Crisis-Management Lessons from Katrina

I'm no big fan of "Neutron Jack" Welch, the hard-driving former CEO of General Electric. His abrasive, confrontational management style, evidenced in countless anecdotes and articles in the business press -- not to mention his own writings -- seems built on a foundation of management machismo that feels out of place in today's interconnected, interdependent and collaborative business world. That said, Welch is often right on management issues. Case in point: This item he wrote for the Wall Street Journal's op-ed page on the "Five Stages of Crisis Management" in the aftermath of Katrina.

It's a familiar and colorful litany: denial, containment, shame-mongering, blood-on-the-floor and finally, the crisis gets fixed. Welch highlights these behaviors in his outsider's view of the federal, state and local responses to Katrina's devastation. He also points out that businesses respond to crises in the same way -- though with far less extreme consequences. His key point is that a crisis -- any crisis -- is an opportunity to find out what's broken and learn how to fix it so it won't happen again.

It's easy to think of government entities and federal agencies (can you say NASA?) that don't seem to learn this. And there are plenty of business organizations that have not survived a big crisis -- think Enron, Arthur Andersen and the host of dotcom flops. There are companies in crisis now, like Merck and so many of the major airlines. Then there are those that faced a crisis and emerged stronger. Johnson & Johnson is one, whose response to the Tylenol tampering is a legendary business case for how to manage a crisis.

Welch says leaders in a crisis should have a "forthright, calm, fierce boldness." What he doesn't say is this: Successful crisis management is not just about senior leadership but individual responsibility. If any of us, at any level, in any organization, get stuck in denial, containment or shame-mongering, both our organizations and we as individuals will fail to learn. We will perpetuate failure, in our organizations and in our own lives, too.

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Jack Welch's latest book is Winning.

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