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The logbook’s time stamp read 2330hrs AST, 200 nautical miles from the coast of Yemen. One of
the biggest vessels in the world was making its way to Rotterdam. The vessel’s engine room was
200 meters away from the accommodation where the crew rested and navigation duties conducted.
The lone duty engineer had just finished his night rounds and was about to leave when the
suffocating smell of diesel pierced his nostrils. Within minutes the odour numbed his sense of
smell. He notifies the bridge of the situation and enters the engine room all alone to locate it. He
found the leak to be in the purifier room filled with fumes as the diesel was spraying on hot
equipment running at least 50°C above its flashpoint.
Drucker Forum 2021
A shiver went down his spine as he realised the whole room could explode at any moment,
engulfing the entire ship and her crew. He was staring at death! He had two options- flight or fight,
and he chose the latter as help was 200 metres away resting, oblivious to the dastardly danger
unfolding in the aft of the vessel. For the first time in his life, did the duty engineer experience the
dynamicity of time. Time slowed for him, his vision tunnelled, training kicked in, and the countless
flow charts he had memorised three years ago about containing a spill came flooding back to him
in a structured and pointwise manner.
As he struggled to move, being bogged down by the fierce fumes, he covered himself in a fire
blanket and proceeded to spot the source of the leak. The suction side of the emergency diesel
pump had got pressurised due to faulty design, the spliced O-ring gave away, and the pump was
spraying diesel everywhere. Soaked in diesel, he closed both the suction and discharge valve and
shut the valve from the tank. The blower was found switched off as part of cost-cutting initiatives;
he promptly turned it on in the exhaust mode. Next, he shut down all the purifiers and other
ancillary pumps, removing their diesel-soaked insulation and wiping it with soap-soaked rags.
Once the fire source was eliminated, he called his supervisor to muster the engine crew for clean-
up operations. 250 litres of diesel had leaked on the ship, 24 souls were on board, and the duty
engineer who came to everyone’s rescue was just 23 years of age!
I was that duty engineer!
As I pursue my MBA surrounded by the perceived sense of safety and security the shore offers, I
cannot help but recollect the multiple situations that I had to face over a short yet memorable career
at sea and how my seniors and I handled dangerous situations which was a recurring theme at sea.
From spanners to spreadsheets, it’s true that the tools have changed, but the human element is the
same. This essay is an amalgamation of my insights from my experiences at sea, Drucker’s
management philosophy, and the various primary and secondary research conducted.
Some of the earliest studies on crisis management were undertaken by Charles F. Hermann, who
defined crisis as a stimulus characterised by an unexpected threat to an entity with a short response
time1. A more recent definition of crisis is that it is a perception of an unpredictable event that is a
threat to stakeholders and generates adverse outcomes2.
While multiple studies were conducted on the topic with various conclusions, one commonality was that crisis is unpredictable if not
anticipated. This makes it somewhat unique as it can be viewed more as an opportunity than a risk
to the establishment. Interestingly, the Chinese recognised this and their symbol for crisis is 危机
, where 危 stands for risk, while 机 stands for opportunity3. Drucker went a step ahead and
considered crisis only as an opportunity for companies to undergo a metamorphosis into a much
leaner and better-prepared organisation.
Like the shape-shifting Greek God of the sea, Proteus, a crisis can come in many forms and shapes.
However, it can be classified into premeditated and unintentional. Premeditated are those nefarious
acts that are pre-rehearsed to cause harm to the reputation of the institution4. While the first thing
that comes to mind is the 9/11 attacks or the 26/11 Mumbai attacks, other acts like product
tampering and cyber-attacks also form part of this cohort. Unintentional crises are those occurring
due to force majeure or act of God like natural disasters or accidents. Understanding them and
their nuances is what enables managers to build upon them or crumble under their weight. While
crisis and its classifications are important, another primary classification is the manager, the person
under the spotlight, the human element in the chain of entangled consequences. What about them?
