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3 Keys to Effective Early Warning Systems

Guest post by: Eric Douglas

Article Overview: The best way to avoid having to communicate under fire, of course, is to avoid the problem in the first place.

3 Keys to Effective Early Warning Systems

The best way to avoid having to communicate under fire, of course, is to avoid the problem in the first place. Detecting a major problem before it happens may be difficult, but the principles of early detection are well known to intelligence experts. It's what you do to implement early detection systems that matters. There are three key steps in the process: 1) decide what to measure, 2) build the measuring systems, and 3) establish an interdisciplinary monitoring team. 1. Decide What to Measure

You can foresee what poses a significant threat to your business, your employees, customers, and key stakeholders. things like accidents on the job, embezzlement, workplace violence, faulty products, interruptions of service, and so forth. in deciding what to watch for, don't rely on "lagging indicators" like customer surveys. Look at "leading indicators," such as what your sales people are telling you. One it solutions company has a credo of "on time, on budget, and on spec." it closely monitors how well its teams perform in each of those three areas. When a team is off track, they take action immediately.

2. Build Early Warning Systems

Once you know what to watch for, the next step is to build monitoring systems. Utility companies invest in "fault detection systems" that search for evidence of line breaks and send signals back to a dispatch office. in large banks, the accuracy of transactions is measured by sophisticated "neural networks" that search for irregularities. these artificial intelligence systems can learn as they search by identifying new patterns of normal versus abnormal behavior. they are constantly looking for new types of trouble, figuring that's where the gravest danger lies. the same is true of anti-virus detection systems. they're powered by neural networks that look for abnormal bursts of activity across the World Wide Web. When they see something, these applications can pounce very quickly.

Early warning systems have to be tailored to your particular industry and needs. A retail grocery chain checks random packages for signs of spoilage and tampering. A small business owner has her bank statements sent to her home instead of her work.

When you build early detection systems, avoid the temptation to assume that you can winnow out the improbable events and focus only on those that are likely to occur. It's always the improbable event that will trigger the biggest problem. The key is to build forums of communication that enable people to talk about potential risks and determine whether adequate systems are in place to mitigate them and detect aberrations early on.

3. Establish a Monitoring Team

Once you know what you're measuring and how to measure it, people need to monitor and discuss the information regularly. It's a good idea to pick an inter-disciplinary team drawn from various departments, including some people from the front lines. The team should be led by someone with a track record of staying cool under pressure and keeping an open mind. It should have the authority to raise red flags all the way to the CEO.

This team needs to be drilled to avoid jumping to conclusions. Under pressure, your first instinct is often dead wrong. Instincts are often too tightly wound up in past experience. For example, after the World Trade Center attack on September 11, 2001, the FBI investigated what it had known about the hijackers. Research turned up a memo written by an agent that warned of Muslim extremists going to flight school and planning to pilot jetliners into buildings. It also warned that Osama bin Laden wanted to "finish the job" of bombing the World Trade Center. But higher-ups in the FBI assumed the memo wasn't worth pursuing.

After the Challenger space shuttle blew up in January 1986, killing all seven astronauts on board, investigators went back to see what they could find. They discovered a string of internal memos warning about potential problems in the booster rocket O-rings. But management had ignored these memos. They had not deemed the evidence sufficiently convincing to justify spending hundreds of millions of dollars redesigning the booster rocket.

The bottom line is this: Any organization with a lot to lose needs to have early detection systems and prepare for various scenarios. But all that planning will be wasted unless people are trained in how to think clearly and buck the prevailing winds. For the greatest risk is the one you cannot anticipate - the one that people dismiss.

In addition to early detection systems, effective leaders also prepare their organizations for a crisis by having response modules in place. The best systems I've seen have different response modules that can be combined to deal with a specific event. Preparing different modules will give the crisis management team greater flexibility and make it easier to respond quickly. Individual response modules might include: go to back-up power, notify fire or police, quick evacuation, essential services only, lockdown the facility, and transfer to secondary location. A major fire might trigger "quick evacuation" and "notify fire and police." A different set of modules might be used to deal with a major interruption of power ("back-up power" and "essential services only"). A bomb threat might trigger "notify police," "quick evacuation," "lockdown," and "transfer to a secondary location."

You get the drift. The point is that effective leaders are prepared to communicate and lead in a time when events are unfolding at light speed.

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Article Tags: business crisis, crisis management, early warning systems, effective early warning



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