Issue & Crisis

Management
as an
Introduction
Shinta Desiyana F
Learning
Outcomes
• Distinguish between issue management, risk management, and
crisis management.
• Identify and briefly explain the stages in the issue management
process.
• Describe the major categories of risk and some of the factors that
have characterized risk management in actual practice.
• Define a crisis and identify the four crisis stages.
• List and discuss the major stages or steps involved in managing
business crises.
Chapter Outline

• The Relationship Between Issue,

Risk, and Crisis Management
• Issue Management
• Risk Management
• Crisis Management
• Summary
Issue & Crisis Management

The World Health Nearly 300 people became Several causes of the crisis
Organization declared the sick, and several infants included farmers using a
China dairy industry died due to tainted infant lower grade of feed,
scandal to be one of the formula and food products. distributors adding
largest food-safety crises melamine to boost protein
in recent history. content, and dairies, and
US firms distributing the
tainted milk, or using its
contaminated ingredients,
and government cutting
food inspections.
 Issue & Crisis Management

But such tragedies, and Major external social

With little government
the financial scandals of events not caused by
oversight, the consumer
many corporations, business also affect
is forced to rely on
continue to erode businesses, and firms
businesses to act
consumer trust in must prepare to deal
responsibly.
businesses. with them.

Managerial decision-
making processes
No company is immune
to the threat of a crisis, should include Issue
Management, Risk
but few prepare.
Management, and Crisis
Management.
Relationship between Issue,
Risk & Crisis:
• Differentiating between these 3 is difficult. Many product
managers cannot differentiate between “risks” and “issues,”
which has led them to be labeled the Siamese twins of public
relations.

• The Issue Management Council definitions:

ü Issue – a gap between a firm’s actions and stakeholder
expectations
ü Risk – a potential issue that may or may not occur
ü Crisis – an issue that has escalated to a critical state
Relationship between Issue,
Risk & Crisis:
• Goal: To be effective, issue, risk and crisis
management must close the gap between the firms’
situation and its stakeholders’ expectations.
• Many of the crises firms face today arise out of
issue categories they are monitoring and prioritizing
through issue management systems.
• Risk Management may keep issues from arising
• Effective issue management may enable the firm to
avoid a crisis, or minimize its impact, and is vital to
post-crisis management.
Issue Categories
Issue Management

• is a process by which organizations:

ü identify issues in the stakeholder environment,
ü analyze and prioritize them in terms of their relevance to
the organization,
ü plan responses to the issues, and then
ü evaluate and monitor the results.

• It is helpful to think of issue management in connection with

sustainable strategic management process, enterprise-level
strategy, corporate public policy, and integrated reporting.
Approaches in Issue
Management:
1. Conventional Approach
• Narrowly focused.
• Issues fall within the domain of public policy or public affairs
management.
• Issues have a public policy or public affairs orientation.
• An issue is any trend, event, controversy, or public development
that might affect the corporation.
• Issues originate in social, political, regulatory, or judicial
environments.
Approaches in Issue
Management:
2. Strategic Management Approach
• Broadly inclusive.
• IM is typically the responsibility of senior line management or
strategic management staff.
• Issues identification is more important than it is in the conventional
approach.
• Issues management is seen as an approach to the anticipation
and management of external and internal challenges to the
company’s strategies, plans, and assumptions.
Strategic
Issue
Management
THANK YOU
See you on our next meeting!