September 11 is a day that has been burned into the memory of most Americans. The surprise of the attacks and the size of the devastation were more than thought possible. Businesses that had operations at the site of the attacks were faced with challenges and difficulties in maintaining their responsibility for all of their stakeholders. Brookfield Properties held several properties adjacent to the World Trade Center site. Communications were disappearing in the hours following the attack. This case reviews Brookfield Properties’ handling of the crisis and offers insight into the leadership roles that were played by key management.
As Bruce Flatt, would you go to New York or remain in Toronto? Why?
The key factor in deciding whether Flatt should go to New York or remain in Toronto hinges upon losing communications with Ric Clark. Flatt is not in communication with staff on the ground of the attacks. This creates a sense of urgency and a feeling of despair. Flatt must immediately show leadership to help stabilize the situation. The corporate structure and organization could be in limbo, and on the ground information must be obtained.
Flatt can also provide support to Clark when Clark is in touch again. It is reassuring to have the boss coming in to help, not boss. Flatt must be very careful in his approach to the crisis with the staff of the New York operations. Many of the staff members will have lost friends, family members, and loved ones in the attacks. Flatt is the one who has the authority to make things happen within the company rapidly to assist employees with needs. Clark’s position should be reinforced by Flatt. The two executives should be working side by side with Clark being the individual leading his staff.
If Clark is not found, then Flatt’s presence will help staff regain confidence. There will be no question about who is in charge of the situation. Flatt also needs to relay information about the situation to headquarters in Toronto. The staff in Toronto is sufficient to cover the vacancy Flatt will leave by heading to New York. Flatt needs to ensure that the Board of Directors is notified of his decision to head to New York
How would you prioritize the tasks that face you?
Flatt should develop a rapid plan to address the priorities and assign people as needed to the duties of the plan. The priorities should be in order of importance. This will ensure that any group will have a guide as to when something can take priority of the current task. First, life safety of all company members and tenants must be provided for. Second, the properties must be secured to prevent further danger to people. Third, the properties need to be assessed for damage and what needs to be done to make them safe for occupancy. Fourth, affected families of Brookfield Properties and its tenants need to be comforted. Fifth, other stakeholders need to be taken care of. This plan should be called an Incident Action Plan (IAP).
Flatt must assign his responsibilities for Brookfield to the next in charge in the Toronto office. This is important, because communications have not been reliable. The best choice would be Steven Douglas, Brookfield’s CFO. Douglas would have intimate knowledge of the company’s operations and needs. Many CEO’s come from CFO’s. This decision should be swift and communicated within the executive team at Brookfield and its Board of Directors.
Flatt also needs to create temporary positions that are free-floating within Brookfield to help in managing the crisis. The positions have a purpose to fulfill, and the staff member that is assigned must be given latitude in managing the task. Flatt should create positions for the following: logistics, security, public relations, a grief person, and a government liaison. This group can be called the crisis management team. They each should have access to Flatt and the autonomy to fulfill their orders without interference.
The logistics liaison should procure whatever is necessary for Brookfield to fulfill its priorities as described in the IAP. An immediate priority for logistics will be to establish communications within the company. Satellite telephones may be the best option from the onset. Logistics also needs to arrange ground transportation for Flatt to New York. Security must ensure the safety of Flatt, and they need to establish security for all of Brookfield’s interests.
The government liaison will work with all of the government agencies involved. The best choice for this position will be John Zuccotti, Deputy Chairman of Brookfield Properties. He was a prior Deputy Mayor of New York City and is well connected with various government organizations. A public relations position should be established to deal with all of the media inquiries and to manage Brookfield’s interests.
Confusion and panic rapidly spread within larger cities or potential targets. The government initiated its protocols for dealing with terrorist attacks. Individuals and families bunkered down to protect themselves from the unknown. Businesses were faced with a different situation: abandon operations, resume to normal operations, or somewhere in-between. A grief coordinator should be deployed to manage the grieving process for Brookfield’s employees, family members, tenants, and other affected persons. This person can have a positive impact during the crisis and the months after as Brookfield heals from the attacks. The goodwill earned from this person will benefit the company for decades to come. Flatt must reaffirm that Brookfield has a moral obligation to care for its stakeholders.
Flatt should have conference call updates with all of the liaisons every 6 hours during the initial hours of the crisis. Flatt’s presence in New York can have a calming affect on the company. Many leaders within Brookfield will be recognized as they are given challenging tasks and priorities in accomplishing the objectives of the Incident Action Plan. In times of crisis, man’s true metal shows through as he steps up to lead.
Who are the key stakeholders in this situation? Assess each stakeholder group’s priorities and concerns.
The stakeholders are Brookfield’s employees, tenants, employee family members, investors, and business associates. Each stakeholder must be treated with respect. They will all have different needs to be addressed and serviced. Stakeholders should be cared for using the priorities in the Incident Action Plan. Additional issues can be included if they are considered priorities as directed by Brookfield’s IAP.
Employees will need to be assured of the security of their person in the workplace. Some employees in other locations might be concerned about the future of Brookfield after the damage sustained in its New York operation. Many employees will have lost friends and loved ones in the attacks. Some will choose not to come to work and be with their families. The grief coordinator can play a pivotal role in helping employees deal with their concerns.
Tenants in the New York operations will be under new stresses and some may be able to exit their lease agreements because the property is not as originally offered. They will also be demanding increased security measures, and they will scrutinize current plans for disaster management. The security liaison may be of assistance to this group to answer their questions. He can also connect with tenants in other cities to reassure them of Brookfield’s commitment to security.
Family members of employees can be comforted through the grief coordinator. Some will be devastated by the loss of a family member that is employed by Brookfield. They are the first priority of this group to be cared for. There will also be other family members that are traumatized by the attacks. Their anxiety will only worsen unless it is dealt with. The grief coordinator can quickly deploy grief counselors to visit family members.
Investors will understand that they are not the highest priority group within Brookfield, but they will demand information and frequent updates. The public relations person can provide information as it is available to investors and bondholders. Inquiries from shareholders should be redirected to the public relations person to free Flatt of the time that would be sapped by dealing with this. Flatt must be the one to redirect big investors and bondholders. This will give the authority to the public relations person that is needed to deal with the large institutional stakeholders.
Business associates may be concerned about the stability of Brookfield after the attack. There could also be business associates that suffered severe losses. For example, a janitorial service for one of the buildings may have lost an entire company in the attacks. The grief coordinator can include this group in its pool of affected parties. Other inquiries should be redirected through the Toronto office. The Toronto office will have sufficient staff to cover the additional demands of business associates.
Brookfield must follow its priorities and objectives to ensure a cohesive balance of leadership. It would be a moral malfunction to have Flatt spending time and resources caring for a nervous stockholder when there is a grieving wife waiting to hear about her husband. That is why Flatt’s presence in New York is important for Brookfield and its stakeholders.