as a member of crisis teams and on-site fire service operations manager.
Today, Volker Petersen uses this expertise to support companies in being prepared for unforeseeable events of all kinds. The aim is to create structures and processes that enable companies to react quickly and effectively in order to minimise damage and return to normal operations as quickly as possible.
Why companies should prioritise crisis management
The transfer of experience from disaster management to business practice is worthwhile. Companies benefit if they develop emergency plans at an early stage, train employees and define clear responsibilities. Volker Petersen emphasises: ‘Professional crisis management can not only reduce losses in companies, but also create long-term competitive advantages.’ Because one thing is certain: the next unplannable event is bound to happen.
Expertise and structure make the difference
Crisis management is often misunderstood. ‘People initially only think of business issues such as receivables management or profitability,’ explains Petersen. However, another challenge is dealing with sudden, disruptive events that directly jeopardise operations. He cites some real-life experiences from his own experience:
- A water ingress in a warehouse: 14,000 square metres of storage space were under water and had to be extensively renovated, while 120 employees were unable to enter their workplace.
- A bomb disposal in front of the company premises: Here, the entire workforce was affected, as neither entry nor exit was possible. At the same time, the situation had to be coordinated with the police, fire brigade, suppliers and media.
- Extreme weather and blackouts: Heavy rain, storms or widespread power outages present companies with massive logistical and operational challenges, especially if the outages last for several weeks.
The examples from Petersen’s practice show that crisis management is not just a side issue, but a core competence for every company.
Three steps to crisis security
When Volker Petersen comes to a company to optimise its crisis management, he follows a tried and tested three-day plan:
Day 1: Analyse and get to know the company
The first step is to understand the company. Petersen conducts interviews with the management and, if necessary, with safety officers. The central questions are discussed:
- How is the company organised?
- Are there any specific hazards, such as the handling of hazardous substances?
- What are the operational priorities?
The aim is to gain an overview and identify the company’s specific risks.
Day 2: Setting up a crisis team
On the second day, Petersen helps to establish a so-called crisis team – a team of employees from different departments who take responsibility in emergencies. The crisis team is trained to be prepared for potential crisis scenarios. ‘It’s about confronting the team with the issues and teaching them the necessary skills,’ he explains.
Day 3: Practice scenario
Practice is crucial in order to apply what you have learnt. That’s why the third day is used for a crisis exercise. Petersen creates a customised scenario tailored to the company’s specific fears and challenges – be it a fire, a cyber attack or a heavy rain event. The crisis team works through the scenario according to a script, which not only provides insights into open flanks, but also strengthens confidence in the company’s own abilities.
The aim of the three-day programme is on the one hand to uncover weaknesses, but on the other hand also to create security and self-confidence in dealing with crises. Petersen emphasises that the exercises are fun for the participants because they give them a sense of control and preparation. ‘The participants often recognise aspects of their company that they were previously unaware of and feel relieved to have found sustainable solutions,’ says Petersen.
One scenario, many insights
The process starts with the selection of a specific crisis scenario, which the entrepreneur can choose themselves. Be it a storm, a fire or a cyber attack. But is one scenario really enough? Petersen explains: ‘The basic structure of the crisis team is always the same. Regardless of whether it is a fire or a natural disaster, the procedure learnt can be transferred to many other situations.’ This universal approach makes it possible to build up broad crisis expertise with one exercise.
The structure of an effective crisis management team
An effective crisis team is the centrepiece of crisis management and typically consists of seven members representing different areas of the company:
Subject area 1: Personnel
The ‘Human Resources’ department deals with all issues that affect the workforce. This includes the organisation of shift schedules, the cancellation of shifts and communication with employees. The staffing of the crisis team and possible replacements in the event of prolonged crises also fall under this area.
Subject area 2: Situation
The presentation of the situation is central to maintaining an overview in a crisis. This includes visual representations of the damage, e.g. on a whiteboard or flipchart, as well as the recording of all decisions. The log is not only relevant for insurance companies, but also for official or legal enquiries, which often only arise years later.
Subject area 3: Operations
The ‘Operations’ officer is the interface to external emergency services such as the fire brigade, police or authorities. He or she ensures a smooth flow of information and is available as a contact person if specific emergency measures are required.
Subject area 4: Logistics
Logistics takes care of the organisation of resources such as tradesmen, catering or technical equipment. Someone from the purchasing department often takes on this task, as these people have regional contacts and networks that are crucial in an emergency.
