University of Miami Challenges Company May Face when Dealing with A Crisis Discussion


Discuss several challenges that a company may face when dealing with a crisis. In your opinion, are companies ready for a crisis that can occur? Provide one example of a recent crisis where an organization was ready. Provide one example of a recent crisis where an organization was not ready. When writing your discussion, sure to include examples from the assigned readings/videos (In addition, you may also include personal experiences). 
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Are Organizations Ready for Crisis?
A Managerial Scorecard
Anne H. Reilly
This exploratory study sought to develop and test a new
construct, “crisis readiness,” and to examine the relationship of organization size, prior experience with crisis,
and managers’ job level with crisis readiness. A survey
methodology was used to measure managers’ perceptions
of their organizations’ levels of readiness for crisis. In
the sample of managers surveyed, the seventy.^nine
respondents reported on average slight agreement that
their organizations were ready for crisis, although they
disagreed on average that they were well-informed about
their organizations’ crisis management repertoires. The
study found strong support for the hypothesis that increasing size is associated with increasing crisis readiness,
and partial support for the hypotheses that prior experience with crisis and higher job levels are associated with
higher crisis readiness scores. The implications of these
results are discussed, together with some suggestions for
organizations concerned with increasing their readiness
for crisis.
AS THE BUSINESS environment gets
more complex, so do the crises experienced by organizations. The examples of Tylenol, Challenger, and
Bhopal illustrate that major crises not
only affect the organization involved,
Anne H. Reilly is a doctoral candidate in
the Department of Organization Behavior,
Kellogg Graduate School of Management,
Northwestern University, and a former
commercial banker. Her primary research
interests are organizational crisis, strategy,
and change. She is presently at work on
her dissertation, which focuses on strategic
preparation for better crisis management in
the banking industry.
The author gratefully acknowledges helpful
comments by Robert Duncan, Denise Rousseau, Larry Cummings, and Robert Dewar
on an earlier version of thispaper.
but also have significant repercussions
throughout the community, the industry, and sometimes the world.
Crisis management is becoming an
increasingly important issue as managers seek ways to cope effectively
with these high-magnitude threatening events.
To date, most of the organizational
behavior research on crisis has focused
on case studies of specific crisis
events, frequently political crises (Hermann, 1972; Allison, 1971; Starbuck,
Greve & Hedberg, 1978). The study
described in this paper uses a different
unit of analysis. Instead of concentrating on particular events, this
study addresses the general issue of
crisis readiness in organizations. The
study surveys individual managers
about their perceptions of .their firms’
readiness for crises. Managers are
an important component of an organization’s readiness for crisis because managers are critical actors in
any organizational change situation
(Tushman & Romanelli, 1985; Hambrick & Mason, 1984).
This empirical study had several
goals. First, .this study proposed a
new construct, “crisis readiness,” and
conducted an initial empirical test of
the construct’s validity. The concept
of crisis readiness merits examination
because of its implications for effective
crisis management: an organization
which is ready to cope with crisis argue that an organizational crisis is for numerous reasons. First, crisis
should be better able to manage it, best viewed as a turning point (cf readiness strategies can improve the
ceteris paribus, than an organization Turner’s “precipitating event” (1976); environmental enactment process
which is not prepared. A survey in- Kanter’s “galvanizing event” (1983)). (Pfeffer & Salancik, 1978) through
strument was developed to measure
making potential crises salient to the
The definition of organizational firm (cf Kahneman, Slovic & Tversky,
perceived crisis readiness, and its
psychometric properties were assessed. crisis used here draws from Milburn, 1982). Identifying potential weak
This instrument is a useful diagnostic Schuler, and Watman’s concept of spots in the organization’s crisis mantool, enabling an organization to ex- organizational crises as “situations in agement repertoire, such as informaamine, from its managers’ perspective, which organizational survival is, and tion dissemination or media relations,
the firm’s ability to cope with tin- is perceived to be, at stake” (1983): can serve to counteract any illusion
expected threats. The instrument 1161). This definition implies ele- of invulnerability (Janis & Mann,
identifies weak spots in the firm’s ments of high magnitude, the need 1977) to crisis.
crisis management repertoire, and it for taking action, and the necessity
In addition, scholars and practican sensitize the organization’s mem- of a timely response. Specifically, the
alike have argued for the benebers to the possibility of crisis occurzational crisis as a situation which fits of rehearsing for crisis (cf Milburn
potentially threatens the existence of et al, 1983; Fink, 1986), as the miliIn addition, this study also sought the affected organization.
