The art of breaking bad news

by Steven Crimando

Being the bearer of bad news is never pleasant. Whether it is delivering the message at work or at home, finding the right way to share bad news can be tricky. It is known that how bad news is shared can greatly affect the emotional and behavioral response of those on the receiving end. Studies around the delivery of extremely bad news, like death notifications for example, demonstrate that the way the message is delivered influences both short- and long-term reactions and recovery.

In this week’s Behavioral Risk Bulletin we would like to offer some guidance in breaking bad news. These general recommendations can be applied to situations as diverse as discussing sudden and necessary changes in college plans with a son or daughter, recalibrating retirement plans with a spouse or partner or informing employees of downsizing and layoffs. What we say and how we say it can have a significant and lasting impact on the recipient. After all, you may be delivering truly life-changing news. Doing it well is important.

The 5 T’s of Breaking Bad News

The nature of human response to a crisis or disaster is both phase-specific and hazard- specific. How we react to a threat, real or perceived, varies from hour- one to day-one to week-one and so on along the time line of the event. Likewise, how we react to a hurricane is different than a disease outbreak and different yet than an economic crisis that may too threaten our security and survival.

The 5 T’s provide a structure for developing and delivering your message. Integrating these ideas into your approach to sharing information about difficult or dangerous situations can help mitigate the adverse and unintended consequences of your task.

Take One Step at a Time

The 5 T’s approach can be useful in structuring the content and delivery of bad news. Each of the T’s is presented in a specific sequence and addressing each item in the recommended order will inform your decisions about the next.

The 5 T’s are:

1. Target
2. Timing
3. Type
4. Tone
5. Text

When delivering bad news some of us just want to get right to the point. But style is important in breaking bad news. The very last consideration should be “what” you will say. The “what” is referred to as the “text” in this model. Before racing ahead to what you will say, you are encouraged to step back and address the first four T’s.


Target refers to “who” will be receiving the news. Is it an employee, a child, a spouse or a stockholder? Obviously each audience requires a different approach. It may be necessary to adjust language to be age-appropriate for children; key stakeholders may demand technical details; employees at various levels all may require different messages delivered in different ways. In fact, with any bad news scenario, it may be necessary to develop several versions of the core message, each intended for a different target.


Timing is about “when” the news will be delivered. The time of day, week, month and year may be significant, but it may be unavoidable that the news must be shared soon, if not right away. When it is possible, consideration should be given to timing. Combining these elements, the target or “who” helps inform decisions about “when” since each audience may receive the news on a slightly different time table.


In this context, “type” means “how” or by what mechanism the bad news will be delivered. It is always preferable, but not always possible to deliver bad news in person. Telephone, e-mail and other forms of communication may be options for some but not all “targets.” Addressing the “target” and “timing” questions can help you decide the best way to share the news. The more personal the relationship, the more personal the delivery should be. With close colleagues, family and friends bad news should always be shared face-to-face. With larger and more removed audiences, other means of communication may be appropriate, but still special attention should be given to make those messages as personal as possible. No one likes to get a form letter or the feeling of being just another account number when speaking to a telephone service rep. Even in written and electronic communications, it is important to project empathy to the recipient of bad news.


Using a business-like tone at home can be perceived as cold, impersonal and distant. Being too casual or familiar with employees or stakeholders can seem unprofessional. Striking the right tone is important. One of the key concepts in determining tone is “congruence.” The tone of your message must be congruent, matching the other elements of your message in support of your delivery. In high-stress or high-fear situations, people become more reliant on non-verbal communications, therefore, para-verabal communication elements, such as tone, rate of speech and volume become increasingly important. Tone is determined by the previous T’s: who is getting the message, when they will get it and how it will be delivered. Tone must also work in concert with the “text.”


The last crucial aspect of delivering bad news is developing the actual message, referred to here as the “text.” It is important to find the right balance between language that is accurate, informative and straight forward, but not so complicated or detailed as to overwhelm or so simplified that it is condescending. If you work through the 5 T’s in sequence, the text of your message may become more apparent and natural. As with other elements discussed above, the wording of your message will require adjustment for different audiences as well.

