Dealing with Organizational Crisis

By Constance B. Wolf

The road to healing. Many things can cause an organization to lose control and move towards a chaotic or crisis state. These may include: rapid growth; financial mismanagement, inadequate budgets , lack of leadership or capabilities; staffing problems; or poor planning and implementation.

When the signals that an organization is in trouble are not noticed early enough to avert the crisis and a crisis begins, a new set of dynamics impact what we do. The spotlight is now aimed at us. Rather than being able to deal calmly and rationally with the situation, time and other pressures often change our usual mode of reacting: everything is heightened, both within us emotionally or perhaps outside of us through media attention, stakeholder oversight or even legal battles.

Dealing with Crisis Once in crisis, we must deal both with the everyday operations of the organization as well as the crisis itself. Often a separate committee is deemed useful to oversee the resolution of the crisis.

A helpful orienting principle can be found in The Gestalt Model of Experience, which summarizes the process by which people become aware of what is going on within themselves and in their environment, and mobilize energy to take action to resolve problems. The Gestalt model is based on the assumption that when disequilibrium exists, the natural human tendency is to take action which results in a new state of equilibrium.

The Gestalt Model The Gestalt Model involves a continuum of phases from sensation, awareness and energy mobilization to action, contact, resolution/closure and withdrawal of attention. Four separate plans can serve to link these phases:

1. Crisis Plan - When a crisis situation develops (sensation), it is necessary to initiate a crisis plan. A crisis plan should create the crisis steering committee; define the roles and responsibilities of the various stakeholders, e.g. leadership, spokesperson, expert advisors; and delineate the steps needed to address the process (e.g. the Gestalt Model or a similar process model).

2. Communications Plan - A communications plan is needed to ensure that stakeholders have correct information and are continuously kept informed (awareness). This action can allay fears and work to maintain trust. Meetings or other participatory mechanisms are needed to facilitate two-way communication, which will mobilize the stakeholders towards resolving the problems identified by the steering committee. (energy mobilization).

3. Action Plan - The steering committee, together with the appropriate stakeholders, develops the action plan, clarifies roles and responsibilities, and oversees its implementation. (action and contact) Once the crisis is under control, the leadership has the responsibility to look for opportunities to prevent similar situations from occurring in the future. After new plans are agreed upon, communications can be designed to bring closure to the crisis as well to instill hope for the future (resolution/closure).

4. Withdrawal Plan - Leadership management of the crisis will be critical to restoring the reputation of the organization and maintaining the dedication of its stakeholders afterwards. Open lines of communication and participatory problem solving will help a great deal in managing the psychological and emotional turmoil participants will face both during and after the crisis.

Communicating lessons learned and any corrective action taken will go a long way towards restoring enthusiasm and ensuring continued loyalty of employees, customers , clients and other stakeholders.

More information on Gestalt Model of Experience may be found in the book,

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Connie Wolf is president of Sounding Board®, a service of CBW, Inc. She holds a master's degree in Organization Development and is a graduate of Coach University and the Gestalt Therapist Training Program. She is the creator of the Sounding Board® approach to professional coaching and consulting and can be reached at  or 480-607-1960.