The managers are broadly divided into two, in-situ and ex-situ. Their functions and stress levels
vary with rank, with the executives and chiefs experiencing higher stress5. The Italians captured it
well when they said, “Il pesce comincia a puzzare dalla testa” or “the fish begins to rot from the
head”. Drucker captured it better when he said, “the spirit of an organisation is created from the
top. And so, if it decays, it does so because the top rots”6. However, there are certain common
qualities that a crisis demands of all managers and the following paragraphs try to dwell on those
characteristics.
Effective Decision Making
In 2014, I had just joined merchant shipping as a cadet. We were transiting the Gulf of Aden,
which at that time was the hotbed of Somalian piracy. Around 0200hrs IST, the piracy alarm was
sounded, followed by the captain announcing that a vessel hardly ten nautical miles in the corridor
had come under attack. To make matters worse, some of the pirate boats were approaching us. To
our dismay, the main engine gave away and shut down at that moment, dropping our speed from
24 knots to zero in no time. We could hear the panic in the captain’s voice- if the engine didn’t
start, we would be boarded and taken hostage. I got an earful from my second engineer when I
asked how I could help amidst the crisis. Sulking, I went to the control room, where I saw the chief
engineer enter while flicking his adjustable spanner. He inquired about why I looked pensive, and
I told him the source of my misery. He chuckled and told me to follow him.
He calmly checked the various parameters, which were normal. Then he thought for a while,
scratched his bald head and smiled. He looked at me, and imitating the second engineer, said,
“Cadetsky, Let’s start her up, shall we?”. The chief engineer takes a mallet and starts gently tapping
a pressure relay. I hear a hiss of air release from the aft of the engine. Without even testing it, he
picks up the radio and tells “start her up; she is all yours”. Within minutes we built the required
speed and escaped from receiving inexorable Somalian hospitality. I always wondered how he and
other effective managers usually did the right thing without making many mistakes, and this
exhorted me to research errors.
Would anyone believe an uncanny connection exists between a Federal Aviation Authority study
on civil aviation accidents and the lyrics of British hip-hop singer Rag-n-Bone Man? Interestingly
there is, and that is that both acknowledge humans make mistakes! While the FAA study attributed
that 66% of civil aviation accidents are caused by human error, Rag-n-Bone Man’s single ‘Human’
with the lyrics “I’m only human, I make mistakes, I’m only human, That’s all it takes” went on to
top charts world over.
These mistakes are of three types, namely, Decision Errors, Skill-based Errors and Perceptual
Errors7. When handling a crisis, a manager must be wary of these errors and avoid them actively.
While the literature argues that complacency, bias and prejudice creep in with experience and thus
hinder logical decision making8, I have observed that skill-based errors are significantly less
among senior managers. In contrast, it’s high among the junior managers. I have come to
understand that experience plays a critical role in making effective decisions in the time of crisis
which, according to Drucker, is doing the right things more than doing things right9. Another
reflection I have is that the managers I have worked with take decisions rapidly as the response
time for a crisis are very short. While one may argue that haste leads to waste, a study by the CEO-
Genome Research team at ghSMART substantiates the opposite after conducting over 20,000
leadership assessments on C-suite executives10.
Communication
When the Libyan civil war peaked, close to 250 personnel of a German drilling major were spread
across eight platforms separated by thousands of kilometres of desert. Extracting them safely from
a war-torn country was a crisis both the senior management and in-situ managers had to handle.
Cellular networks were down, rumours were running amok, and there was general panic at the rigs
and among the concerned family members. This is where effective communication played a
significant role, as recollected by one of the senior executives who led the evacuation operation.
They established a communication centre and had one member from the rig to whom they relayed
information. Further, the senior management kept regularly informing the board of any updates.
They also opened a channel with the family members and kept them posted, and provided
counselling. Most importantly, they laid strict restrictions on any member using social media or
talking to the press as all communication was to be done through the communication centre to
prevent rumours and information leakage.
