Don't talk about "preventing recurrence" right after a crisis hits!

This marks the ninth installment in this series. Anticipate potential future crises, implement countermeasures to avert them, and elevate overall capabilities through leadership. Should a crisis still occur, strive to mitigate its impact.

So, what comes next?

Yes. We must consider how to prevent it from ever happening again. This time, the theme is "Recurrence Prevention Capability." Our institute defines it as "the organizational capacity to confront the experience of a crisis occurrence and achieve more effective crisis management and the restoration of social trust."

To prevent recurrence, the first step is crucial: "fact-finding and root cause analysis."

"Preventing recurrence" is a phrase speakers often emphasize toward the end of apology press conferences. "We will thoroughly investigate the causes and strive to prevent recurrence." The determination expressed with a pained expression likely comes from genuine sincerity.

But I feel uneasy about this phrase being used in apology press conferences. "It just happened!"

Corporate scandals (crises) requiring apologies at press conferences often occur when the incident is fresh and the root cause isn't fully understood yet. Can companies really prepare recurrence prevention measures in such an unexpected, potentially existential crisis? Moreover, are the countermeasures they come up with at that point truly effective?

Last year saw a noticeable pattern: an apology press conference would happen, then something else would be discovered, leading to another apology. It might be an exaggeration, but I think the problem lay in the attitude of casually mentioning recurrence prevention measures during the press conference itself.

At an apology press conference, the company's top executives and those in positions of responsibility come forward and bow their heads. The statement made there, "We will work to prevent recurrence," also reaches the people within the company. At this point, I believe the internal mindset shifts from "clarifying the facts, investigating the cause" to "preventing recurrence." It wouldn't be surprising if a mindset like "We can't let any more flaws be found in our company" starts to take hold.

For "preventing recurrence," thoroughly "clarifying the facts and identifying the cause" is paramount. If you fail in your personal life, don't you first consider why it happened? When you oversleep or upset a friend, you reflect—"I drank too much yesterday," "Maybe I was too harsh"—and resolve to be more careful next time. Corporate crises are no different. That's precisely why we shouldn't casually jump to using the phrase "prevent recurrence." To implement effective recurrence prevention, a thorough investigation into the root cause is essential.

The trump card for "recurrence prevention measures" is "establishing a third-party committee."

Recently, more companies are entrusting third parties with uncovering facts and root causes. For companies facing scandals, establishing a third-party committee is the trump card for recurrence prevention. By prominently featuring the independent image of "third parties," it ensures the investigation's credibility and projects a path toward a more appropriate fresh start.

Cases of establishing third-party committees are increasing year by year. Recently, the activities of the "Third-Party Committee Report Rating Committee," composed of lawyers, researchers, and journalists, have also drawn attention. Many reports from third-party committees can be viewed on their websites. I believe the reliability of the investigation is ensured precisely because the "third party" itself is subject to stricter scrutiny—whether the selection of members is appropriate, whether the target company has imposed restrictions on the investigation, whether the investigation is conducted without hesitation, and so on.

 

 

In our institute's Crisis Management Capability Survey (conducted in March 2015), one question measuring "Recurrence Prevention Capability" asked whether companies "have revised their crisis management manuals or guidelines based on past 'crises' experienced by their own company." While nearly half of respondents reported implementing this measure—which experts also consider crucial—only 13% stated they "solicit opinions from key external stakeholders and experts regarding past crises within their company to aid in recurrence prevention and improvement." It is somewhat regrettable that while an "outside perspective" is sought during crises, this perspective is not leveraged for recurrence prevention and improvement.

What's needed to prevent recurrence is boosting employee morale

Corporate scandals (crises) covered by mass media reach their peak during apology press conferences. Afterwards, how the company implements recurrence prevention measures and works to restore trust? Few such cases receive similar media coverage. Yet, the public doesn't easily forget. Repeat offenses invite further criticism. The company remains under constant societal scrutiny.

However, when speaking with those from companies that have caused scandals, they sometimes reveal painful feelings like, "Did we really do something that bad?" or "It's sad to be seen like criminals." For employees who were completely unaware, it might feel like all their past efforts have been negated. Even when told to prevent recurrence, many may not know what to do and feel bewildered by being in a position to face criticism.

There's one more crucial element for preventing recurrence that must not be forgotten: boosting employee morale. Investigate the root cause and share the facts company-wide. If necessary, those involved must apologize internally. Share each other's feelings and share responsibility. From there, each person must think about what needs to be done to ensure it never happens again. That, I believe, is what truly leads to preventing recurrence.