Don’t Go It Alone

The more serious the news, the more helpful it can be to have a partner available to back you up. Mothers Against Drunk Driving (MADD) has developed structured guidelines for breaking extremely bad news, such as the death of a loved one. While most of us will never be in such a difficult and stressful position, some of the recommendations developed by MADD can be useful in delivering other less traumatic news. The National Center for Post-traumatic Stress Disorder (NCPTSD) has published these recommendations online. Having a partner along to help you deliver bad news and having expert advice such as that offered by MADD can help prepare you in the event that you must be the bearer of a tragic or powerful message.

Click here to read the MADD/NCPTSD notification guidelines.

Steven M. Crimando, MA, BCETS, is a noted author, consultant and trainer to governmental agencies, NGOs and multinational corporations. He is the Managing Director of Extreme Behavioral Risk Management (“XBRM”), a consultancy focused on the human factor in disaster recovery, business continuity and homeland security. XBRM is a division of ALLSector Technology Group, Inc., a New York based full service technology consulting company offering systems integration, managed services and applications development and implementation. ALLSector Technology Group, Inc. is a subsidiary of the F∙E∙G∙S Health and Human Services System, one of the nation’s largest and most diversified not for profit organizations.

From Bourbon Street to Wall Street: Managing the Emotional Consequences of the Financial Crisis – Lessons Learned in Natural Disasters

by Steven Crimando and Cynthia L. Simeone

Like natural disasters, a sudden financial crisis can result in uncertainty, loss, and anxiety about the future. Much of what is known about the emotional and behavioral response to other types of disasters can be helpful in managing the psychological consequences of the financial crisis. Left unchecked, these consequences can further complicate individual, community and organizational recovery. Lessons learned and strategies for coping developed in other disasters can be employed in financial crises to mitigate the emotional and behavioral consequences of the situation.

It’s a Disaster

The wave of fear and uncertainty that has rolled over Wall Street is certainly different in many ways from the wall of water that inundated Galveston in mid-September, but from a psychological standpoint, both events are disasters. Whether you are a financial services professional directly experiencing the meltdown on Wall Street, an investor feeling the ripple effects or someone otherwise distressed about the current economic climate, the shock to the nation’s financial system can trigger a powerful and overwhelming emotional response. The September 15, 2008 article, “The Emotional Impact of the Wall Street Crisis,” reports that, “employees of the financial industry’s giants are likely experiencing an emotional state that’s unusual to them – complete and utter uncertainty about their futures.”

The terms “loss”, “grief”, and even “trauma”, can be applied to communities ravaged by the recent hurricanes and the financial communities in major cities around the world. Some of the core concepts in impact and coping with natural disasters can be helpful across a range of different types of crisis situations. It has been said that grief is our response to something good going out of our lives, while trauma is our response to something bad coming into our lives. In many disasters and crisis events, both grief and trauma are present and powerful forces to be reckoned with. Unfortunately, many individuals, communities and organizations have become too familiar with, and too practiced at dealing with the emotional consequences of natural disasters. A February 2008 Oxfam International study documented a quadrupling of natural disasters over the past two decades, from approximately 120 to more than 500 worldwide each year. But the type of crisis affecting the financial industry today has been a relatively rare, but not completely unprecedented event.

With the increase in other types of disasters, there has evolved a growing body of knowledge about how sudden, shocking and threatening events affect us, along with best-practices in “psychological consequence management.” Much of what we know about the emotional response to other types of disasters can be applied to and helpful in dealing with the psychological challenges of the current financial crisis. The noted statistician, George Box was credited with saying that, “all models are wrong, but some are useful.” While there is not a one-to-one comparison to surviving a hurricane and a financial crisis, many of the front line lessons in disaster response do apply.

What is Lost?

