long term sign

Crisis simulations as planning tools

Critical takeaways

  • Simulations are the most valuable planning and preparedness tool available to an organization and should be a routine part of every company’s training regimen.
  • We are now investigating how to use simulations as planning tools to help organizations develop contingency plans and scenarios for future challenges.
  • Outlined here are four principles to help you plan and deliver a simulation as a scenario-planning tool.

 

As I’ve written repeatedly, we at Kith are firm believers in the value of crisis simulations as a way to improve organizational performance in the event of a crisis. We believe that simulations help develop preparedness in multiple ways. For example, a well-run simulation will:  

  • Identify gaps in your planning process and organizational preparedness.
  • Help you understand the skill sets and expertise of individuals and teams.
  • Create an opportunity for newer / junior members of your team to learn as they participate alongside more experienced team members.
  • Develop corporate ‘muscle memory’ allowing you to react more quickly and decisively in a critical moment.
  • Improve the ability of individuals and teams to overcome fear and shellshock.
  • Help you understand relationships and develop alignment between teams, e.g. communications and legal.

 

Time and time again, we have seen the tangible benefits of simulations when a crisis strikes and there is a marked difference between teams who have practiced and those who have not. There’s no doubt in my mind that a well-crafted simulation is the most valuable preparation tool that an organization can employ.

However, there’s one new benefit we are starting to explore and that’s the use of simulations as a long-term planning tool.

This was prompted by a recent request from a financial services client who wanted to expand the scope of a typical crisis simulation. They want to use lessons from the simulation as part of a long-term planning exercise they’re conducting in case of an economic downturn. In addition to the general improvements to preparedness I listed above, we identified three benefits that a simulation would bring to their planning.  

Firstly, they would be able to see where their teams may have knowledge or skills gaps that relate to this specific scenario so they can work to plug those. Secondly, they could stress-test their existing contingency plans and scenario-specific strategies. Thirdly, they could evaluate how their response to a downturn could be used as a comparative advantage relative to competitors.

This was an innovative idea and it really got us thinking. The more we thought about it, the more potential we saw but we also realized that using a simulation for planning, as opposed to just preparation, requires some adjustments.

I’d like to share some key differences we identified to assist if you plan to use a simulation in this way.

 

Focus on long-term planning, not short-term reactions

Unlike typical crisis simulations, which usually deal with an acute issue requiring a quick response, a planning simulation needs to address a longer timescale.  So you need to build a simulation that covers a timescale of weeks or months rather than just focusing on the reaction in the hours or days after the event. Allow the participants to consider a set of issues, plan how they will respond and initiate the response as normal but then, instead of playing things out in real time, jump ahead a day or two. Provide realistic updates of how their actions were received and deliver an updated set of challenges. This will allow you to cover a reasonable timescale for the management of a chronic crisis in a short amount of time. This also allows the participants to consider the longer-term, second and third-level effects of how they might respond which will be vital for effective planning.

However, you need to stay at the strategic-level for this kind of simulation to work and keep an ‘infinite’ mindset.

This requires careful participant management and willing suspension of disbelief in order to be successful: someone will always want to relitigate the last session or jump into the tactics.  There’s also not as much of a clear start and end to the scenario which can be difficult for some participants. Ensure that you warn all participants in advance that this is a different style of simulation. Remind them that the goal is to plan for a more chronic, long-term issue, not just practice the immediate response to a crisis.

 

Get senior leadership buy-in

These simulations are wholly strategic so you need to get the highest levels of the organization involved, up to and including Board Members. Because of the involvement of all senior leadership, the simulation needs to be wholly credible as a scenario and well run as an exercise.  We all are mindful of the collective eye roll from senior leaders when they are confronted with another ‘milquetoast’ exercise around what could happen in some hypothetical construct.

Therefore, make sure that you build something robust and challenging that’s going to be worthy of their time and make them think. Use analogous historical events, the experience of competitors and what you can learn from academia to build a credible, realistic scenario to maximize the benefit they derive from the exercise. This will keep your senior leaders engaged and will also bolster your credibility as someone who ‘gets’ strategic planning and as a confident, trusted counselor.

 

Ensure that actions have consequences

All too often we see a poorly run scenario where we hear the following. “Yeah, so we fix that” or “we issue a statement to deal with that” and the problem miraculously fades away.

This never happens in reality.

In reality, the response never goes according to plan and no matter how good your statement, someone will react negatively to it.  Actions have consequences in real life so they must also have consequences in training. Otherwise, you are reinforcing false lessons which will erode crisis preparedness.  Moreover, by not challenging the participants you won’t be able to identify the skills gaps to close or the dynamic challenges that an ever-changing marketplace would create.

So include additional inputs to simulate things going wrong. Maybe the CEO doesn’t make it to the studio in time for her big ‘mea culpa’ interview.  Or the recall gets botched. What if your competitors start running ads against you?  This might seem tough on the participants but this will result in a much more realistic set of circumstances to help their planning.

 

Play as the opposition

In foreign affairs discussions or military planning you will often hear people say “the enemy also gets a vote” as a reminder that, no matter how good your plan might be, there are other factors at play.  This is going to be the same in planning for a strategic crisis in your organization. The success of your plans will often be directly related to what your competitors may be doing. This means that you need to have someone play the ‘opposition’ as an active element in the simulation.  Their role is to create additional challenges to reflect the kind of actions competitors will be taking and to play out how third-parties will react to what the participants do.

For example, we might include some very proactive, very aggressive competitors or have a new rival firm appear on the scene to take advantage of the situation.  This adds realism but also forces the team being trained to ask, “Could we respond to this? Or “what would we do in this situation?“.

 

Graduate level simulations for graduate level problems

The goal of all crisis simulations is to identify problems before you’re actually in the middle of the situation. This can be preparing contingency plans or plugging skills gaps that the simulation has revealed.  However, using simulations for planning takes this to the next level. This allows you to challenge your senior leaders to address the most difficult problems that they might face in a crisis and to develop appropriate contingency plans. These simulations are significantly more difficult than a ‘routine’ exercise – which should still be challenging – but only this style of simulation will let you tackle the biggest problems.  

So the next time you are thinking about long-term strategic planning, consider using a simulation as a planning tool. I think you’ll be pleased with the outcome and these will definitely be a key part of Kith’s toolkit going forward.