Subject area 5: Communication
Public relations work is often crucial in a crisis situation. The person responsible for communications coordinates enquiries from authorities, journalists and social media. This ensures that the company’s external communications are handled in a professional and standardised manner in order to avoid unrest or misunderstandings.
Subject area 6: IT and infrastructure
IT security plays a key role. Whether hardware failures, software problems or the failure of an ERP system – this area ensures that technical problems are resolved as quickly as possible. Preventive measures against cyber attacks also fall under this area.
Management of the crisis unit
The management coordinates the entire crisis team. This does not necessarily have to be the management – on the contrary: Petersen recommends leaving this role to an experienced employee from the second management level. This allows the management to remain in the background to make strategic decisions without being involved in operational processes.
The strength of this structure lies in its flexibility. Regardless of whether it is a building fire, natural disaster or cyber attack, the crisis team always works according to the same principles. This universal approach makes it possible to use an exercise or scenario to build up expertise that can be transferred to many other crises.
Legal basis: Why crisis management is mandatory
Professional crisis management is not only a question of responsibility, but also a legal obligation. In Germany, management is subject to a duty of care in accordance with Section 618 of the German Civil Code (BGB), which primarily focuses on the protection of employees. A breach of this obligation can quickly lead to legal consequences – especially when it comes to the commercial duty of care in accordance with Section 43 (2) GmbHG.
Volker Petersen explains: ‘A management board that can prove that structured crisis management is established and regularly practised has a strong defence position. Those who ignore this provide the other side with an unnecessary target.’
It therefore makes sense to schedule a day once a year exclusively for crisis management exercises.
The changed security situation in Germany
In addition to legal obligations, the changed security situation is also emphasising the importance of crisis management. The German government has formulated a national security strategy and developed an ‘Operational Plan Germany’ that focuses on prevention and response.
Across the EU, two directives are also creating a need for action:
- the Kritis umbrella law (national ratification pending)
This law regulates the protection of so-called ‘critical infrastructure’ (Kritis). It primarily concerns perimeter protection measures such as access control, video surveillance and intrusion detection systems.
- the NIS2 Directive (national ratification pending)
This directive is aimed at the cyber security of companies. It defines how companies must deal with cyber attacks in order to protect data and systems.
What does ‘critical infrastructure’ mean?
The term ‘critical infrastructure’ (formerly ‘systemically relevant’) covers 13 key sectors that are essential to the functioning of our society. These include, among others:
- Transport and logistics
- Medical sector
- Food and retail
- Drinking water supply and waste disposal
- Telecommunications and mobile telephony
These companies are obliged by European and national regulations to set up a comprehensive crisis management system. However, companies that do not fall into these categories are also well advised to prepare accordingly. ‘In the end, it doesn’t matter whether you are a critical infrastructure company or not. You will always benefit if you are prepared,’ emphasises Petersen. Crisis management is not a ‘nice-to-have’, but a business necessity.
Leadership, decision-making and communication as key competences
The question often arises as to whether people are ‘made’ for crisis situations or whether these skills can be trained. According to Volker Petersen, the latter is possible: ‘Leadership, decision-making and communication are essential skills in crisis management. These skills are never so good that they can’t be improved.’
A well-structured crisis team can not only strengthen the necessary skills through regular training, but also utilise the ‘double effect’: In addition to improving crisis management, it also promotes the personal development of those involved. It is particularly exciting that employees often show unexpected potential when they surpass themselves in crisis situations.
Regularly practising skills leads to autonomy
Effective crisis management depends on preparation and repetition. Petersen recommends at least one annual training session: ‘One day a year is enough for medium-sized companies to refresh their knowledge and run through a new scenario.’ The aim is not only to clarify functions and responsibilities, but also to test the team under stressful conditions. This creates security and strengthens the ability to make decisions. Volker Petersen emphasises: ‘Good consulting ensures that companies can act independently. A consultant who organises his assignment in such a way that nothing works without him is not doing a good job’.
Conclusion: Preparation is the best protection
Crisis management is not a question of talent, but of practice. Companies that train regularly and strengthen their employees’ leadership, decision-making and communication skills are prepared for crises. A well-trained crisis team and a focus on personal development make all the difference. Companies should seize the opportunity not only to be prepared for emergencies, but also to strengthen their teams in the long term. We at flow consulting are happy to act as a sparring partner, e.g. when it comes to developing personal strengths with the Power Potential Profile® or how managers deal with complex situations.
Best regards,
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Pictures: shutterstock 1334110262 and 2313091011