In major disasters there are unfortunately many instances when individuals and families truly do lose everything. Losses can include loved ones, a home, pets, irreplaceable keepsakes and more, including a sense of community or safety. Deeply-held personal or religious beliefs can be shaken. In many situations and specifically in financial disasters, those loses can be somewhat imperceptible and not obvious to others. A financial crisis can result in a loss of:

•Identity and belonging


•Security, financial and otherwise

•Status and role


•Future or purpose

Grief reactions, similar to those experienced after other types of losses, such as the loss of a loved one, are not uncommon. As stated, grief is our response to something or someone good leaving our lives and mourning these losses can be tricky. Survivors (and sometimes others around them) of financial disasters often don’t compare themselves to those who have experienced natural or technological disasters. However, loss is loss, and we are finding that this is a fair and useful comparison.

Phase-specific, Hazard-specific and Individual Responses

How individuals react during a crisis varies from hour-one, to day-one, to week-one and out along the timeline of the event. To help individuals and organizations predict and prepare for the emotional fallout from a financial crisis, a basic disaster-behavior timeline can be helpful. This timeline is marked by several foreseeable phases or stages, each representing its own challenges and perhaps, opportunities.

1. Impact: The initial phase of any disaster or crisis event is characterized by disbelief, fear and uncertainty. Fear of the unknown is a universal source of anxiety and the early phase of a crisis is often filled with ambiguity and a lack of information or clarity. Early emotional reactions often appear as shock and numbness.  

2. Inventory: Once the smoke clears, people generally get a sense of how the disaster or crisis has personally affected them. It becomes increasingly clear what was damaged or lost and some of the initial shock often gives way to anger and blaming, sadness and feelings of powerlessness.

3. Disillusionment: It seems that many people slide into a period of disillusionment after a major trauma or loss, but to what degree varies with the situation and the individual involved. This phase is characterized by resentment, hopelessness, anger and sometimes shame or guilt. Often people report just feeling “stuck” and unable to make any forward progress in rebuilding their career or life. In work-related crises, this can be tied to perceptions of unfairness over pay and severance; difficulty finding a new job; and recognition of the permanence of change in lifestyle or work.

Disillusionment can also be compounded and prolonged by a cascade of secondary stressors, such as mounting financial pressures in the home or problems in relationships. This is a phase in which some people have great difficulty seeing the light at the end of the tunnel. It can seem bleak and hopeless for some and good emotional support becomes critical during this phase.

4. Reconstruction: Rebuilding a career, a lifestyle and a sense of optimism can take time, like rebuilding a home or community in the wake of a disaster. Everyone moves through these phases in their own time and on their own terms. There is no best way or specific timeframe in which people move through these phases. Moving through the phases and reconstructing a professional and/or personal life is very individualized. For some the process can be weeks or months long, for others it may take years. Establishing a “new normal” requires patience and persistence from everyone involved.

5. Integration: For the survivors of any crisis, the process of integration involves weaving the crisis into one’s overall life story. We never forget the crisis or disaster, but it becomes an important milestone or even a battle scar, rather than an obstacle or preoccupation that dominates our daily lives. In summary, it becomes a story, rather than the story, in our personal history.

And then there are specific personality traits, cultural influences and community norms (such as within the organizational culture, the community of financial professionals, etc.) that all come into play. Simultaneously, there are somewhat predictable responses to a financial crisis and totally unique responses that are not necessarily foreseeable or expected.

Exposure and Duration

In response to any real or perceived threat to our safety, survival or way of life, the degree of exposure and the duration of the threat are critical influences. Exposure can be thought of in degrees, first, second and third, much like a burn.

First degree exposure is experienced by those directly impacted by the event, in this instance, those executives, brokers and traders employed in the financial industry. The radical and sudden restructuring of the financial services environment has pulled the rug out from under tens of thousands of employees who face the loss of their livelihoods and stock value. Of course, the spouses, partners and children of those financial professionals are also directly affected as household incomes drop and economic security of the family becomes the dominant theme in everyday life.

