Is crisis a catalyst for organisational growth?

February 2017 by Carrie Birmingham


Sometimes an organisation needs a wake up call to enable it to see what is happening and a crisis helps it to see something previously hidden.    Created by the US military to describe our environment, VUCA (Volatility, Uncertainty, Complexity, Ambiguity) is the latest acronym we can baffle our colleagues with.

It is a great summary of why organisations need to employees who are agile, able to learn and brave.  However these behaviours are usually squashed by budget cuts, multiple unfocused meetings, policies, legislation and fear of change.

“As people started to arrive, I could feel the trepidation in the air. The function had responded to an ‘all staff’ invitation, following some high profile mental health problems in our business. Typical of the industry, we set ambitious targets and expected our employees to regularly entertain clients over business lunches and extravagant evening functions. The unasked question : what impact this was this having on people’s health & wellbeing?”

In her book Liz Hall, argues a crisis can be a catalyst for personal transformation, debunking the commonly held belief that development is a wholly positive experience. However learning has often involved me “mining diamonds from the muck”. I believe the same can be true for organisations.

Innovation and growth consultant Scott Antony views Kodak as a good example of an organisation failing to adapt to a rapidly changing environment that was disrupting its market. In a recent article, he argues Kodak’s executives simply missed warning signs, neglected opportunities and lacked sufficient courage to tackle fundamental change that threatened its business model.

This problem is common.  Organisations tend to make staff accustomed to working in a particular way. We believe that how things are done (the culture), is “normal” and convince ourselves everywhere is the same.  We lose objectivity because we are part of the system and invested in it which makes us reluctant to make radical changes.  This creates blind-spots, which means we fail to see the warning signs of problems or issues.

We know the human brain filters out (and ignores) things that don’t fit, to enable it to cope with the volume of information it receives.  The same is true for organisations: warning signs are often filtered out.

Like a tornado, a crisis gathers speed and scale.  A crisis brings to the surface, what has been ignored.  It also creates the opportunity and sense of urgency for changes that previously felt too radical.

When a crisis hits, the first instinct for leaders is survival; understandably there is a focus on short term damage control.  But what if organisations in the grip of crisis also considered the longer term? What if they thought about how they might benefit, rather than simply fire-fighting in the ‘here and now’?   In their book James & Wooten argue this is the difference between crisis management and crisis leadership.

A crisis disrupts the status quo, and so represents an opportunity to talk about what the organisation does and how it does it.  This means using a learning approach to truly understand the root causes of the crisis, drawn in external expertise, seeking the views of multiple stakeholders – including staff – and thinking longer term.

Waitakere maternity services in New Zealand describe their transformational approach to a sad and alarming crisis when a women caught fire during a caesarean birth! Their crisis leadership during this event overturned the ‘normal way’ of doing things in healthcare at the time. They were able to retain the women’s confidence in the hospital (her sister had her baby there too – by choice). And the attitude and confidence of clinicians was transformed– they are normally hung out to dry in such cases

In the glare of the spotlight, it is comforting for senior leaders to focus on getting a lid back on the crisis so they can get back to “business as normal”.  I would invite organisations to ask a simple question: ‘If we were honest with ourselves, what is this crisis really telling us?”