Establishing proper channels of communication, controlling the spread of misinformation, dealing
with the press and having two-way communication channels open with a centralised Crisis
Management Team are critical to coming out of a crisis. A manager must engage in active
communication all along this path to prevent information asymmetry and ensure information overload does not occur. While one may be tempted to believe that some people are born communicators, crisis communication is a whole different ball game, and people need to be trained to do so.
The Silver Lining!
The financial crisis of 2008, followed by predatory pricing with rivals and a heavily diversified
portfolio, had the managers of the Danish giant A.P. Moller Maersk peer at a crisis bloom like a
repulsive rafflesia right in front of their eyes. The managers had dark clouds looming over their
heads, but they saw the silver lining- the opportunity in crisis. They implemented, perhaps unaware
of Drucker’s The Past, Present and Future model11. They incorporated an organisational restructure
that included divesting Maersk Oil, investing in innovation, moving the shipbuilding activities to
Korea, and building efficient vessels like the Triple E generation that was 35% more fuel-efficient,
thus reducing operational costs12. Further, they worked to be a data-driven shipping company and
actively engaged IoT in their businesses13 to be future-ready. They saw the crisis as an opportunity
to become a lean organisation and successfully did it. Would they have been this same innovative
company hadn’t the financial crisis occurred? That’s a question best left to the webs of time. But a
question that demands our attention, especially in the volatile world of ours, is whether these
qualities exhibited by Maersk’s manager are inherent traits or acquired through training?
Born or Forged?
“Even the smallest person can change the course of the future”,
Lady Galadriel from The Lord of the Rings, J. R. R. Tolkien
As inspiring as the quote may be, research has shown that the presence of the genetic marker
rs4950 is associated with leadership. Furthermore, multiple studies on twins who act as a control
for each other have shown that these traits are influenced by genetic relationship; in other words,
they are inherent traits and that leaders are born14. But does it stop someone from acquiring these
traits and becoming a successful leader? Drucker wrote, “There may be natural-born leaders, but
there are so few of them that they make no difference in the greater scheme of things”. In line with
his thoughts, my favourite definition of leadership comes from the US Army Field Manual. It states
that leadership is an influential process in which the leaders provide purpose, direction, and
motivation to improve the organisation. When one speaks about improvement, it is implicit that
training and acquiring new skills and knowledge is inherent to the process. Different researchers
on the subject may give different conclusions, but the fact that the total training expenditure in the
United States rose from $ 70.6 Billion to $ 83 Billion in just five years15 and close to 57% of L&D
professionals have Leadership and Management Development as their highest priority16 goes on
to show what the industry believes. As more research is being conducted on improving training
standards, organisations are trying to bridge the knowledge gap present. With modern simulators
and training tools like DC-Train17, managers are getting trained to handle a crisis in an immersive
environment while trainers get real-time feedback, thus reducing perception errors in the field and
increasing preparedness level. With multi-national companies aiming to train their globalised
workforce to a common high standard, these cutting-edge training modules and tools are becoming
available worldwide. Now, a product manager in Lagos and his counterpart in Bremen will get
similar training to handle a crisis. However, are we wise in expecting them to respond to a crisis
in the same way? What are the effects of national culture on crisis management and strategy?
The Invisible Hand
Drucker answered the above questions when he said, “Culture eats strategy for breakfast”.
Although he spoke about organisational culture, the same applies to national culture as well.
Hofstede elaborated on this when he proposed the cultural-dimensional theory or the 6D model18.
He scores various cultures on power distance, individualism, masculinity, uncertainty avoidance,
long term orientation and indulgence. From 0-100, anything above 50 is considered high, and
below 50, low. A comparison of the Hofstede Index between Japan, the United States, India,
Sweden and China is given below19. These differences in culture are reflected in how their crisis
management changes.