Those who are not employed in the financial sector, but may experience significant losses in investments or are dependent on the financial industry for their incomes, would be considered secondary victims or having second degree exposure to the situation. With countless jobs evaporating in New York, London and elsewhere, the restaurants, retail establishments and service industry catering to the financial districts will also suffer substantial and perhaps irreversible losses. Many small businesses will also cease to exist with the sudden exodus of so many jobs.

As the ripple effect of the crisis widens and moves out from its epicenter, the circles become larger. Third degree exposure potentially applies to the wider U.S. and international community already anxious about instability in housing, credit, commodities and energy. This is the “Main Street to Wall Street” connection the current U.S. presidential candidates frequently reference. Many people will not personally know of someone working in the financial sector or in a business serving the financial community, but they are concerned and vigilant on a day-to-day basis about the price of gas, milk, heating oil and housing. For those with third degree exposure, the vulnerability of financial giants, such as Lehman Brothers, Merrill Lynch and AIG can heighten a sense of personal vulnerability, “If firms with literally billions of dollars in assets can’t make it, how can we?”


Obviously, how the crisis affects any one individual, family or organization is a function of their relationship, proximity and exposure to the event or situation. The closer you are to the fire, the greater the potential injury. Likewise, the longer the threat exists, the greater the impact. In many instances, natural disasters are sudden and devastating, but the initial event can end as quickly as it began. Tornados are devastating, but fast moving. Certainly it can take months, years or a lifetime to rebuild after a tornado strikes a community, but the initial threat passes quickly.

Typically, the longer a threat persists, the more damaging it is from a psychological and social standpoint. The financial crisis is in some ways both acute and chronic. The news of the Lehman Brothers collapse and sale of Merrill Lynch may have been sudden and unexpected by some, especially with the news of what is being referred to as “Bloody Sunday” being sprung on a weekend when the public’s attention is not usually on the markets.

But at the same time that the news was sudden and dramatic, many of the current economic problems that caught up with Lehman and Merrill Lynch have been creating instability in the markets for some time. Chronic stressors tend to exhaust us, some believe leaving us more vulnerable to additional risks. We seem to be much better suited to manage sudden, but short-term crises. But when a crisis is both sudden, shocking and prolonged, it can result in more complex and challenging emotional reactions. Every disaster is unique and at the same time, may have many similarities to other disasters. The current situation is unlike anything we have ever seen and yet bears a strong resemblance to many previous financial crises.

Reactions Vary

For several reasons, individuals experiencing distress related to the financial crisis may not reach out for help in meeting the emotional challenges. Not wanting to appear weak or worried in front of family members or colleagues; intolerance of our own fear or anxiety; and the need to appear in control, can all become barriers to seeking assistance or admitting that the situation is taking an emotional toll. It is useful to note that even following natural catastrophes, most people don’t go running for psychological support. There is typically a delay in seeking assistance, at least through the impact and often into the inventory phase. Most people facing a financial disaster, including layoffs or the disappearance of an entire industry similar to what may be experienced in large-scale natural disasters, don’t go on to become psychologically-damaged goods. Most people experience some degree of emotional distress, considered natural, expected and even helpful in surviving the challenges they face.

Across different types of disasters and crisis events, it is common for those individuals directly affected, as well as those in their immediate circles, to experience a range of reactions. And while these are natural and normal responses, they can certainly be unpleasant and add to one’s overall discomfort. Such reactions include physical, emotional, cognitive and behavioral changes that in some instances can complicate the situation and become barriers to coping with the challenges ahead.

Physical Reactions

– Shock-like reactions
– Insomnia
– Loss of appetite
– Headaches
– Fatigue
– Elevated blood pressure and heart rate

Emotional Reactions

– Depression, anxiety
– Numbness
– Constricted range of emotions
– Guilt, shame, doubt
– Intolerance of emotional response
– Global pessimism

Cognitive Reactions

– Distractibility
– Memory problems
– Decreased problem-solving ability
– Declining work performance
– Recurrent intrusive thoughts
– Nightmares


– Thrill-seeking, risk-taking
– Preoccupation with related news stories, rumors, etc.
– Increased substance abuse
– Jumpiness, feeling “wired”


