Organizational Crisis Essay

Organizational crisis can come in many different forms. It can range from a natural disaster such as a tornado, earthquake or tsunami, to a manmade disaster such as a terrorist attack, to an internal disruption such sudden downsizing and shifts in leadership. Although there are several different definitions of crisis, one of the most adequate definitions defines crisis as a situation that incorporates an element of surprise to decision makers and employees, a threat to high-priority goals, and a restriction of time available for response (Hermann, 1972 & Choi, J. N., Sung, S.Y., & Kim, M. U., 2010). Regardless of the type of crisis, the amount of disturbance, disruption, and chaos can cause rifts in the organizational culture and work environment

As market values declined and organizations lost money, many organizations, experienced declining assets and sought a number of options to relieve the financial strain. As a result, organizations were forced to downsize and layoff individuals just to maintain existence and survival after the economic financial crisis. In 2009, employers laid off about 2.1 million workers in 11,827 private nonfarm extended mass layoff events. The numbers of layoff events and separations in 2009 registered their highest levels since annual data became available in 1996 (U. S. Department of Labor, 2010). Within an organization, layoffs are crises that are triggered by external factors. Like most crises, layoffs agitate the organizational culture and create disturbances that cause for shifts in workloads, declining employee morale, and increased insecurity and anxiety. Even in this type of crisis, organizational leaders need to be able to make sound decisions, limit chaos, and retain organizational character and

Organizational leaders have a special responsibility to help safeguard their organizations and its stakeholders from the adverse consequences of a crisis (Santos, Mello, & Cunha, 2016). As organizations work to restore financial stability and rebuild their workforce, they are also exploring better investment opportunities that provide more protection to their assets, which are not just limited to monetary value, but also specific to retaining those employees that remain after the downsizing and layoffs. In membership driven companies that rely heavily on external partnerships, those organizations must also work diligently to rebuild those partnerships with stronger promises of protection and added security so that the members are fully confident in the services that the organization