After the Crisis

Don't waste the opportunity to learn

Few things focus executive attention like a crisis. By definition, crises are events that are not anticipated or for which no recovery plan exists. Cyberthreats may be anticipated but companies and oil pipelines have been crippled by them nonetheless. An earthquake may be a total surprise, in which case there is unlikely to be a protocol to follow. Recently, one my clients experienced a fire at a key factory that could set back order fulfillment by months. There was no store of inventory held in reserve; who could imagine needing it?

CEOs are told to have an emergency succession plan in place in the event of health issues or being hit by a bus. Yet there was no way that Brian Thompson could have anticipated that he would be targeted by an assassin on his way to an early morning meeting in Manhattan on December 4, 2024. While Thompson had a few “ready now” successors in place, it took until January 23^rd of 2025 for UnitedHealthcare to name Tim Noel as its new CEO. Noel was an insider and was chosen in part to stabilize the situation.

Nevertheless, Thompson’s murder and the attraction it drew to United’s claim management practices resulted in a shift in policy toward a less aggressive stance, resulting in reduced revenues and missed targets for the first quarter. A group of shareholders then sued the company over its lack of transparency, claiming they had been deceived by financial plans released prior to Thompson’s death. Who could have anticipated any of this? And yet it happened.

Companies should expect bad things to happen. There are always bumps in the road, some small and some enormous. It’s hard to prepare for the unimaginable, so risk prevention can only help so much. Instead, organizations can use forced recoveries from unexpected shocks to build deeper resilience and a larger menu of options to choose from. Doing so takes an intentional approach.

The modern approach to developing resilience versus crisis recovery is different in several respects.

First, crisis recovery is viewed as an event to be managed, followed as quickly as possible by a return to normal. That was evident in the cases of United Healthcare and my client’s factory fire. The immediate focus was on getting the company back to where it was, not on what was learned that might be important for the future. Enhancing resilience involves learning what needs to be changed to avoid similar threats in the future, which requires investigation, careful thought, innovation and finally experimentation with new ways of operating.

Bolstering resilience also means not waiting for the next crisis to occur. As in risk prevention, the organization needs to imagine what could happen that hasn’t happened yet and develop plans to respond should those things take place. But beyond what is done in risk prevention, building greater resilience means doing more than imagining. Leaders should experiment with responses in simulated situations to develop “muscle memory” should the worst happen and also to verify that the approaches perform as imagined.

Rather than taking place annually, resilience building needs to take place continuously as new signals of threats are detected. Rather than archive concerns that aren’t raised until the year-end crisis prevention exercise, work should be done on concerns as they are identified and appropriate actions taken before threats materialize. Creating the psychological safety that is required for people to voice their nascent concerns requires ongoing attention to the health of the organization’s culture.

If a crisis does occur, one of the things the organization needs to learn to do is to take control of the narrative. Rather than burrowing down and staying out of sight until a response is fully formulated, immediate transparency will diffuse the rumor mill and allow leaders to retain their ability to influence decisions. When the press fills the vacuum of information, leaders may be left defending themselves instead of gaining respect for their response to the crisis.

Finally, after a crisis occurs, there needs to be a dedicated effort to learn what worked and what didn’t. The goal is to create what is known as “antifragility” which is the result of strengthening processes that failed and inventing new processes that will reduce future exposure to disruption. Rather than hurry to put the incident behind them, leaders need to get serious about learning everything they can from what they endured. After all, they paid the price so they might as well seize the rewards.

We have all had some things that have gone wrong in our lives or produced fewer gains than we imagined. If you think about those things at a personal level, you can understand why it can be difficult to learn from our mistakes. We want to leave the pain and disappointment behind as quickly as possible. Dissecting what we did to put ourselves in that position and then not to be able to recover as well as we would have liked is not fun. We would rather move on without going through the painful exercise that would provide us with the self-insight we need to not do that again. If people were good at this, there wouldn’t be so many failed second and third marriages.

Then, even if we do pause to reflect, we might misplace the blame for our misfortune elsewhere. We tell ourselves the world isn’t fair, other people are evil, or we were just unlucky. Excuses like these relieve the pain and justify avoiding deeper questioning.

Finally, our well-intended friends or supporters tell us it wasn’t our fault, that we didn’t deserve what happened to us. Our friends, unless they really are true friends, don’t tell us straight up that we blew it and better take responsibility for what happened. True, we didn’t cause the earthquake, but we didn’t prepare for the business to be disrupted either. We sat fat and happy until suddenly things changed.

Bad things will happen. Building resilience by creating antifragility is a good investment in the future. But hey, while I’m at it, I should point out that unexpected good things will happen too. Resilience isn’t just about recovering from a disaster. It’s about being ready for anything and making the most out of the opportunities before us.