– Clinging, isolating
– Irritable, argumentative
– Distant, detached
– Increased/decreased need for physical intimacy
– Wanting to be only with co-workers/avoiding contact with co-workers

While these reactions are widely seen in response to natural and technological disasters, they are common in other interpersonal crises where there is an element of threat. Threat to one’s survival due to a financial crisis is no different. Most of these reactions are short‐lived and self‐resolved as the individual moves along the timeline of the event. For some, these reactions can be more pronounced and prolonged. There may even be instances in which, in a more extreme form, one or more of these reactions may represent the symptoms of a medical or psychological emergency.

Chest pains, arrhythmias or heart palpitations, as well as respiratory distress and acute abdominal pains may be the signs of something more serious and require medical attention. While potentially stress‐related, these reactions should not be ignored or thought to be “just in your head.” Likewise, suicidal and/or homicidal thinking, as well as serious mental disorganization or disorientation may the signs of psychological emergencies and should be assessed by medical or mental health professionals.

Emotional Consequence Management

The concept of “consequence management” is widely accepted by business continuity professionals across most industries (e.g. risk mitigation and planning impacts risk consequence). Managing the emotional and psychological consequences of any disaster, natural, technological or economic, is critical to the recovery of the individual and their family, as well as the community and organization. The psychological impact of the current financial crisis should not be ignored or minimized. For many people this crisis represents substantial losses and a threat to personal and professional survival. This should not be underestimated in any way.

During a time of increased personal and professional demand, the impact of sleep problems, poor concentration, depression, apathy and increased use of alcohol and other substances can become serious obstacles to problem-solving and decision-making. Problems in personal relationships can create tension and distance from those who might be most helpful and supportive. The emotional consequences can be significant and difficult to address if not taken seriously and proactively.

There are coping strategies and techniques that can be helpful for individuals and families, as well as organizations. Many of these are similar to those being used today to assist the survivors of the recent spate of tropical storms and hurricanes.

Here are some useful suggestions for coping with the stress and anxiety stemming from the financial crisis:

– Limit your exposure to news stories and constant alerts about the situation
– Get accurate, timely information from credible sources; avoid rumors if possible
– Try to maintain a routine, even if you must create a new one
– Exercise, eat well and rest, even though it may be difficult to sleep
– Stay busy – physically and mentally

– Communicate with friends, family and supporters; let people know how they can help
– Use spirituality and your personal beliefs
– Keep a sense of humor
– Take one day at a time

Do Something

The great risk communications expert, Peter Sandman advises that, “Action binds anxiety.” Doing something is almost always more psychologically helpful than doing nothing. Past financial crises have demonstrated that investors tend not to fight or flee but rather to freeze. In natural disasters, there can be irrational fighting and fleeing, but in most instances people find purposeful “next steps” that actually make the situation better. Individuals and organizations would do well to heed Dr. Sandman’s advice. Getting people active in support groups and social networks, as well as practical hands-on activities is important. We know that people who actively participate in rescue and recovery tasks during disasters fare much better, physically and mentally, than those who withdraw, become passive or apathetic. Keeping busy, focused and productive during stressful times is essential to counteracting feelings of helpless and fear.

Use Available Resources

Many firms offer Employee Assistance Programs (EAPs) or Wellness programs that include stress management and support services. Such programs often extend their services via hotlines as well and many of these employee support call centers have already begun to experience noticeable increases in utilization. But many affected by the financial crisis, such as those with second and third degree exposure, do not necessarily have access to such resources. There are non-profit organizations, such as those affiliated with the National Mental Health Association, that provide no-fee helpline support, often 24 hours a day, as well as referrals to support groups and mental health professionals with expertise and experience in dealing with acute stress reactions. These resources are made available to communities struggling with the emotional impact of natural disasters and violence and they can be useful in a financial crisis as well. If reaching out to an EAP or Wellness Program is not an option, you can locate a nearby affiliate of the National Mental Health Association online or contact them by phone at (800) 969-6642.

