Control Costs

It has happened to you

Imagine… it has happened. You have a serious incident to manage. The period of intensive incident management that has just begun may last only a few hours, or maybe much longer.

You will be using your internal resources, in accordance with your Incident Management Planning. Hopefully your training included scenario based exercises so have had opportunities to practice.

You are likely to need your external suppliers. They may provide you with specialist support in various fields such as: legal; crisis PR; psychological support; insurance; accident investigation and so on.

The decisions you make will inevitably have a price tag attached to them. Ordinarily you may baulk at any non-essential cost. Your mantra might be that all costs have an impact on your bottom line. Staff may even be fearful of any expense that might turn out to have been unnecessary. So you would normally refer any request for extra spending up the line to senior managers – even when doing so might use up valuable time.

Any organisation should carefully consider the consequences of its decisions; including the cost of providing a good response.

What can go wrong?

Unfortunately that responsibility cuts both ways. You must also consider the cost of NOT providing a good response. A poor response increases the risk that you will generate uncontrolled costs that emerge later. These can include:

• demands for compensation and refunds
• litigation
• increased staff turnover & absenteeism
• troublesome HR procedures
• loss of productivity due to staff distraction or disillusionment
• loss of income due to reputational damage
• loss of income due to customer boycott or protests

Yet it may be impossible to determine during the early stages of managing an incident whether or not it is likely to generate uncontrolled costs.

Your most valuable commodity when managing an incident is TIME. Attempting to ‘second guess’ the eventual outcomes is likely to cause delay. Wasted time can never be retrieved but it may make the outcomes worse.

Money ISN’T a dirty word when providing psychological support and high quality Incident Management. It is sensible and necessary to take cost into account.

Can you trust our advice?

Like an other supplier Clarity could be accused of simply trying to sell more of our services. However, it isn’t in our interests to encourage customers to unnecessarily buy services that, in hindsight, are seen to have been unnecessary. Such a strategy would soon be recognised and our customers would desert us.

Our sincere objective is to help our customers achieve the best outcomes they can in incident management:

• reduced psychological distress
• protected reputations
• controlled costs

Recommendations

After many years of experience and feedback from customers and insurers we can summarise our observations and recommendations.

1. Delaying or seriously limiting your response to an incident in order to try and avoid the expense of paying for optional services will sometimes translate into uncontrolled costs later.
2. It is better to risk over-reacting early on. It isn’t difficult to scale down your response once the fog has lifted. But it is difficult to scale up, and it is impossible to retrieve lost time.
3. Your Incident Management Plan should contain a willingness to ‘spend now to save later’. And it should include an authority to spend (up to a specified limit) that is delegated to named roles within the Incident Management Team.