Hurricanes, Tech Meltdowns, Pandemics… So What’s Next?
I was at the Travel + Leisure World’s Best Summit in New York last month when Neil Jacobs, CEO of Six Senses, said something off the cuff that stuck with me.
Jacqui Gifford, the magazine’s Editor in Chief, was moderating a panel on sustainability and asked the participants what keeps them up at night. Neil replied with a comment about the fragility of our industry, mentioning the cascade of challenges we’ve faced recently: COVID, wars, severe weather, wildfires… and whatever else might be lurking around the corner.
Just two days after he spoke, the CrowdStrike outage caused a massive global tech breakdown that impacted airlines, banks, hospitals, retailers, and many more businesses. Thousands of flights were canceled; Delta Airlines in particular took weeks to return to its normal schedule. All because a cybersecurity firm rolled out a glitchy software update.
The outage cost Delta a reported $500 million. That the airline, which deals regularly with severe weather, civil unrest, labor actions, and other disruptions, was caught so unawares is a wakeup call for all of us to be better prepared for the unexpected.
Every day seems to bring another unique challenge, whether it’s sabotage of the French rail network, an earlier-than-expected hurricane, a door falling off an airplane mid-flight — in addition to the cyber attacks, geopolitical conflicts, disease outbreaks, and natural disasters we’ve all already coped with. These crises are constantly poking at our vulnerabilities and reminding us to keep a running tab of potential risks to our operations.
Often, the unanticipated challenges have even less anticipated secondary effects. COVID was startling on its own; even more surprising were the disruptions to the global supply chain and the impacts on hiring from work-from-home and the “Great Resignation.”
As one of the world’s largest industries, and arguably its most interconnected, travel and tourism is uniquely susceptible to major disruptions. And there’s no end in sight. “There are more threats, they’re coming faster, and they're more complex,” says Eric McNulty, Associate Director of the National Preparedness Leadership Initiative at Harvard. I first met Eric at a talk he gave at the Virtuoso Symposium following the 2015 terrorist attacks in Paris. He advises expecting the unexpected, but cautions against nearsightedness in preparing for it. “It’s incumbent on the travel business to think, We can't always prevent that first impact, but how do we prevent the second crisis of a fumbled response?” (Delta is the most recent example of this.)
The answer is to have a system in place to deal with the next unanticipated crisis. Large organizations have dedicated crisis management and business continuity teams, but even small businesses should be constantly running through potential scenarios. “Grab your favorite online news source, look at what's happening in the world, and then have a quick internal conversation about what we would do if this happened to us,” McNulty advises. Even if you don’t know what the next crisis may look like, you can establish guardrails for your frontline staff — how they should speak to clients, what your processes and policies are, and so forth.
A crisis can also be an inflection point for a company’s culture. “The best leaders I’ve seen in a crisis are the ones that see it as a culture-defining opportunity for the organization,” says McNulty. “Even when things are at their worst, it’s your opportunity to be at your best. Those stories will live on long after the event is over.”
The idea that culture can be a bulwark against unforeseen challenges resonates with Neil Jacobs as well. When I caught up with him a few weeks after the T+L Summit, he recalled being at the Six Senses property in Israel on the day Russia invaded Ukraine. With about 60% of the hotel staff either Russian or Ukrainian, he saw the potential for distress and even conflict. He immediately convened a meeting and told the team, “I don't know what to say, other than my heart is with you all, you're all family, and we're going to look after you.” He said the meeting helped defuse the situation.
“Culture is the glue that holds it all together,” Neil says. “People are better able to sustain some of these horrible things that are happening if they feel that they are part of something that’s beyond just a job.” He also recalled the 2004 Indian Ocean tsunami, which directly hit the Four Seasons resort in the Maldives while he was the brand’s Regional Vice President for Southeast Asia. “The guests had to stay in the employee accommodations, but they were amazing: They went into the kitchens to help cook. Across cultures and economic situations, people really came together as one.” (Miraculously, the resort didn’t lose anyone that day).
That is why Neil thinks practicing empathy in an authentic way is part of how business leaders can be prepared: “It can’t be contrived for any purpose other than the fact that you care about your employees. It’s about demonstrating your humanity.”
Here are a few tips from Eric McNulty on preparing for the next crisis:
First and foremost: Don’t panic. “Unless the fire is at the front door, you've got time to take a few deep breaths and figure out what you want to do. If you're calm, those who are watching you will be calmer, and the people who watch them will be calmer, too.”
Have a crisis management team in place. But just as important is knowing how you’ll reallocate the work those team members are normally responsible for. “Small and medium-sized businesses especially can get caught short because everyone is now trying to do two jobs at once.”
Run through a lot of scenarios. Even if the bad news is happening to someone else, it’s important to think about what would happen if it happened to you. Even if the CrowdStrike meltdown didn’t impact you, you should be looking at your systems and where they might be vulnerable.
Plan out your first couple of steps. You might not be able to predict how a crisis will unfold, but you should at least know what your first few moves will look like. Who are the experts you could call? Are there alternate suppliers? Industry associations that can step in? Could a competitor help? “If you have steps 1 through 3 figured out, that buys you time to figure out steps 4 through 10.”
What about you? Does your business have a robust scenario planning and risk management structure in place? What lessons have you learned from past crises? What keeps you up at night? Let’s keep the conversation going!