Cass Business School
Overview: This report investigates the origins and impact of over twenty major corporate crises of the last decade. The crises examined involved substantial, well-known organisations such as Coca-Cola, Firestone, Shell, BP, Airbus, Société Générale, Cadbury Schweppes, Northern Rock, AIG, Independent Insurance, Enron, Arthur Andersen, Railtrack, the UK Passport Agency and also some smaller firms. Several did not survive and most of the rest suffered severe damage.
Our aims were to trace the deeper causes of the crises, to assess the post-event resilience of the companies involved and to consider the implications for the risk management of companies in general.
Our report is built around eighteen detailed case studies that analyse the impact of critical events both on the enterprises most directly affected and, in many cases, on other associated firms. There are references to around forty organisations in total.
The case studies provide a rich source of lessons about risk, risk analysis and risk management, in the context of critical events of many different types, ranging from fires and explosions, product-related and supply chain crises to fraud and IT failures. Our report details over one hundred specific ‘lessons about risk’ that emerge from the case studies.Much broader lessons have also been distilled from the case studies. Several of the firms we studied were destroyed by the crises that struck them. While others survived, they often did so with their reputations in tatters and faced an uphill task in rebuilding their businesses. We found that the firms most badly affected had underlying weaknesses that made them especially prone both to crises and to the escalation of a crisis into a disaster.