No One is Untouched

Deborah DeWolfe, Ph.D., author of one of the first field guides developed for disaster mental health response stated, “No one who experiences a disaster is untouched by the event.” This is not to say that everyone is traumatized or damaged in some way, but a sudden, shocking and threatening event takes its toll. It is estimated that almost 9,000 employees lost their jobs in the Bear Stearns restructuring. Ultimately, job losses may be in the tens of thousands across the financial industry and countless more in service jobs that rely on financial sector workers as customers in the restaurants, bars and boutiques in and around the financial districts. A storm, earthquake or act of mass violence resulting in tens of thousands of lost jobs would certainly be called a disaster. Make no mistake, the life-changing events of the past several weeks in the global financial system are also a disaster and no one is left untouched.


Steven M. Crimando, MA, BCETS, is a noted author, consultant and trainer to governmental agencies, NGOs and multinational corporations. He is the Managing Director of Extreme Behavioral Risk Management (“XBRM”), a consultancy focused on the human factor in disaster recovery, business continuity and homeland security. XBRM is a division of ALLSector Technology Group, Inc., a New York based full service technology consulting company offering systems integration, managed services and applications development and implementation. ALLSector Technology Group, Inc. is a subsidiary of the F∙E∙G∙S Health and Human Services System, one of the nation’s largest and most diversified not for profit organizations.

Cynthia L. Simeone, PMP, CBCP, is a New York City-based consultant, specializing in business continuity and organizational effectiveness helping clients understand and navigate the complex environments, relationships, and controls that their businesses must master to survive and thrive.

Fear, performance and productivity

by Steven Crimando

Basic Concepts

In 1908, psychologists Robert Yerkes and J.D. Dodson developed a model of understanding the affects of fear and stress on performance. The “Yerkes-Dodson Law” dictates that to a degree fear and stress can motivate and drive performance, but that a tipping point is reached where performance greatly diminishes. This concept is widely used in sports psychology to help elite athletes find and stay in their “zone” of peak performance. Most of us have experienced this on some level and have a sense of where our own point of diminishing returns is set.

A far more eloquent and useful model to help us understand the type of fear generated by the current financial crisis is “crisis decision theory.” Crisis decision theory helps us predict the responses people will choose to negative circumstances. Since a negative life event is largely subjective and shaped by our individual perception, crisis theory can be applied to a wide range of adverse events, from losing your wallet to losing your home. Crisis theory sets out to address two questions that may be helpful in anticipating the emotional and behavioral responses to the current crisis:

*What are the decision processes people use when faced with a negative event
*What are the factors that predict their response choices

Although the current discussion is limited to the financial crisis, crisis decision theory can also be applied to disaster scenarios, such as the factors involved in choices about evacuation, personal and family disaster preparedness and reporting to or remaining at work during a crisis or disaster. Business continuity planners and emergency management professionals should consider incorporating some of the important concepts of crisis decision theory into their response and recovery models.

Crisis Decision Theory

Let’s explore a few of the central concepts in crisis decision theory. There are three stages of crisis decision-making delineated in crisis decision theory. These include:

1.Assessing the severity of a negative event
2.Determining response options
3.Evaluating response options

Applied to the financial crisis, individuals, families and businesses are still trying to assess the impact of recent events. One individual may know with certainty that they have lost their job, another may be sure that they have suffered serious financial loses in their investment portfolio, college savings plan or retirement account, but as the market undulates from 700 points up to 700 points down in a single day, they maybe unclear about how much of a loss the have truly suffered. For the small- or medium-size business owner, having their line of credit curtailed may mean trouble meeting this week’s payroll and perhaps losing employee confidence or perhaps losing the employee who can not afford to come to work if pay day is not a sure thing. This phase of a crisis event can be chaotic and ambiguous, so as straight forward as this initial stage of crisis decision theory may seem, assessment often can not begin until the smoke clears.


