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Crises Find Our Heads in the Sand : In a Modern World, Our Responses Are Way Out of Date

<i> Ian I. Mitroff is a professor of business policy and director of the Center for Crisis Management at USC's Graduate School of Business. </i>

Once again, we have been hit by a series of “seemingly unrelated” crises.

--A death threat is directed against British author Salman Rushdie by Iran’s Ayatollah Ruhollah Khomeini, in turn endangering freedom of speech in the United States.

--Following a telephoned threat, the federal Food and Drug Administration imposes a ban on Chilean produce after trace amounts of a poison are found in two grapes.

--There is widespread fear that U.S. apples in particular and fruit in general may be widely contaminated by a broad range of cancer-causing pesticides.

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--A tanker runs aground outside the port of Valdez, Alaska, causing the largest oil spill in American history and endangering one of the most fragile and beautiful ecological areas in the world.

All are more related than they appear. And all contain some strong lessons about all crises.

Lesson No. 1 : All crises are now either global or have the potential to escalate very quickly up to the global level. Before the advent of modern telecommunications and jet travel, an incident of the magnitude of a Tylenol product-tampering, a computer-generated stock market crash, the Rushdie incident or the banning of Chilean grapes either would not have happened or would have been much less significant. Today, a psychopath can hop on a jet and contaminate foodstuffs and pharmaceutical products in multiple cities in one day. That’s why the threat of nationwide product-tampering has to be taken so seriously. In this regard, improved telecommunications and travel are mixed blessings, to put it mildly.

Lesson No. 2 : Denial is still disturbingly high. Terrorism, environmental accidents, product-tampering, etc., are still thought to be specific to certain industries or, worse, someone else’s problem. Six months or a year ago, someone talking to the major New York book publishers about the possibility of their industry being hit by a major incident of international terrorism would probably have been met with laughter or shrugged shoulders.

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Lesson No. 3: We have to bump from crisis to crisis until finally it dawns that no industries are exempt. All are subject virtually to every known kind of crisis.

Lesson No. 4: We invent and put into place complex technologies before we know how to control them or think about controlling them. Only after they fail do we then think of better methods of control. In the case of the oil spill in Valdez, our preparations for reacting to a spill have proven to be as fragile as the environment they were supposed to protect. Or consider the highly sophisticated, computerized trading programs that speeded up the volume of stock market transactions. Only after these systems played a significant role in the October, 1987, stock market crash did we ask the important question: “What organizational controls should we have put in place in case the technology doesn’t work?”

Lesson No. 5 : Our current institutions are a major part of the problem. We have mass media and computer systems that can spread information so quickly that they can shut down a nationwide food system at the drop of a hat. At the same time, we don’t have sophisticated information systems (although the technology is available) whereby as many of the affected parties as possible (i.e., the representatives of the Chilean and U.S. governments, the FDA, the FBI, retailers and distributors) can communicate freely to one another before, during and after a crisis in order to weigh collectively the best courses of action before one party, acting on its own, shuts down the whole system. It seems to take from 30 to 70 years after a new technology has been invented to create the appropriate institutions capable of managing it. This gap is no longer tolerable because crises not only happen with increasing frequency, but also because they are larger in their effects. We have to find better ways to learn and to redesign our institutions faster.

Lesson No. 6: Lacking better institutions and control mechanisms leads to “all or nothing actions,” such as taking all grapes off the market. It is akin to termite eradication before modern treatment methods: Either burn your house down or leave it alone, thereby potentially contaminating the whole neighborhood. When you have little or no controls, there is almost no room for graduated responses.

Lesson No. 7 : The worst time to invent social-control mechanisms is in the heat of a crisis. Armies have learned long ago that soldiers need basic training before they go into battle. While basic training may not be perfect, it lowers substantially both the physical and the mental casualties of war.

Lesson No. 8 : We’re running 21st-Century systems of vast technological complexity with outmoded 19th-Century thinking. In the 19th Century, it was appropriate to think and manage by “containment and isolation” because, for the most part, crises were confined in space and time.

Eventually, like we always have, our thinking (we hope) will catch up. But how many more crises will it take before we finally realize that, in every sense, it is no longer business as usual? Nothing less that a total redesign of our institutions is needed so that we and they can not only react, but prevent these crises from occurring in the first place. If we do not, then the mega-crisis may be the only area of production in which the United States will continue to lead the world.


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