Risk Management |
Article by David Wolowitz, McLane Middleton
From the July/August 2018 Net Assets magazine
What makes an independent school succeed or fail when crisis strikes? More often than not, the difference hinges on whether the administration and board work collaboratively. The greater the crisis, the greater the stressors on the relationship between the two. Advance planning is critical. A crisis is no time to find out what works and what does not, much less to let one or more outspoken or undisciplined trustees hijack any commitment to transparency and accountability.
I’ve seen it again and again. In the face of crisis, an independent school’s operational leaders, such as the head of school and CFO, almost always commit to taking the moral high ground and doing the right thing, even if it’s tempting to “protect the school’s reputation” instead. The board chair and executive committee typically share this commitment as well. The problems often begin when the crisis comes to the awareness of the full board. High-stakes scenarios tend to trigger emotional reactions. One or more trustees may balk against some aspect of the crisis-response plan or recommendations. They might “know someone” who can do a better job. Or they might casually reveal highly classified information to their family or friends.
Any of these scenarios can backfire in ways that prove to be calamitous for the school. Here’s a better approach.
Prior to any crisis, be sure your school’s administrators and trustees agree on three key organizational dynamics: respective roles, guiding principles and information-sharing.
In this age of instant electronic communications, rapid action is a necessity. Although the administration is primarily responsible for crisis management, certain responsibilities are likely to fall to the board. I suggest a hybrid approach to crisis response that helps the administration quickly execute its decisions with board support.
Both groups need a dedicated crisis-response team. The board committee supports and empowers the administrative team by addressing the fiduciary, strategic and ethical issues that might arise. The size of the board committee varies, but it must be able to act quickly when needed, with the trust of the full board. Some boards utilize their executive committee for this function, others create an ad-hoc special committee. In any case, the board chair should be a key member who acts as ambassador to the full board.
Be equally careful in selecting the administrative crisis-response team. This should include an operational leader who has the time, skills and personality to take a lead role in implementing key actions to free up the head of school to attend to other duties.
Schools often require outside assistance from supporting professionals in crisis situations. Depending on circumstances, these may include legal, crisis communications, investigation, mental health and insurance specialists. The time to research potential specialists and interview them is in advance of a crisis. Too many schools regret choosing consultants in the haste of responding to a crisis.
Once in place, the crisis-response team should establish working procedures. Among its first tasks is agreeing on a decision-making process. Determine what kinds of decisions will require board input or approval and how that input or approval will be obtained. Establish processes for internal communications, including routine and urgent communications within the crisis-response team and within the board, as well as for external communications with the authorities, the school community, and traditional and social media. Summarize these working procedures in a crisis-response plan.
Consider using legal privilege to protect sensitive information to the extent possible. Be sure your board members are trained in the importance of protecting privileged, private and sensitive information.
Effective communication is crucial to crisis management and fundamental to building and maintaining trust. The chair should share urgent information with the entire board so that no one in a position of responsibility feels uniformed or blind-sided. On an ongoing basis, be sure the board and administrative crisis-response groups have regular update calls or meetings. Delegate responsibility for various communications. Keep the following informed as appropriate: legal counsel, the authorities and various constituencies of the school community.
No crisis-response plan can anticipate all contingencies, and even the best plan will not be helpful if it is not well implemented. Invariably, a crisis will stress roles, structures and procedures. Therefore, it is crucial for the crisis-response team and the board to train for a crisis. One useful exercise is a tabletop exercise in which a crisis scenario plays out. In responding to each scene in the training scenario, participants can practice identifying issues, making decisions, and communicating internally and externally.
When a crisis occurs, certain steps should happen quickly and routinely. You might want to create and monitor action lists for items such as mandated reports, safety measures and board notification. Activate the administrative-response team and board subcommittee, and engage the appropriate supporting consultants. The crisis-response team should prepare an initial plan and strategy, knowing that it should continually be revisited and revised. All involved parties should strive to be proactive and to stay on the moral high ground.
The head of school should delegate as much as possible to preserve energy and not lose focus on other significant school activities. Whenever possible, utilize the strengths of team members and consultants.
Crises do not always have a clear ending point. When sufficient time has passed, conduct an after-event review. Unaddressed behavioral issues within the administration or the board will be a liability in the next crisis. Determine what worked and what can be improved the next time. Inform the board of any conclusions. Adjust policies, procedures and team members accordingly. Update the crisis-response plan.
Then begin the training and preparation process all over again. When it comes to crisis response, you cannot rest on your laurels.
Download a PDF of this article.#Governance#CrisisManagement
Nowhere to Hide: Best Practices in Crisis Management (July/August 2016)
The Case for Legal Counsel (May 2017, web-only)
ERM: Everyone Is a Risk Manager (July/August 2015)
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