Since there are so many unknowns in the current financial environment, employers should enhance efforts to communicate with key stakeholders, including employees, about the company’s financial position and provide reasonable warning if any difficulty is foreseen. Transparency about such issues can improve employee loyalty and mitigate rumors that can impact safety and performance.


From a crisis decision theory perspective, the financial crisis holds some unique challenges, specifically that when a threat (physical, emotional, financial or otherwise) is so extreme, it may overwhelm people and paralyze their progress though later stages. The authors of crisis decision theory (primarily Kate Sweeney at the University of Florida), depict this potential in an inverted “U.” If a crisis is not sufficiently scary, people may not be motivated to act in any way, and conversely, if the situation is extremely frightening, it can immobilize people and impede any meaningful action.

There are several other factors that help shape people’s perception about how bad a crisis really is. These include:

* Cause: Who’s to blame? If people see themselves to blame (“I should have…before this happened” or “If only I had…”) they tend to perceive the crisis as more severe.
* Comparisons: With their idea of how things should be; how they used to be; how the crisis affects others around them.
* Consequences: Their fears of negative consequences yet to come.
* Public Image: Events that damage a person’s image in their company, their social circles or neighborhoods, are also experienced as more severe.

There will be great variation in how individuals respond to the financial crisis. Although it may appear that two employees have sustained similar loses, their reactiona may be very different. Reaction to loss is influenced by dozens of factors, including temperament and culture.


Weighing Response Options

After sizing up the problem, the next question is usually, “What can I do about it?” The two critical determinants in choosing a response option are the individual’s perception of control over the crisis and the resources available to them to tackle the problem. Someone faced with a diagnosis of cancer may be presented a whole range of treatment options from doing nothing to a radical or high-tech treatment. If this person does not have sufficient financial resources and/or insurances, many, if not all of the options may be off the table. Another person may have great financial resources, but the nature of their illness is such that there are no viable treatments, perhaps in a late stage of a disease. All of the money in the world would not be helpful in such a bind. So, options and resources are closely linked.

This all boils down to controllability. People are more successful in dealing with crises that they feel they have some control over and when they believe they have the necessary resources. Unfortunately, in the case of the financial crisis, the activity of the markets and world governments is well outside most people’s control and the loses experienced in the market melt-down can reduce the resources people might otherwise use to deal with a challenge.

Making a Choice

In a disaster planning scenario, employers may ask what factors help determine if workers will stay at their posts or come in to work during a crisis; who will perform the best and what can we do to encourage people to stick to the roles and responsibilities assigned to them in the organization’s disaster plan? Crisis decision theory helps clarify how people weigh the pros and cons of their potential response. This theory suggests that three broad considerations are involved such decisions. They are:

1. The resources (money, time, physical effort, etc.) required;
2. The direct consequences of a response (i.e.-“I might get hurt trying to get to work.” or “I might get fired if I don’t go in.”)
3. The indirect consequences of a response (i.e.-“My family will be upset if I leave them for work during a storm.” or “My co-workers will never look at me the same if I don’t show up and pitch in.”


Crisis decision theory is one of the models that helps us predict how people will behave in disasters, emergencies and other crisis events. Such a theory can also help us improve how people respond, therefore improving safety, performance and continuity of operations. In our recent white paper, “From Bourbon Street to Wall Street,” we apply disaster psychology principles to help us understand the human factor in this unpredictable climate. As we move forward through the financial crisis, XBRM will continue to offer insight and guidance in predicting and preparing for the emotional and behavioral challenges to come.

Steven M. Crimando, MA, BCETS, is a noted author, consultant and trainer to governmental agencies, NGOs and multinational corporations. He is the Managing Director of Extreme Behavioral Risk Management (“XBRM”), a consultancy focused on the human factor in disaster recovery, business continuity and homeland security. XBRM is a division of ALLSector Technology Group, Inc., a New York based full service technology consulting company offering systems integration, managed services and applications development and implementation. ALLSector Technology Group, Inc. is a subsidiary of the F∙E∙G∙S Health and Human Services System, one of the nation’s largest and most diversified not for profit organizations.