tary does with its war games. Kiesler
to explore the relationships between
and Sproull note that the process of
certain key organizational characterpreparing may be as important as
istics and perceived crisis readiness THE STRATEGY OF CRISIS
the content: “The plan itself may
rating. Data on these relationships READINESS
not work, but planning activities proare useful in determining what factors
Many researchers have noted that vide an opportunity for cognitive replay a part in improving an organi- an organizational crisis can serve as a hearsal of coping with high uncerzation’s readiness for crisis. Testing determinant of a firm’s strategy, forc- tainty” (1982:563). Finally, crisis
these hypotheses is also important for ing an abrupt change in a company’s readiness can serve as an important
purposes of integrating crisis readi- strategic plans and orientation (Mintz- means of building slack (Thompson,
ness into the existing organization berg and Waters’ “imposed strategy,” 1967; Pfeffer and Salancik, 1978)
theory research. Finally, this study 1985; Ouinn, 1977; Tichy, 1983). into the organizational system, slack
represents exploratory research with Van de Ven and Hudson (1985), sug- which can provide additional resources
the goal of learning more about the gest that crises may sometimes even be at a time when resource availability
domain of organizational crisis. The necessary for an organization to reach is critical. For example, if time and
data generated from this study will its action threshold for making needed managerial attention are assumed to
be useful in both theory-building and shifts in its strategic plan. As Pennings be crucial crisis management resources,
future research, as it provides some notes, “it may be a crisis situation a crisis preparation plan can serve to
insights into managers’ perceptions of that provokes a decision leading to a buffer the demands on those resources
the general organizational crisis do- change in the past strategy toward a during a crisis (Fink, 1986; Smart,
new direction in the future” (1985: Thompson, and Vertinsky, 1978).
A review of the organizational
crisis literature shows that crisis has
been defined in numerous ways, with
multiple criteria. According to Hermann’s definition (1963, 1972), a
crisis is a situation incorporating three
conditions: (1) a threat to high
priority goals; (2) a restriction in the
amount of time available for response;
and (3) a surprise to decision makers
(1972:13). The managers interviewed by Reilly (1986) suggested
that a situation represents an organizational crisis if it manifests the following five attributes: high magnitude,
requires immediate attention, an element of surprise, the need for taking
action, and is outside the organization’s control. Some researchers also
The view of organizational crisis
taken in this study adds a reciprocal
dimension to the relationship between
crisis and strategy. Not only does
crisis affect strategic outcomes, but
strategy affects crisis outcomes as
well. Like Hrebiniak and Joyce
(1985), this perspective proposes tiat
both environmental determinism (the
occurrence of threatening events) and
strategic actions (an organization’s
crisis management repertoire) must
be studied in order to fully explain
the crisis outcome. An organization
which has strategically prepared for
potential crisis should be better able
to manage the threatening situation,
ceteris paribus, than an unprepared
Strategic preparation for crisis is
critical to effective crisis management
The construct of crisis readiness is
proposed to have the six core com-
The forms and natures of possible
organizational crises are infinite, and
bounded rationahty clearly prohibits
organizations and individuals from
developing specific contingency plans
for every conceivable crisis situation.
Crisis readiness is therefore defined
broadly here as the readiness to cope
with the uncertainty and change engendered by a crisis. Crisis readiness
is an “umbrella strategy” (Mintzberg
and Waters, 1985): an umbrella of
crisis readiness general guidelines
which are appropriate for complex,
unpredictable, and uncontrollable environments (cf Mitroff, 1986).
ponents listed below. Each component
was operationalized in this study using
a separate subscale to assess managers’
perceptions of the particular dimension.
1. The organization’s ability to respond quickly to a crisis.
2. How informed the managers are
about the organization’s crisis
management repertoire.
3. Managers’ access to the organization’s crisis management plans,
resources, and tools.
4. How adequate the firm’s strategic crisis planning is.
5. The organization’s media management ability in a crisis.
6. The perceived likelihood of
crisis striking the organization.
Together, these components are predicted to denote how ready an organization is to deal with potential crises.
