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The Talent You Need for Crisis Leadership

No matter how smoothly an organization usually runs, there will inevitably be bumps in the road. When those little speed bumps turn into a full-blown crisis, having the right HR executive leadership in place is critical for turning things around. So, what does crisis leadership mean for the HR team in today’s business world?

 

Today’s Crisis Situations

A “crisis” can mean any number of things in today’s business world, with any number of unique complications and inciting factors. In general, a crisis happens when an event occurs that has a sharp, negative impact on the organization as a whole. It might be something that has long been anticipated or completely out of the blue. Either way, effective HR executive leadership is crucial to resolving these crises.

 

One of the most common types of crises affecting companies today is ongoing issues with the workforce. Specifically, companies are still dealing with the effects of the COVID-19 pandemic and the Great Resignation, with employees leaving and changing jobs in droves. In 2021, approximately 47 million Americans left their jobs, whether for retirement, a different job, or even with no new job lined up. The Harvard Business Review breaks down the “five Rs” of what’s motivating the workforce shift:

  • Retirement: Some people are taking advantage of buyouts to retire early, or simply deciding it’s time to go.
  • Relocation: Fewer workers (and retirees) are relocating.
  • Reconsideration: The cultural shifts of the past few years have led many workers to reprioritize their lives and weigh the importance of values like work-life balance.
  • Reshuffling: Rather than leaving the labor market entirely, some workers are choosing to make more localized moves, accepting new jobs in their same industries, or even switching industries to suit their current needs and priorities better.
  • Reluctance: Pandemic-related concerns are still impacting the kinds of work and work environments that people are willing to accept, especially when it comes to in-person jobs.

On their own, these individual choices might not constitute a crisis. For many organizations, the highly competitive labor market, combined with long-term concerns such as health & wellness and diversity & inclusion, is resulting in something of a labor crisis.

 

Strong and thoughtful leadership could have stemmed the tide for many organizations. Even before the pandemic, something so simple as leaders checking in could have significantly helped with retention, thus avoiding a labor shortage crisis. One 2019 Gallup poll revealed that 52% of exiting employees said their employers could have done something to make them stay, and 51% said management failed to speak with them about job satisfaction or their futures.

 

Organizations may also face reputation and PR crises from time to time. This can run the gamut from a minor gaffe to a major scandal, and each needs its own strategic approach. Because of the sensitive nature of these crises, it’s crucial to have leadership in place that can immediately be present, make frustrated stakeholders feel heard, and take steps towards resolutions with the most favorable outcomes.

 

A critical area many companies are monitoring is diversity, equity, inclusion, and belonging. Research from Gartner revealed that organizations with sustainable DE&I initiatives show a 20% increase in inclusion, which corresponds with higher performance and retention. On the flip side, organizations not prioritizing these aspects may face a crisis that affects everything from PR to hiring and, ultimately, profits.

 

What Does Crisis Leadership Look Like?

A Chief Human Resource Officer who can be effective in a crisis tends to possess certain traits. How can we identify those traits when recruiting for this position, and what unique combination of traits makes a leader strong in a crisis?

 

In a conversation with Strategy + Business (S+B), Laura Fuentes, the CHRO of Hilton, described a concept called the “crisis quotient”: a leadership value, similar to the “intelligence quotient” or the “emotional quotient,” that can make a significant difference when leading in a crisis. S+B described this “CQ” as “the ability to simplify complexity, prioritize, make decisions when you don’t have all the facts, and change your mind… the ability to lead with compassion and understanding for what people need and want, and be able to balance a greater focus on listening with knowing how and when to make tough decisions.” This combination of psychological and strategic traits can help indicate strong leadership qualities in a crisis. In challenging moments, the best leaders are the ones who can be flexible and attentive to the unique needs of the organization.

 

Harvard Business Review describes two critical components for effective crisis leadership: “containing” and “holding.””Holding” is a psychological term referring to authority figures who focus on explaining and reassuring those they are responsible for in times of crisis or uncertainty. “Containing” is part of that: calming ruffled feathers, ensuring everyone is on the same page, and giving a clear, helpful explanation of what’s going on so that people can stay informed and see the path forward. Leadership combining holding and containing helps teams stick together and continue to work effectively, rather than panicking and exacerbating the crisis.

 

Even when there’s no immediate crisis, this kind of leadership thinking can be a tremendous asset to a company. HR leaders who maintain this approach can keep the organization successful, using the power of anticipation and preparation to avoid a future crisis. Concentrating on a few key factors can help you keep priorities in mind when it comes to avoiding workforce and labor crises. We recommend three overarching areas for leaders to focus on: the employee value proposition, reboarding current employees, and investing in a culture where belonging plays a starring role.

 

Hiring Crisis Leaders

Trying to rush a hiring process or bring in outside consultants won’t be nearly as effective as having the right HR leaders already in place when you’re in the thick of a crisis. So, what should organizations be looking for as they make contingency plans and recruit leaders?

 

While it may be tempting to see crisis leadership as big moves and bold visions, the reality is that those quieter, steadier qualities define a leader who can stabilize and steer during times of trouble. Leaders with a track record of adaptability and creativity who have successfully led an organization through challenging times should be prioritized.

 

Great crisis leadership is less about who can paint a pretty picture and more about who can steer the ship with confidence, keep it steady, and keep everyone on board. Focusing on core values, active listening, and maintaining stability will assist the organization through any crisis. Still, an excellent leader will make all the difference in how successfully you reach the other side.

 

By Ruben Moreno

 

About the Author

After a 25-year career in Corporate Human Resources and HR Executive Search, Ruben Moreno and his two partners co-founded Blue Rock Search based on a simple but ambitious vision of creating a firm that would “Change Lives and Organizations One Relationship at a Time.”  Ruben leads the Blue Rock HR Executive Search practice specializing in the identification, assessment, recruitment, and onboarding of Chief HR Officers and Chief Diversity Officers and their respective teams — inclusive of leaders in Talent Acquisition, Total Rewards, HRBP’s, Learning & OD, HR Technology, HR Operations, and HR Analytics. Ruben has helped place hundreds of HR Executives and built deep relationships within the CHRO community across multiple industry verticals. His clients consider him a trusted partner who takes the time to understand their business and add value beyond executive search.

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