Take the case of Japan’s Fukushima Daichi plant meltdown. The managers, the administrators and
the politicians, all scoring low on individualism and high on masculinity, found it difficult to accept
failure, and thus no one took accountability. This drastically reduced the decision velocity and
increased the severity of the crisis. Interestingly, no one was held liable by the courts, and all
managers were acquitted20. A quick comparison with how the US dealt with the Exxon Valdez
incident shows both- the greed caused by excessive individualism of Exxon’s managers, as well
as the accountability that they had to muster and pay multi-billion-dollar fines and settlements. As
remote, multi-cultural teams continue to grow, managers mustn’t be weary but understand the
invisible hand culture plays. Managers have to allocate tasks based not only on their team
members’ skills but also on their cultural traits. While it has become evident that culture plays a
major role, what about demographics? How will the Millennials and Gen Z handle a crisis? Will
they become the beacon of hope for the world, or will their purported laziness and narcissism21
bog them down as a species, is what many ponder?
Passing the Baton
2015 was somewhat a usual year. It was characterised by the regular- some disasters here, some
deaths there and odd social media challenges everywhere. However, it became the year Millennials
became the most significant contributors to the US labour force!22 This is significant because it
portends to a newer generation taking the helm in a few years. While I tried to understand how
literature views millennials, I was left confused by the numerous contradictory reports. To make
it even more interesting, IBM released a study refuting all the alterity ‘millennial experts’ had
induced and concluded that our generation has more similarity to the previous one23.
Fortunately, Drucker came to my rescue, and his thoughts on the ‘knowledge worker’24 made my
standing unambiguous on the topic. He says that knowledge workers are those who measure and
manage information and take actions based on it, and I couldn’t agree more. I have realised that as
a generation, Millennials have access to better tools, thus making their decisions data-driven. More
importantly, this access to information has culled their ignorance as they are more sensitised to the
problems outside their environment. As a millennial myself, I believe that while we didn’t have to
fight a war or raise a family at 19, but we had to enter the workforce during the worst financial
downturn, live with global temperatures at the highest and now battle an invisible enemy in the
form of the COVID pandemic. Be it new apps or volunteers or the young doctors who gave up
their lives; the pandemic showed us how millennials world over amalgamated technology and
empathy while handling a crisis. As a generation, we can juggle both data and drive while
identifying ourselves with a more extensive ecosystem and not let petty politics and alterity put
bloat on altruistic values we cherish.
Parting Thoughts
Writing this essay, I learned a little about crisis, a lot about Drucker, and perhaps a bit about myself.
Be it the perils at sea or the predicaments at land, I realise that training, communication, and culture
can make managers view crisis as opportunities. If I had to sum up my thoughts with a quote, it
would be another gem from Tolkien:
The world is indeed full of peril, and in it, there are many dark places, but
still, there is much that is fair, and though in all lands love is now mingled with
grief, it grows perhaps the greater.’
Haldir, from The Lord of the Rings, J. R. R. Tolkien
About the Author:
From learning to handle machines as a marine engineer to handling machine
learning as a product manager intern, Prabath Kuzhikkat likes to be creative while finding
simple yet scalable solutions to challenges. He is passionate about sustainability & culture.
This article is one in the “shape the debate” series relating to the 13th Global Peter Drucker Forum, under the theme “The Human Imperative” on November 10 + 17 (digital) and 18 + 19 (in person), 2021.
#DruckerForum
Notes
1. Hermann, Charles F. “Some Consequences of Crisis Which Limit the Viability of
Organizations.” Administrative Science Quarterly, vol. 8, no. 1, 1963, pp. 61–82. JSTOR,
www.jstor.org/stable/2390887. Accessed 23 Apr. 2021.
2. Walters, Timothy N. “Ongoing Crisis Communication: Planning, Managing, and
Responding, WT Coombs, Sage Publications (2007), 207 pp., paper, $45.95.” (2008): 315-316.
3. Vasconcellos, Jorge. “Decision Making in a Time of Crisis: Drucker’s
Recommendations.” 창조와 혁신 6 (2013): 13-38.