Organization’s Quick Response
In general, an organization unable
to respond rapidly to a potential crisis
will be less ready to manage that
crisis effectively (cf Milburn et al.,
1983; Reilly, 1986). Most crises are
characterized by a sense of urgency;
a rapid response is therefore critical
in controlling the damage or avoiding
the losses engendered by the threatening situation. Response time in crisis
may be determined by numerous organizational characteristics or procedures: e.g., its ability to make appropriate decisions quickly (cf Janis and
Mann, 1977; Kiesler & SprouU, 1982);
its flexibility (cf Harrigan, 1985); and
the level of organization members’
resistance to change (cf Staw, 1982;
Weick, 1982).
How Informed the Managers Are
If managers and other key employees know little about the resources
and tools allocated for crisis response,
they cannot be ready to deal with the
occurrence of unanticipated threats
(cf Turner, 1976). Their efforts to
respond to a crisis situation will be
short-circuited by the unavailability
of necessary information which can Organisation’s Media Management
be as basic as the home telephone Capabilities in Crisis
numbers of key managers or the
The fifth facet of crisis readiness
firm’s legal counsel. Furthermore,
in this study adds an exrestrictions in communication and internal
to the crisis manformation dissemination processes, as
well as content, can also endanger an agement repertoire. Efficient, rapid
organization’s crisis readiness (Mirvis internal operations may not be enough
and Marks, 1986; Staw, Sandelands & to ensure effective crisis management;
the organization may also have to
Dutton, 1981).
interpret a major crisis event to its
environment. According to one executive interviewed by Business Week,
Managers’ Access to Crisis
“If you aren’t geared up and ready
Management Resources
to inform the public [about the crisis],
An organization’s readiness for you will be judged guilty until proven
crisis depends as much on key per- innocent.” (12/23/85:75). Inmost
sonnel’s access to its crisis manage- cases, the interpreter of the crisis will
ment repertoire as it does on their probably be the media. Because the
level of infonnedness about that reper- potential consequences of mishandling
toire. Good decisions and knowledge the media can be so high (cf Fink,
about crisis management plans are of 1986), media management ability is
little use without effective deployment proposed as an important component
of resources (cf Smart, Thompson of crisis readiness.
& Vertinsky, 1978). Organizational
structure (such as Kanter’s integrative
versus segmentaUst organizations, Managers’ Perceived Likelihood of
1983) may determine resource access, Crisis Occurring
as may power and politics. Managers
Assumptions of rational organizamay vie for control over crisis mantional
behavior (cf Thompson, 1967)
agement resources: “emergencies are
suggest that an organization
distinguishing for the actors involved
. . . Crises are occasions for managers which perceives a high probability of
to demonstrate competence,” accord- experiencing crisis would attempt to
ing to Kiesler & Sproull (1982:562). deploy resources to prepare for such
an event, hence increasing its crisis
readiness. However, an organization
which is likely to be hit with a crisis
The Adequacy of Strategic
may not exhibit high levels of quick
Crisis Planning
response ability, informedness, access
This dimension aims to capture the to resources, media management caporganization’s overall focus on strat- abilities, and adequate crisis planning.
egically planning ahead specifically for
crisis. An organization with inadeEven if an organization believes
quate crisis planning may not be that it is subject to potential crises,
attending to tiie abrupt shifts or ac- it may not act on this attitude by
cumulating problems in its environ- preparing for them. Perhaps the orment (Turner’s “failures of foresight,” ganization has fallen prey to an “illu1976; Aldrich, 1979) which can pre- sion of invulnerability” (Janis and
cipitate a crisis. As Pfeffer and Mann, 1977) because of a sincere
Salancik (1978) note, if potential belief that the firm can handle anycrises are not salient to the organiza- thing the environment might throw at
tion’s selective perception mechanism, it. Or the organization may play
and such “environmental changes are ostrich, responding to a threatening
consistently missed, the organization environment with unconfiicted inertia
will be unprepared to face ithreats to (Janis, 1985; Janis and Mann,
survival” (1978:81). In addition, 1977) or threat-rigidity behavior
a firm with inadequate crisis planning (Straw et al., 1981). Furthermore, the
is unlikely to have specific resources perceptions of one manager may not
allocated to crisis preparation—e.g., coincide with those of the organizabackup computer systems or a public tion’s dominant coalition (Thompson,
relations department, thus lowering its 1967; Pfeffer & Salancik, 1978): alreadiness for potential crises.
