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Management Lessons from the Pandemic Chaos
Recent studies carried out by the ANRA, the National Association of Risk Managers, reveal that many CEOs and executives are incapable of handling the current crises. The most astonishing data collected was that 51% of companies do not have a crisis management plan.
26 July, 2021

The Covid-19 pandemic has enormously impacted the management styles of organizations with both the public and private sector having difficulties managing any activities other than the customary. The economic instability that distinguishes a besieged society by the virus requires unprecedented decision-making methods and skills, poorly displayed by most of the current global managerial class. The words of Antonio Gramsci today seem to be of the utmost topicality: a crisis represents those moments in which the old world is dying, and the new world struggles to be born. 

Recent studies carried out by the ANRA, the National Association of Risk Managers, reveal that many CEOs and executives are incapable of handling the current crises. The most astonishing data collected was that 51% of companies do not have a crisis management plan. This is a cultural problem, widespread not only in small and medium-sized enterprises, where management is intuitive but also in many multinationals companies. In 2018, a report by the Etishere Institute already highlighted how the largest companies on the international level had crisis management plans focused only on the most known risks: environmental, cyber-attacks, or related to institutional reputation but there was no sign of plans for a pandemic, which is alarming considering that pandemics are a reoccurring event in our history.

The myths related to crisis management appear in all the highlights shared in those studies. These myths created a conviction: the crisis does not concern us directly, and when it is present, it is only an isolated case. Before the epidemic exploded, most managers of small and large companies shared this belief. But the recent pandemic has presented a different reality for managers: today’s crisis affects all businesses, and it is a global episode. The current pandemic has three specific characteristics: it happened suddenly, it has an uncertain future and outcome, and it is indefinite. All of this has devastating effects on managing and leading behaviours.

The first consequence is chaos. Companies reacted to the crisis with many different and contradictory responses. Initially, there was organizational conflict on decisions, with managers taking sides and unable to agree on unified plans of action. A generalized paralysis followed, and no one seemed to be able to make any decisions that mattered. Finally, anxiety grew between people, for the present but above all for the future. This series of managerial missteps fed the crisis itself and pushed it beyond its natural course. All these apprehensions clearly indicated that new skills are needed, geared towards decision-making and networking strategies, to allow for selective and wide-ranging interventions. Compared to past crises, what derived from Covid-19 fully shows the effects of the new globalization’s dynamics. Local problems become global. The butterfly effect, known to physicists and complexity theorists, is showcased here better than ever before. It is necessary to be ready for emergencies, modifying behaviour styles and organizational forms when necessary. Crisis management needs to take place between different organizations, leveraging strong networks and best practice sharing. No one can be a nomad if they want to thrive in the modern world. On the institutional front, there is a need to strengthen cohesion between nations, international bodies, local authorities, representative associations and companies, profit and non-profit. Sociologist Edgar Morin uses the term “community of destiny”. Since we are all exposed to an identical danger, we need to know how to change our management strategies. In other words, it is necessary to move from “being in relation”, typical of formally integrated economies, to “being in common” typical of the communitarian contexts. Thus, effective measures to face a crisis depend on acting in harmony.

1 Comment

  1. Stefania Jaconis

    This is a welcome first step of a ‘global’ set of thought-provoking ideas, which for a number of reasons cannot be generated by business managers alone. What we need today – faced as we are by a post-pandemic world, with all its complexities – is a joint (yes ‘harmonic’) contribution by scholars active in various fields: economists but also social scientists, researchers in environment-related studies, mathematicians…All taking a vision-oriented approach.

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