Is your business ready for a crisis?

There was a product recall in Australia around 10 years ago which is now taught in Universities around the world on how it should be done. The company involved immediately put it’s Product Recall Program into operation and shut down production in the affected plants, retrieved all the suspect product and then went into a very carefully managed public relations campaign. Australians were kept informed at each stage of the operation and instead of turning against the company, as is the usual result of a recall, the public actually deliberately went into their local supermarkets asking for the brand, to give support to the company. The reason this is a test case, is because this company did everything right by the law and the public and actually increased it’s percentage of the market as a result.

The vast majority of companies after a recall suffer a loss of reputation and significant sales decrease, it can even put such businesses out of operation. So this is a very special case.

This is an example of a crisis managed very well, but most companies will not do so well if it happens to them.

Crisis management is an essential part of all business planning, but few companies do it well. It is a legal requirement for some companies to have a Product Recall Program, but most do not review it regularly. They do Mock Recalls to ensure the program is in place, but reviewing it at least annually is not something done by most companies.

Recalls are not required for all food businesses, but all businesses should have a Crisis Management Plan and review it regularly.

So what sort of things need to be included in a Crisis Management Plan as a minimum?

• Recall
• Food poisoning or suspected
• Supplier issues – eg; food safety, lack of supply, emergencies
• Major equipment failure
• Fire or other emergencies which stop production
• Tampering
• Staff issues – eg; vital roles missing, strikes
• Shutdowns in aged care, child care and hospitals

All businesses need to have procedures in place for these and any other crisis which may impact on that business, and these need to be reviewed and tested regularly, so when the thing happens there are no mistakes or things missed.