though an astute individual manager
may perceive a high probability of Organization’s Size
crisis striking his organization, the
The substantial research on the rerest of the organization may assign lationship between organizational size
zero probability to the occurrence of and various organizational outcomes
provides conflicting implications reThe first five components of the garding the association between orcrisis readiness construct are all ex- gatiizational size and managers’ evalupected to be positively related to an ations of crisis readiness. Size was
orgatiization’s “crisis readiness” as operationalized in this study as a fivewell as positively related with each level continuous variable according to
other. However, because of the rea- the number of employees. The five
sons outlined above, the sixth pro- levels used were 1-25; 26-100; 101posed component — perceived likeli- 1000; 1001-10,000; and over 10,000
hood of crisis occurring — and the employees.
other five dimensions are predicted
On the one hand, some research
to be unrelated. Thus,
suggests that increasing size may be
associated with decreasing crisis readiHypothesis la:
ness. Large organizations may suffer
Managers’ perceptions of quick from cumulative control loss (Wilresponse ability, informedness, liamson, 1975), which restricts their
resource access, adequate crisis cotnmunication and itiformation displanning and media management semination ability, while resource acwin all be positively and signi- cess may become highly centralized
ficantly related with each other. and restricted in large firms (cf
Kanter, 1983). Hannan and Freeman
Hypothesis lb:
Managers’ perceptions of the (1977) argue that large organizations
likelihood of crisis occurring to are more likely than smaller ones to
their orgatiizations will not be exhibit structural inertia; hence, comrelated to the other five com- pared to small firms, big companies
could be less able to respond quickly
ponents of crisis readiness.
to a crisis situation. Big companies
in the life cycle stage of bureaucratic
THE RELATIONSHIP OF CRISIS decline may respond to potential
crises with formally rather than subREADINESS WITH OTHER
stantively rational behavior programs
(cf Dewar & Walsh, 1985). In StarThis study also sought to test some buck’s (1983, 1985) terms, they may
hypotheses concerning the relationship act as bureaucratic action generators,
between certain key organizational responding with an tmreflective, invariables and perceived crisis readi- appropriate approach to a potential
ness. Three factors were proposed crisis.
as important independent variables inIn contrast, other research on size
fluencing managers’ perceptions of
their organizations’ crisis readiness: imphes that larger orgatiizations may
(1) the orgatiization’s size; (2) the be more ready to cope with crisis than
company’s prior experience with crisis smaller firms. Because bigger organi(two organizational-level variables); zations tend to have more slack reand (3) the manager’s job level (an sources (Katz & Kahn, 1966), they
individual-level control variable). As may be more able to survive the enwill be discussed below, prior research virotmient resource scarcity engenderyields conflicting predictions concern- ed by a crisis than may a small uning the direction of these variables’ dercapitalized organization (Aldrich,
1979). Increasing size has been aseffects on crisis readiness scores.
sociated with an increasing number
An aggregate measxure of crisis of specialized functions and standardreadiness consisting of the sum of all ized procedures (cf Pugh, Hickson,
item scores on the six subscales was Child & coUeagties, 1963, 1972,
used as the dependent variable in 1974); hence, big companies are
testing this model. A low score on more likely to have specialized crisis
this aggregate measure denotes a high management teams and tools than
smaller organizations. Furthermore,
degree of perceived crisis readiness.
because of their larger resource pool
and specialized structure, bigger organizations will be more apt to have
specific boundary spatining activities
(Thompson, 1967; Pfeffer & Salanick,
1978), such as public affairs departments or economic and industry analysts on staff. This focus on the
environment could increase crisis
readiness through improving the organization’s quick response ability and
crisis preparation orientation.
Here, it is proposed that the benefits of more resources, specialized
functions, and greater environmental
scanning will outweigh the disadvantages of structural inertia and bureaucratic action generation in perceptiotis
of crisis readiness. Hence,
Hypothesis 2:
As organizational size increases,
crisis readiness scores increase.
Organisation’s Prior Experience
with Crisis
As with the research on size, the
organizational theory literature has
some contradictory implications for
the relationship between prior experience with crisis and present level of
crisis readiness. A dummy variable
was used to operationalize past history
of crisis in this study.
Some research would suggest that
past experience with crisis may yield
some organization behavior which
makes the company less ready to cope
with future crises. For example, a
prior crisis may have strengthened defensive routines (cf Argyris & Schon,
1978) or conflict, (cf Milburn et al.,
1983) within the organization, or engendered the threat-rigidity effects
noted by Staw, Sandelands, and Dutton (1981), all of which could lower
the firm’s quick response ability as
well as restrict information dissemination and resource access. Furthermore, several researchers have argued
that organizational actions are characterized by rigid tmderlying assumptions which are difficult to change (cf
Mitroff, 1984; Starbuck, 1985; Weick,
1982). Such assumptions (for example, “money spent to prepare for
something which will probably never
occur is money wasted”) may persist
despite strong historical evidence to
the contrary (e.g., poor performance
in prior crises), keeping the organization’s crisis readiness low.
