More recently, the Diamond Princess cruise ship was quarantined with more than 700 passengers testing positive for COVID-19. Captain Gennaro Arma was credited for preventing panic with his calm and reassuring leadership style. There are many examples of extraordinary leaders rising to the occasion in crisis situations. Because many organizations are currently facing the crisis caused by COVID-19, we thought it would be a good time to review what we know about organizational crisis and what makes a leader most effective during such times.

Crisis Is Common

Every organisation will face a crisis at some point. While the COVID-19 crisis is unprecedented, operating in a VUCA (volatile, uncertain, complex, ambiguous) world has long meant that crisis is inevitable. Whether an organisation succeeds through a crisis is dependent upon its leader’s actions. In fact, a leader’s legacy is often determined by how he or she handles a major crisis. Effective leaders must make good decisions quickly, often based on limited information. Effective leaders must serve as a rallying force that keeps employees on track. Organisations with the best leaders are the ones that come out on top when the crisis subsides.

The question then is this: What personality characteristics are most critical for leading through a crisis?

Leading Through a Crisis

Of course, you can ask anyone on the street what it takes to lead through a crisis, and they will give you an answer. So why should you listen to us? The difference between us and everyone else is that we have been systematically studying personality and leadership effectiveness for more than 30 years. What does that research tell us?

First, our research shows that an effective leader in a crisis acts like Tammie Jo Shults: She remains calm, takes charge, and confidently makes critical decisions. The two personality traits associated with acting this way are adjustment and ambition. In a crisis, people look to their leader for guidance on how to respond. If the leader is calm and sets a path forward, people will remain calm and order will be maintained. If the leader is panicked and lacks confidence about the actions to take, people will start to panic and chaos will ensue. Well-adjusted and ambitious leaders quickly adapt to unexpected changes caused by the crisis, such as the sudden shift to remote work many are experiencing, and they communicate with people about how to proceed.

Second, every crisis comes with increased stress. Even if the leader doesn’t display it externally, he or she is feeling the pressure. Our research shows that when people are under stress, they can lose their normal mode of operating and begin to derail. When faced with a crisis, people derail in three major ways: (1) moving away — by running from the problem, (2) moving against — by combating those thought to cause the problem, and (3) moving toward — by getting as close to the problem as possible and trying to micromanage it away. None of these are very effective, but our research shows that the worst thing to do when leading through a crisis is to move away and avoid the problem. Common tactics in this category include denying that there is a problem, pretending that the problem is overblown, or giving up on the problem entirely. We find that leaders who are effective during crises face stressful challenges head on. They are honest with themselves and others about the size of the problem and put mitigating actions into place as soon as possible. Leaders with a low proclivity for moving away are less likely to become volatile and are more persistent when things go wrong. They remain open to new ideas, maintain trust in their teams, stay engaged and connected, communicate openly and transparently, and are true to their word.

Third, our research also shows that the most effective crisis leaders show compassion and work to stay connected with the needs of their employees, customers, communities, and partners. While an ambitious and steady leader reduces panic and sets out a future plan, employees must also continue to feel valued by the organisation and that their concerns are being addressed. Our research indicates effective crisis leaders score high on the personality trait interpersonal sensitivity and the value altruism. They genuinely care for their colleagues, their communities, and their constituencies, and they act as a unifying force through the crisis.

Summary

Crisis is inevitable, and organisations are well advised to be prepared. The single best way to be prepared for a crisis is to have a leader who is effective at handling crises when they occur. Our decades of research on personality and leadership tell us that the most effective leaders during a crisis are well adjusted, ambitious, realistic about the scope of the problem, steadfast about tackling the problem head on, and deeply compassionate about how the crisis is affecting others. Although it can be difficult to see in the midst of a crisis, organisations with these sorts of leaders have bright futures ahead.