4. Balmer, John MT, and Stephen A. Greyser. “Corporate brand reputation and brand
crisis management.” Management Decision (2009).
5. Haus, Mirjam, et al. “Stress and stress management in European crisis
managers.” International Journal of Emergency Services (2016).
6. Drucker, Peter F. Management – Tasks, Responsibilities, Practices: (by) Peter F.
Durcker. New York: Harper and Row, 1974.
7. Shappell, Scott A., et al. Human error and commercial aviation accidents: A
comprehensive, fine-grained analysis using HFACS. Federal Aviation Administration
Washington DC Office of Aviation Medicine, 2006.
8. Mankins, Michael C., and Bazerman, Max H. “Fooled by Experience.” Harvard
Business Review. April 27, 2015. Accessed May 30, 2021. https://hbr.org/2015/05/fooled-by-
experience.
9. Drucker, Peter F. “Managing for Business Effectiveness.” Harvard Business Review.
October 17, 2016. Accessed May 30, 2021. https://hbr.org/1963/05/managing-for-business-
effectiveness.
10. Nichols, Chris, Hayden, Shoma and Trendler. Chris “4 Behaviors That Help Leaders
Manage a Crisis.” Harvard Business Review. April 02, 2020. Accessed May 30, 2021.
https://hbr.org/2020/04/4-behaviors-that-help-leaders-manage-a-crisis.
11. Vasconcellos, Jorge. “Decision Making in a Time of Crisis: Drucker’s
Recommendations.” 창조와 혁신 6 (2013): 13-38.
12.Network, MI News. “Maersk Triple-E Vessels: Why Size Matters?” Marine Insight,
June 30, 2017. https://www.marineinsight.com/shipping-news/size-matters/.
13. Li, Chi. “Maersk – Reinventing the Shipping Industry Using IoT and Blockchain .”
Technology and Operations Management, November 15, 2017. https://digital.hbs.edu/platform-
rctom/submission/maersk-reinventing-the-shipping-industry-using-iot-andblockchain/s.
14. DeNeve J-E, Mikhaylov S, Dawes CT, Christakis NA, Fowler JH. Born to lead? A
twin design and genetic association study of leadership role occupancy. Leaders Q.
2013;24(1):45-60.
15. “2020 Training Industry Report.” Training Magazine 57, no. 5, 2020.
16. Guthrie, Abbey, and Katie, Naymon. “US L&D Report 2019.” findcourse.com, 2019.
17 Sniezek, Janet A., et al. “Training for crisis decision-making: Psychological issues and
computer-based solutions.” Journal of Management Information Systems 18.4 (2002): 147-168.
18. Hofstede, Geert. 2011. “Dimensionalizing Cultures: The Hofstede Model in Context.”
Online Readings in Psychology and Culture 2 (1). Grand Valley State University Libraries.
doi:10.9707/2307-0919.1014.
19. “Country Comparison.” Hofstede Insights, August 12, 2020. https://www.hofstede-
insights.com/country-comparison/china,india,japan,the-usa/.
20. Dooley, Ben, Yamamitsu, Eimi, and Inoue, Makiko. Fukushima Nuclear Disaster
Trial Ends With Acquittals of 3 Executives. September 19, 2019.
https://www.nytimes.com/2019/09/19/business/japan-tepco-fukushima-nuclear-acquitted.html.
21. Twenge, Jean M. “Teaching generation me.” Teaching of Psychology 40.1 (2013):
66-69.
22. Fry, Richard. “Millennials Are Largest Generation in the U.S. Labor Force.” Pew
Research Center. Pew Research Center, July 27, 2020. https://www.pewresearch.org/fact-
tank/2018/04/11/millennials-largest-generation-us-labor-force/.
23. Baird, C. “Myths, exaggerations and uncomfortable truths.” IBM. USA: International
Business Machines Corp. Obtido em 10 (2015).
24. Drucker, Peter F. “Knowledge-worker productivity: The biggest
challenge.” California management review 41.2 (1999): 79-94