Transcript Crisis Management

The Risks – More Than Just Food Issues ?
David I Brown
Managing Director
Food Quality Compliance Solutions Ltd
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“ What we anticipated seldom
occurs. What we least expected
generally happens “
Benjamin Disraeli
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Risk Assessment Objective
Enhance the ability of the business to deliver an objective by
ensuring that the level of risk involved is appropriate
Achieved by :Identification of the risks that threaten the delivery of an objective
Prioritisation so that the focus is on management of risks that are
unacceptably high
Development of plans to mitigate these risks
Identification of areas outside of management control that would
provide a large upside return
Development of plans to exploit these opportunities should they
arise.
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RISK AWARE
SETTLER
Knows that there are
risks out there. Doesn’t
want to chance anything
PIONEER
Understands the risks.
Takes chances but stays
in control
RISK
AVERSE
RISK
TAKING
GOPHER
Doesn’t know what’s out
there and doesn’t care.
Stays underground
where its safe
COWBOY
Does what he/she feels
like.
Doesn’t think (or care)
about the risk
RISK OBLIVIOUS
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Everything is a risk !
Even substances that we think are harmless, such as water,
can be harmful if drunk in large quantities
Paracelsus, often called the “Father of Toxicology” wrote in
the 16th century: “All things are poison and nothing is without
poison, only the dose permits something not to be poisonous”
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A few thoughts about risk
Risk means different things to different people
We juggle risk inconsistently – through ignorance or a
willingness to accept the odds – even when they are
against us
What might appear to be the obvious greatest risk can be
over shadowed by a series of minor ones
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There are risks with everything but risk assessment is
not pointless
Risk assessments must lead to a conclusion about what
matters and would do most damage to your business
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BP fire – Bay of Mexico
Distillery fire Merseyside
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Business Risk Profile
(D) medium
(G) high
(I)
IMPACT
3) critical
CR
IT
IC
(B) low
(E) medium
(H) high
(A) low
(C) low
(F) medium
2) major
1) manageable
1) remote
2) possible
3) likely
(< 10%)
(10 - 50%)
(> 50%)
AL
Carry Out a RISK
ASSESSMENT
List the top 10 to
15 Risks
Determine Major
Ones using this
matrix
LIKELIHOOD
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Business Risk Profile
(D) medium
(G) high
CR
IT
IC
(I)
IMPACT
3) critical
(B) low
(E) medium
(H) high
(A) low
(C) low
(F) medium
AL
2) major
1) manageable
1) remote
2) possible
3) likely
(< 10%)
(10 - 50%)
(> 50%)
LIKELIHOOD
F
A
C
CRISIS
SIMULATIONS
AND ISSUE
RESOLUTION
T
S
The way of working using
the FACTS process
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The TOOLS Crisis Manuals
+ crisis team
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F – Establish the Facts – take the
hearsay out
A – Assess the Risks and Identify
THE FACTS
PROCESS
Actions ( use risk assessment)
C – Communicate the Plans and
determine the Costs and Insurance.
Develop the communications plan
T – Establish the Time Pressures
S – Prepare Summary for Due
Diligence
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Escalation Process
Determine whether Class I, Class II or Class III
Class I is High Risk , Class III is Low risk, by
determining :The type of hazard
The level of disruption
Whether it can be resolved internally or more
global issue
Is there media interest, National issue or global
How much damage to the brand equity
Who should be involved and at what level
throughout the business
Follow the FACTS process
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The TOOLS and the Crisis
Manual
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There is a clear Crisis Team structure
which has specific roles and
responsibilities, contact methods and
crisis room requirements
Each person has a role that needs to be
understood in a crisis situation
Understand the FACTS process and
Escalation process and feel capable of
using it in a crisis
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Risk and Opportunities Categories
Business Environment Risks : Economic or industrial conditions, political environment, social
trends, natural catastrophes
Operational Risks: Brands, product availability, quality and safety, intellectual property, retention of
core equity, legislation / regulation, litigation, procurement, production, logistics management,
distribution, product tampering / counterfeit, NPD, environmental, health & safety, sales optimisation,
human resources utilisation, management information and decision making, third party and JVs,
business interruption.
Strategic Risk : Strategic direction, organisational structure, strategic alignment of the operational
plans, innovation, strategic execution
Financial Risk : Financial markets, commodity costs, credit, funds management, intellectual
property, fraud and illegal acts, tax management
Compliance Risk : Legislation and regulations, supply chain, demand, tax legislation, litigation,
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Processes that are effective ,
implemented and well managed
Trained responsible staff
clear procedures and instructions that
are audited to determine compliance
and allow improvement
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