Brexit, Leave, and the failure of crisis management

In the aftermath of the EU referendum vote, the Leave campaign believed that David Cameron would keep his promise and start Article 50. Article 50 is the formal notification to the EU that the UK will leave.[1] David Cameron, who had wanted to stay, had other ideas. He resigned effective October without initiating Article 50. Two immediate consequences emerged. First, no one was certain what would happen next. Second, no one expected this outcome. The result has been a confusion, uncertainty, rumour, and fear. In short, the UK now faces a crisis.

The government handles crisis, but no one is in charge?

In a normal situation, the government handles a crisis. This is the reason they are elected. The EU referendum is different. The Leave campaign, who are nominally in charge, are not in charge. There is no one in charge to initiate Article 50. At least, there is no one who has stepped up with a plan. No one to communicate the plan. No one to reassure the public about the plan. Most importantly, there is no one who has said they have decided what to do next.

Mark Carney has a plan, but some people want to get rid of him.[2]

On Friday, when the UK and world markets began to react with increasing concern, Mark Carney the Governor of the Bank of England, the UK central bank, made a statement.[3] Although he did not stop the uncertainty, he was able to calm the market because he was able to reassure it that the UK had contingency plans for financial issues. However, he has no say in the political response to the crisis. He has done his job to reassure the markets as far as he can. The politicians have to make the crisis management plans.

All crisis managers agree, you need a plan, why is Leave without one?

All crisis management experts agree that there is a basic checklist to manage any crisis.[4]

  1. Have a plan
  2. Be able to communicate the plan
  3. Implement the plan
  4. Be able to answer questions about the plan working
  5. Update the plan as needed.
  6. Be ready to adjust the plan
  7. Have someone publicly available to make decisions

In the UK, as of Sunday night, none of this had happened with the Leave campaign. They were asked earlier on Sunday if they had a plan and their response was “No. We don’t have a plan.” “We expected the government to have a plan.”

Without a plan, you plan to fail. What will leave do?

The lack of a plan will scare the market. When the markets open on Monday morning, they will expect a plan and a good one at that. Otherwise, it will react negatively. What this means is that there will be more market turmoil. In that situation, the BOE, as part its plan[5] will eventually have to raise interest rates to bring stability to the UK markets and currency. When that happens, then everyone’s mortgage immediately becomes costlier.

The UK faces a serious crisis and no one has a plan.

No one has a plan.

Why?

The same people without a plan will form the new government. Think about that. The markets will.

[1] http://jackofkent.com/2016/06/why-the-article-50-notification-is-important/

[2] http://www.dailymail.co.uk/debate/article-3659144/Carney-sacked-Lord-Farage-bye-bye-Scotland-Oh-brand-new-party-PETER-OBORNE-looks-crystal-ball-coming-months-hold.html see also http://blogs.spectator.co.uk/2016/06/bank-england-puts-boot/

[3] http://www.bbc.co.uk/news/business-36618560

[4] http://www.inc.com/bruce-condit/7-critical-steps-to-crisis-management.html

http://www.bernsteincrisismanagement.com/the-10-steps-of-crisis-communications/

https://knowhownonprofit.org/campaigns/communications/media-coverage/crisis-management

[5] https://www.theguardian.com/business/2016/jun/24/bank-of-england-mark-carney-says-brexit-contingency-plans-under-way

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About lawrence serewicz

An American living and working in the UK trying to understand the American idea and explain it to others. The views in this blog are my own for better or worse.
This entry was posted in demagogic, democracy, management, politics, reputation management and tagged , , , , , , . Bookmark the permalink.

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