Crisis management

Crisis management in the energy and resources industry

Continuously resilient

Energy and resources are the lifeblood of society. When that flow is threatened or disrupted by crisis, the effects can ripple into economies, cultures, and livelihoods.

The spectrum of crisis triggers ranges from technology infrastructure and outages through natural disasters, cyber threats, regulatory action, geopolitical threats, and environmental damage. To meet the dangers, including lasting harm to reputation and value, organizations must prepare, be vigilant for the emergence of threats, and resilient in recovery.

There’s a difference between the organizations that rebound from crisis and the ones that don’t. It starts with planning – and it takes a kind of agility that traditional project management methods can’t produce. It’s vital for organizations to build robust crisis plans and keep those plans up to date. That way, they can keep the resource chain unbroken no matter what crisis may arise.

Surprises lurk within the known
Preparing for a crisis means identifying the vectors that will affect your organization. And sometimes, the obvious crisis can mask your awareness of a more serious threat 90 degrees to the side. For example, a data center flood probably feels like an IT crisis. When you realize you have a viable alternate site but not enough electricians available to connect it, the same event can become a personnel crisis as well. A physical accident may turn quickly into a fiscal crisis. The SCADA (supervisory control and data acquisition) problem that feels like an operational issue may also be a safety issue. Whatever the apparent threat, there may be an accompanying threat that lack of awareness may bring game-changing danger.

Anticipate, prepare – and think long-term
The time to know how well your crisis management plan applies to the threats you actually face is not the moment when your future depends on it. By the time crisis strikes, an organization should have amassed the confidence and self-knowledge that can come only from analysis, scenario planning, and simulation that looks beyond a single moment. It’s one thing to address business continuity. It’s another thing to look beyond that to long-term resilience.

New threats on top of old ones
To face a crisis with confidence, energy and resources organizations need to preserve long-held beliefs while embracing new realities. The industry has traditionally focused on a culture of physical safety, from oilfields to control rooms to transmission grids. That remains critical. But now the lines between information and physical safety are blurring. For example, cyber threats have made their way into physical safety systems. Preparing for a crisis today requires a visionary approach by organizations to ensure safety transcends all aspects of your business.

The energy and resources industry is global and interconnected. To fulfill its business strategy – and to meet its minute-to-minute obligations to customers and other stakeholders – each company relies in one way or another on continuity and reliability. Disruptions that affect production and markets can also affect the natural environment, public health, and social order. Organizations that operate in this field spend every moment at the intersection of all those threat vectors and effects.

How to start
Start from the top. Because that’s where crises finish. Boards and senior management set the tone for a culture of risk intelligence. Some can invite complacency by appearing uninterested. Some can create tension by taking too active a role. But an informed, involved leadership team can keep crisis management on target.

Tear down the silos. Including the one that surrounds your entire organization – the one between you and your third-party relationships. External relationships are a critical piece in both operations and potential threats. Failure to see the big picture only heightens the threats to an organization’s entire reputation, its value, and even its existence. Build preparedness and resilience across and beyond your landscape. Crisis doesn’t respect silos, so your crisis plan shouldn’t either.

Prepare the people. Triggers, procedures, and countermeasures are the limbs of a crisis management plan. People are the brain and the heart. If you think “survive,” then survive is the most you’ll do. If you think “bounce back stronger,” the effort you put into being attentive as well as training and overall preparedness, you can create a true culture of resilience.

The Focus on series is part of Deloitte's commitment to provide insights that help board members and senior executives navigate the crisis management lifecycle, including readiness, response, and recovery.

Download the PDF to see how the world’s leading companies are addressing crisis management issues.