However, other research provides the
opposite implications, suggesting that
organizations which have experienced
crisis in the past should exhibit
greater readiness for future crises.
Proponents of organizational learning
(cf Argyris & Schon, 1978) would
argue that an organization which has
been through a crisis should have
gained knowledge about how to respond to future crises from the crisis
experience. For example, if the firm
mismanaged its media relations during a prior crisis, the organization
would now be more knowledgeable
about dealing with the media. Vicarious learning may also occur (cf
House & Singh, in press) from the
organization’s industry competitors. If
the industry context is characterized
by recurring threats, the organization
may learn how best to cope with them
through both its own experience with
past coping behavior plus the observed
behavior of its industry competitors.
Furthermore, the sahence heuristic
(Kahneman et al., 1982) may affect
managers’ evaluations of their organizations’ crisis readiness. If the
company has had past experience with
an organizational crisis, especially recent experience (cf Hambrick, 1981),
managers at all levels may be aware
of and informed about the firm’s crisis
readiness repertoire.
The prediction made here is that
organizational leaming and salience
will outweigh threat-rigidity effects
and rigid assumptions in affecting
present crisis readiness levels. Thus,
Hypothesis 3:
An organization which has experienced a crisis in the past
will show a higher crisis readiness score than an organization
which has not experienced a
Manager’s Job Level
Given the methodology of this
study, manager’s job level was proposed as an important individual-level
control variable because of its potential inflationary impact on organizational crisis readiness ratings. Studies
by Hambrick and his colleagues (cf
Hambrick, 1981; Hambrick & Mason,
1984) of the effects of top management characteristics on organizational
outcomes have shown that job level
(along with other variables such as
age, education, and career experience) can affect an executive’s perceptions about his organization as a
whole. In this study, job level was
operationalized as a continuous variable with six levels, ranging from (1)
owner/officer to (6) line or staff employee. The same coder assigned all
job level ratings in order to assure
consistency across levels.
Seventy-nine individuals from seventy different organizations located
primarily in the Midwest voluntarily
completed the survey instrument. A
wide range of industries and occupations was represented in the sample
(Kish’s purposive sampling, 1965),
ranging from retail store manager,
newspaper editor, attorney, hotel public relations executive, banker, pharmaceutical researcher, marketing consultant, physician, academic administrator, accountant, engineer, software
sales manager, to entrepreneur. All
respondents were employed full-time;
97% were coUege graduates. Their
career backgrounds were varied. Fiftytwo percent of the sample reported
job experience in sales, marketing, or
distribution at some point during their
careers; 44% had had experience in
general management; 32% had
worked in finance or accounting; 29%
in human resources or public relations; 27% had worked in production
and operations; 20% had job experience in engineering, design, or R & D;
and 10% reported experience in legal
work. The mean tenure in their
present position was 3 years, with a
range in tenure from a few months
to ten years. The respondents ranged
in age from 24 to 75, with a mean
age of 36.
Several reasons may explain why a
higher job level may be associated
with a higher rating of crisis readiness.
First, compared to lower level managers, upper level managers tend to
have longer tenure with their firms,
and longer tenure has been related
to greater commitment (cf Salancik,
1977). Higher level executives who
are more commited to their firms may
tend to view their companies favorably across the board; this halo effect
may spill over into the crisis readiness rankings. Second, because of the
nature of their powerful positions and
their limited peer group, top executives may also be more prone than
middle or lower level managers to
the effects of illusion of control
(Langer, 1975) and group think
(Janis, 1985; Janis & Mann, 1977).
Upper level managers may thus be
more likely than lower level managers
to believe that they and their organi- Procedure
zation are ready to manage any crisis.
The survey instrument used in this
Finally, the salience heuristic (Kahne- study was a four-page questionnaire.
man et al., 1982; Kiesler & Sproull, For purposes of inducing a common
1982) may also play a part: the frame of reference, the cover letter
higher an executive is in the organi- included the following definition of
zation, the more likely s/he is to organizational crisis: “A situation may
know about and have access to any be considered a potential organizacrisis readiness resources the com- tional crisis if it represents a significant
pany has in place.
threat to the existence of the affected
organization.” In addition, three exThis study attempts to control for amples of organizational crisis were
the predicted positive relationship be- provided: Union Carbide’s industrial
tween managerial position in the disaster at Bhopal, the Tylenol tamphierarchy and the reported organiza- erings, and a hypothetical small contional crisis readiness ratings by in- struction company whose bookkeeper
cluding job level as a control variable. embezzled the company funds and
fled to South America.
