One of my favorite episodes of the original Star Trek is The Trouble with Tribbles.  There are Klingons, grain to be guarded and government bureaucrats which get all the attention but in the end it is tribbles which created the crisis.  It’s a great example of the frogs type of crisis as we discussed here.

But how do you distinguish between problems and crises?  Problems are simply situations that demand an answer and involve only a few people at most.  A crisis involves a lot of people and is very serious – even life or death serious.  How do you tell them apart – because most cries look like problems when they first start as I discussed here.

Here are five questions to ask yourself whenever you are faced with a situation that might be a crisis:

  • Could this negatively impact our reputation?

Every business has one thing that is priceless – their reputation.  Tank that and it doesn’t matter what you have in inventory, your customer service reps, policies or cash in the bank.  This is a great time to practice the Washington Post Test.

  • Could this negatively impact our profits/cash flow?

If you’re not making money, then you have a hobby.  A hobby is something that you do for enjoyment – what other people think about it doesn’t matter.  But a business is something that has to have more money coming in than going out – that’s rule #1.  Rule #2 is just as important – there has to be cash in the bank to pay the bills when they are due.  A problem may momentarily affect profits or cash flow but a crisis affects them long term.

  • Could this negatively impact our important relationships?

No man is an island is more than a beginning of a poem – it’s a truism about every business.  You depend on suppliers, your bank, particular clients and especially employees.  Will the situation affect them beyond the moment?  If so, then you are dealing with a crisis.  Check out our post on cracked eggs.

  • Could this negatively impact morale?

Attitude is important – and it doesn’t change just because you say it should.  We’re not talking just about your employees – your attitude is important as well.  More than one business has taken a serious hit because the owner got down in the dumps – we had one client that went into a three-year funk because their spouse died – the business managed to limp along but the damage had been done – revenue decreased, customers lost, momentum dissipated.

  • Is there a high risk that this will go viral? 

In this age of social media and instantaneous communications, it becomes easy to let the world know what’s happening in your business as it happens – and you have no control over it!  Learn the lesson that United Airlines (United Breaks Guitars) and Burger King (Police Officer Finds Spit in Fast Food Burger) haven’t – EVERYTHING will come out – and likely at the worst moment.

In the end, it’s the way you response that will decide if you are dealing with a problem or a crisis. The first step makes all the difference as Meredith described here.

A physicist by trade, author by choice, a born teacher, a retired veteran, and an adamant problem solver, Frank has helped the White House, federal agencies, military offices, historical museums, manufacturers, and over 250 technology startups get stuff done, communicate effectively, and find practical solutions that work for them. In his spare time, he makes sawdust and watches Godzilla movies.