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Subject: Strategy management

Topic : Crisis mangament

Presented to:

Sir Arslan sarwar

Presented by:

Sana Javaid

12052054-045

Semester 4nd (M.com)

Section BL

G.T road science College Gujarat

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Crisis management

Crisis Management is the process by which the organization manages a wider impact, such as

media relations, and enables it to commence recovery. It involves identifying a crisis,

planning a response to the crisis and confronting and resolving the crisis. It is a systematicresponse to unexpected events that threaten the people, property and operating continuity of

the organization. It is a set of procedures applied in handling, containment, and resolution of

an emergency in planned and coordinated steps.

Readiness

Response

Recovery

Crisis is major, unpredictable event that threatens to harm an operation, staff, customers,

reputation or the legal and financial status of an organization Crisis can strike any time

and during this Situation it tends to be Confusion, Uncertainty, fear. A crisis is an

abnormal situation, or even perception, which is beyond the scope of everyday business

and which threats the operation of an organization. Crisis is an unpredictable events but it is

not unexpected.

Three common element of crisis :-

A threat to the organization

The element of surprises

A short decision time

TYPES OF CRISIS

Crises can be categorized into a wide array of different genres on different bases; they can be

classified according to different social settings or according to frequency or timing of their

occurrence.

1. DOMESTIC CRISISThis kind of crisis is related to domestic life of a person. This type of crisis usually

occurs in the home and involves individual and members of his family.

2. INDUSTRIAL CRISIS

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Accidents caused due to human error including neglect, miscommunication and cost

cutting techniques employed by businesses so that costs can be minimized and hence

profits may be maximized.

3. NATURAL CRISISThis natural crisis happens in the environment and more often than not the activities

of human beings have nothing to do with it.

4. FINANCIAL CRISISCrises of this nature are usually monetary crisis that an individual may face during the

course of his/her own life. However, perhaps what is so dangerous about this type of

crisis is that it may potentially lead to the other types of crisis mentioned above..

Example of crisis management

Worms found in two Cadbury chocolate bars in India:

After the two candy bars were reported in 2003 to have worms, Indian authorities seized

Cadbury stock at a nearby plant. The company was slow to respond and at first claimed

infestation wasnt possible during manufacturing. Authorities disagreed. Media coverage put

Cadbury in a bad light. The company changed course with a public relations project targeting

retailers, imported new machinery and added new packaging and gave updates to the media.

Sales had plummeted 30 percent. Cadbury launched a marketing campaign and,within eight weeks, sales were close to normal. In eight outlets across Maharashtra,

worms were found in some bars of Cadbury Dairy Milk, Cadbury's bread-and-butter

brand selling 1 million bars a day and an icon of 'chocolate' in India.

Inquiry was instituted by the Food and Drug Administration and negative mediapublicity spread like wildfire. The extensively graphic media coverage led people to

believe that every bar could be contaminated. Consequently, sales volume

plummeted, retailer cooperation lessened and employee morale dwindled. All in all,

the company's credibility suffered extensive damage.

Reason behind this crisis After a thorough investigation of the entire supply chain, it was found that the

problem originated at the distribution end. Apparently, at the retail outlets the infested

bars were placed next to open unpacked items susceptible to worms.

However, although the problem was not of its own making, Cadbury did takeresponsibility for the lack in educating retailers on storage and hygiene.

Using IMC elements to overcome from this problem

AdvertisingThe company began its multi-pronged campaign on key print, broadcast and

electronic media, to regain its lost credibility and almost reestablished the category.

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Message strategyIt decided to convey that the root of the problem was as the distribution end, that

any food item could face similar infestation, and yet Cadbury would take initiatives to check

the problem

Cadbury also roped in Amitabh Bachchan as its brand ambassador since the celebritywas hugely popular and reputed for his integrity, qualities that Cadbury needed to re-

associate with the brand.

A rationally and emotionally connecting television commercial, again starringBachchan, was also aired nationally. The star gave a first hand account of his visit to

the Cadbury factory, assuring people about the quality of the chocolate . In another

version of the ad, he also emphasized the safety of the product for children.

Public Relationship Campaign

The company launched Project Vishwas, a three-pronged program that addressed the trade,

consumers, media and employees. The project incorporated the following measures:

For Trade

A retail monitoring and education program was launched that performed qualitychecks at over 50,000 retail outlets and educated 190,000 wholesalers and retailers

regarding storage requirements.

A press ad regarding 'Facts about Cadbury' was also published nationally in 55 tradepublications informing channel members about remedial measures being taken by the

company.

Posters and leaflets on the issue were also distributed to retailers, encouraging themto share them with consumers.

For Media

The media was also explained the company's point-of-view, given updates aboutactions initiated by the company, and encouraged to share them with consumers.

The company instituted a media desk and diligently answered every media query,friendly or not. The company's managing director urged media to assure consumers

that Cadbury was safe to eat, but that consumers exercise the usual care in purchasing

a chocolate that they exercise in purchasing a food item.

Furthermore, it also promised to implement packaging changes within two months toensure against poor storage. Cadbury's MD and key spokespersons had

For Employees

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