The Harvard Business Review had an interesting article on Facing Ambiguous Threats in its November 2006 issue. Due to our recent research on reputation recovery, I am particularly interested in identifying threats before they overturn reputations. Many companies experience early warning signs or pre-cautionary signals before threats appear and crisis takes its toll.

The article describes how hospitals will issue a “code blue” alert that calls a rapid-response team into action to aid patients undergoing cardiac arrest. Patients apparently exhibit early signs of distress such as respiratory rate changes and deviations in their appearance prior to the need for a full-fledged code blue alert. Hospitals are now codifying these patient early warning signs for nurses and other staff members in order to help staff identify them before it is too late.

Reputations can also be salvaged by paying more attention to early warning signs that precede crises. When former IBM CEO Lou Gerstner arrived at the troubled computer giant, he noticed that there were 339 satisfaction surveys, 128 different CIOs and 142 different financial systems. He warned others to take note of corporate bloat as a sign of impending deterioration.

Every company has early warning signs of danger. If we could only identify them, we’d hopefully safeguard more reputations from deterioration.

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