Hypothesis 4:
The higher the job level, the
higher the crisis readiness score.
The first section of the survey instrument included twelve demographic
questions in three categories: organi83
zation (e.g., size, company’s experience with crisis); job (e.g., occupation, tenure in position); and individual (e.g., age, personal experience
with organizational crisis). The second
section of the survey consisted of
thirty items about organizational readiness for crisis and six items about
specific crisis management tools and
procedures. The respondents were
asked to rate their level of agreement
or disagreement with items 1 through
24 using a five-point scale anchored
by 1 = Stron^y Agree and 5 =
Strongly Disagree. The remaining
twelve items also used five-point
scales, but the anchors were specific
to the questions asked (such as very
important to very unimportant, or
very accessible to very inaccessible).
The five-point response array was
judged adequate, as only 3 respondents marked a few in-between values.
Two missing data values (“I don’t
know” and “Not relevant”) were
The crisis readiness items in the
survey instrument comprised six subscales. Each scale originally consisted of five items measuring the
respondents’ perceptions of the six
proposed dimensions of crisis readiness: quick response ability, informedness, resource access, media management ability, adequacy of crisis planning, and perceived likelihood of
crisis. One outlier item each was
eventually removed from the access,
media management, and likelihood
somewhat ill-informed about their organizations’ crisis management repertoires (mean response ^ 3.16). The
reliability indices were calculated by
SPSS-X using Cronbach’s alpha procedure (SPSS, Inc., 1986). As Table
1 shows, the reliabilities of these exploratory scales were good, particularly the scale reliabilities for crisis
planning, informedness, and quick
response ability.
ment were all positively and significantly correlated with each other,
and there was no statistically significant relationship between perceived
likelihood and the other five dimensions of crisis readiness.
Factor Analysis
One of the goals of this exploratory
research was to examine the construct
validity of the crisis readiness concept,
testing how the proposed subscales
related to each other (Ghiselli et al.,
1981). Table 2 summarizes the intercorrelations among the six proposed
dimensions of crisis readiness. The
table shows strong support for both
Hypotheses la and lb. As predicted,
quick response, informedness, access,
crisis planning, and media manage-
The survey items were factor analyzed in order to identify the common dimensions of perceived crisis
readiness underlying the measures.
The SPSS-X principal analysis procedure with a varimax rotation was
used (cf. Comrey, 1973). With 27
items, and using the “little jiffy” technique (Comrey, 1973), the factor
analysis yielded three factors. Given
that the crisis readiness construct proposed six dimensions, the principal
analysis procedure was rerun with
four, five, and six factors. But the
three-factor structure remained cleanest. These factors explained 53.2%
of the common variance in perceived
Scale Means and Cronbach’s Alpha Reliability Coefficients
No. Items
Quick Response
Access to Resources
Crisis Planning
Media Management
* On a five-point scale, with 1 = Strongly Agree
Measures and Indices
Table 1 lists the mean values for
the instrument’s six scales. As shown,
the respondents indicated strongest
agreement with the likelihood of a
crisis occurring to their respective organizations (mean response = 1.82).
The mean responses for the ability
to respond quickly, access to crisis
management resources, media management readiness, and crisis planning
scales were on the agreement side of
the scale ratings, with the mean values
relatively close to the neutral midpoint anchor. And in general, the
respondents considered themselves
Scale Intercorrelations
.41 * *
Crisis Planning
** p < .01 * p < .05 (two-tailed tests) n = 79 CoLUMBLA. JOURNAL OF WORLD BUSINESS crisis readiness. Table 3 presents the results of this factor analysis. The first factor generated explained 40.5% of the common variance. As shown, it appeared to be a general factor comprising high factor loading on all five Planning items, all five Quick Response items, all five Informed items, and all four Access items. The four Media Management items loaded together on Factor 2, while the third factor was comprised of the four Likelihood items. Regression Analysis This study also explored the relationship of crisis readiness ratings with several organizational characteristics. Table 4 summarizes the results of the multiple regression analyses. As shown. Hypothesis 2 was supported, as increasing organization size was significantly related (P < .02) to

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