The stereotype
of business crises is industrial accidents, oil spills and bizarre
crimes like terrorist bombings or the Tylenol incident. ICM's analysis
of business crises since 1990 indicates these 'no-warning' crises
are the minority. The majority are smoldering crises. In other words
management knows about them before they go public.
Another fallacy
is that most crises are caused by employee errors or natural disasters.
The reality is that most newsworthy business crises are the results
of management decisions, actions or inaction.
Crisis Categories Compared
1990 – 2004 (% of total crises each year)
1990
2002
2003
2004
Catastrophes
5.5
4.0
4.0
6.0
Environmental
7.8
2.0
2.0
3.0
Class Action Lawsuits
2.2
20.0
1 0.0
1 3.0
Consumer Activism
2.8
2.0
5.0
5.0
Defects & Recalls
5.4
13.0
1 4.0
6.0
Discrimination
3.3
3.0
5.0
5.0
Executive Dismissal
1.3
1.0
2.0
2.0
Financial Damages
4.2
3.0
3.0
4.0
Hostile Takeover
2.6
1.0
1.0
1.0
Labor Disputes
10.3
11.0
9.0
12.0
Mismanagement
24.1
11.0
12.0
14.0
Sexual Harassment
.4
1.0
2.0
2.0
Whistle Blowers
1.1
1.0
1.0
1.0
White Collar Crime
20.4
14.0
17.0
17.0
Casualty Accidents
4.8
4.0
7.0
6.0
Workplace Violence
3.8
11.0
5.0
4.0
ICM
455 S. Fourth Street, Suite 1490
Louisville, KY 40202, USA
Phone: 502-587-0327
Fax: 502-587-0329
