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Crisis Management – Emergency Rapid Response

crisisSooner or later, every organization is confronted with a crisis. In fact, most businesses must survive a series of crises during their company lifetimes. Proper planning minimizes the likelihood of the occurrence of some of these crises where they can reasonably be anticipated, but the unforeseen crisis is the one which requires immediate, intelligent and efficient intervention.

Global assists its client companies in such crises on a high-priority emergency basis. As soon as client company management recognizes either a seemingly unavoidable crisis headed for the enterprise, or is confronted with a totally unanticipated and crippling crisis where time is of the absolute essence and the correct response will literally determine the company’s fate, Global has the ability to immediately dispatch (either in-person or virtually) an Emergency Project Management Team (not unlike a S.W.A.T. team) to perform the following functions:

=> Consult with affected management to assess the nature, severity, time-sensitivity and threat level of the crisis;

=> Devise an immediate plan for damage and risk mitigation and containment;

=> Proactively advise and assist the client company in the implementation of all actions and responses necessary to either avert or minimize (through appropriate managerial protocols, negotiations, resource acquisitions, and the like) the damage on an ASAP critical path basis;

=> See the client company through the crisis until a point of stability and survivability can be reached;

=> Suggest and assist in the implementation of new strategies and protocols in order to prevent further damage or a recurrence of the crisis.

It is very important to note that when client companies first engage with us and integrate our professionals with their business planning team, Global insists upon a realistic, focused, incremental planning approach which incorporates contingency planning, assessment, avoidance mechanisms and containment strategies. These may include aspects of redundancy in systems and in management, various types of insurance, alternative distributor and supplier multi-sourcing, periodic sample testing and systems monitoring protocols, programmed drills and exercises – all of these with the end-goal of optimizing profits while minimizing risk and its resultant damage. While, as economists we are fully aware of the “risk versus return tradeoff,” our ideal engagement permits us to devise, assemble and assist a client in the implementation of a detailed “step-by-step” business operating plan which provides for the attainment of clear objectives given an “acceptable level” of risk.

Our planning and troubleshooting processes (which we use to pre-empt or at very least minimize the occurrence of foreseeable potential crisis risks crises include these tools, in addition to a great number of others, all of which are applied with Murphy’s Law in mind:

=> Contingency Planning;

=> Diversification Strategies;

=> Critical Path Analysis: By definition, Critical Path Analysis is a project-management or planning technique that lays out all the activities needed to complete a task, the time it will take to complete each activity and the relationships between the activities. Also called the “Critical Path Method”, critical path analysis can help predict whether a project can be completed on time and can be used to reorganize the project both before starting it, and as it progresses, to keep the project’s completion on track and ensure that deliverables are ready on time.
Either manually or using computer software, the project manager first lists each activity, the order it must be completed in and how long it is expected to take, and then diagrams the process;

=> S.W.O.T. Analysis: A SWOT analysis (alternatively SWOT matrix) is a structured planning method used to evaluate the strengths, weaknesses, opportunities and threats involved in a project or in a business venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective. Some authors credit SWOT to Albert Humphrey, who led a convention at the Stanford Research Institute (now SRI International) in the 1960s and 1970s using data from Fortune 500 companies. However, Humphrey himself does not claim the creation of SWOT, and the origins remain obscure. The degree to which the internal environment of the firm matches with the external environment is expressed by the concept of strategic fit.

  • Strengths: characteristics of the business or project that give it an advantage over others.
  • Weaknesses: characteristics that place the business or project at a disadvantage relative to others
  • Opportunities: elements that the project could exploit to its advantage
  • Threats: elements in the environment that could cause trouble for the business or project

Identification of SWOTs is important because they can inform later steps in planning to achieve the objective.

First, the decision makers should consider whether the objective is attainable, given the SWOTs. If the objective is not attainable a different objective must be selected and the process repeated.

Users of SWOT analysis need to ask and answer questions that generate meaningful information for each category (strengths, weaknesses, opportunities, and threats) to make the analysis useful and find their competitive advantage.

=> Computer Simulation And Sensitivity Analysis: Sensitivity Analysis is the study of how the uncertainty in the output of a mathematical model or system (numerical or otherwise) can be apportioned to different sources of uncertainty in its inputs. A related practice is uncertainty analysis, which has a greater focus on uncertainty quantification and propagation of uncertainty. Ideally, uncertainty and sensitivity analysis should be run in tandem.

Sensitivity analysis can be useful for a range of purposes, including:

  • Testing the robustness of the results of a model or system in the presence of uncertainty.
  • Increased understanding of the relationships between input and output variables in a system or model.
  • Uncertainty reduction: identifying model inputs that cause significant uncertainty in the output and should therefore be the focus of attention if the robustness is to be increased (perhaps by further research).
  • Searching for errors in the model (by encountering unexpected relationships between inputs and outputs).
  • Model simplification – fixing model inputs that have no effect on the output, or identifying and removing redundant parts of the model structure.
  • Enhancing communication from modelers to decision makers (e.g. by making recommendations more credible, understandable, compelling or persuasive).
  • Finding regions in the space of input factors for which the model output is either maximum or minimum or meets some optimum criterion (see optimization and Monte Carlo filtering).

Taking an example from economics, in any budgeting process there are always variables that are uncertain. Future tax rates, interest rates, inflation rates, headcount, operating expenses and other variables may not be known with great precision. Sensitivity analysis answers the question, “if these variables deviate from expectations, what will the effect be (on the business, model, system, or whatever is being analyzed), and which variables are causing the largest deviations?”; and,

=> F.M.E.A. Analysis: Failure Mode and Effects Analysis (FMEA) was one of the first systematic techniques for failure analysis. It was developed by reliability engineers in the 1950s to study problems that might arise from malfunctions of military systems. An FMEA is often the first step of a system reliability study. It involves reviewing as many components, assemblies, and subsystems as possible to identify failure modes, and their causes and effects. For each component, the failure modes and their resulting effects on the rest of the system are recorded in a specific FMEA worksheet. There are numerous variations of such worksheets. An FMEA is mainly a qualitative analysis.

A few different types of FMEA analyses exist, such as

  • Functional,
  • Design, and
  • Process FMEA.

Sometimes FMEA is extended to FMECA to indicate that criticality analysis is performed too.

FMEA is an inductive reasoning (forward logic) single point of failure analysis and is a core task in reliability engineering, safety engineering and quality engineering. Quality engineering is specially concerned with the “Process” (Manufacturing and Assembly) type of FMEA.

A successful FMEA activity helps to identify potential failure modes based on experience with similar products and processes – or based on common physics of failure logic. It is widely used in development and manufacturing industries in various phases of the product life cycle. Effects analysis refers to studying the consequences of those failures on different system levels.

Functional analyses are needed as an input to determine correct failure modes, at all system levels, both for functional FMEA or Piece-Part (hardware) FMEA. An FMEA is used to structure Mitigation for Risk reduction based on either failure (mode) effect severity reduction or based on lowering the probability of failure or both. The FMEA is in principle a full inductive (forward logic) analysis, however the failure probability can only be estimated or reduced by understanding the failure mechanism. Ideally this probability shall be lowered to “impossible to occur” by eliminating the (root) causes. It is therefore important to include in the FMEA an appropriate depth of information on the causes of failure (deductive analysis).

In addition to the techniques and methods briefly outlined and described above, your Global Project Management Team will use such other approaches and analytic technologies necessary to help make you business or your project successful by identifying, predicting and preparing for all of predictable sources and types of crises which may occur along the road to the achievement of your objectives. In summary, it’s far better to plan intelligently and comprehensively than to have to manage in a crisis mode.