Content-Type: text/html

Crisis Management in Singapore and Hong Kong





How Prepared Are Companies in Singapore and Hong Kong for Crises?
- A Comparative Study


Shiyan Dai
PhD Candidate
Department of Management and Organization
Faculty of Business Administration
National University of Singapore
17 Law Link, Singapore 117592
Tel: (65) 654-2010;  Fax: (65) 425-1051
Email:  <a href="/cgi-bin/wa?LOGON=A3%3Dind0109B%26L%3DAEJMC%26E%3D8bit%26P%3D9065822%26B%3D--%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D_279738837%253D%253D_%26T%3Dtext%252Fplain%3B%2520charset%3Diso-8859-1" >[log in to unmask]</a>


Wei Wu, PhD
Assistant Professor
Department of Organisational Behaviour
Faculty of Business Administration
17 Law Link, Singapore 117592
Tel: 874-7854;  Fax: (65) 775-5571
Email: <a href="/cgi-bin/wa?LOGON=A3%3Dind0109B%26L%3DAEJMC%26E%3D8bit%26P%3D9065822%26B%3D--%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D%253D_279738837%253D%253D_%26T%3Dtext%252Fplain%3B%2520charset%3Diso-8859-1" >[log in to unmask]</a>



Abstract
Based on personal interviews with over 400 business executives in Singapore and Hong Kong in two surveys, this paper aims to compare and contrast the two regions in terms of crisis management (CM) planning among the companies. We intend to find out: What is the current situation of CM planning? Are there any common and consistent "Asian" attitudes toward crises and CM there?  And what are the major factors influencing the CM planning there?




Submitted to:  Public Relations Division, AEJMC
How Prepared Are Companies in Singapore and Hong Kong for Crises?
 - A Comparative Study


Organizational crises occur all the time and everywhere around the world.  It seems that we can hardly pass a single day without learning of organizational crises.  Without adequate preparations for crises in advance, an organization may end up paying an exorbitant price for the aftermath of an unexpected crisis.
Numerous crisis cases have shown that proactive crisis management (CM) in normal times will enable an organization to respond successfully to an emergency situation, thus minimizing the losses of various resources, protecting its image and even enhancing the morale of its employees and confidence among its relevant public for the organization and its products/services.  Obviously, CM has become an increasingly important aspect of modern business management.
This paper aims primarily to compare and contrast Hong Kong and Singapore in terms of the CM planning among the business companies.  The two economies, both being dynamic in the region, have been ranked among the so-called "four little dragons" in East Asia for their outstanding economic achievements in the past, and bear prominent similarities in several aspects.  We intend to compare and contrast the findings from the two recent surveys conducted in the two regions[1], exploring possible major factors to account for any significant differences as well as similarities from both organizations' internal and external and cultural perspectives.
An organizational crisis is not just a disaster like an industrial accident or a plane crash or limited to those that cause mass casualties or wide spread environmental damages. In fact, it can take on a wide variety of forms ranging from product recall/tampering, service disruption, product/service boycott, strike, scandal malicious rumors, kidnapping, personnel assault to sexual harassment, bribery, hostile takeover, and natural disaster disrupting a major product/service, or destroying organizational informational system and/or corporate headquarters and so on and so forth (Pearson and Clair, 1998). A review of the organizational crisis literature shows that crisis has been defined in numerous ways (Reilly, 1987).  In a simple way, a crisis is usually a major, unwelcome and unpredictable event that has potential negative results.  It involves a threat to resources and people, loss of control and visible and/or invisible effects on people, resources and organizations (Heath, 199
8).
Despite the variety of its definitions, an organizational crisis can invariably tarnish or ruin the reputation of an organization and its products/services and even threaten the very existence of the organization that handles it.  However, crises do not erupt all of a sudden and most crises have early signals that indicate potential problems.  Adopting an interesting analogy with a biological model, Gonzalez-Herrero and Pratt (1996) proposed that a crisis is just like an organism passing sequentially through phases of birth, growth, maturity and decline or death.  With the intervention of proactive CM, a crisis might be restricted or prevented from developing to its growth and maturity stages.  Furthermore, it may even be unborn as it will be identified very early as an issue of potential concern.
Interestingly, the Chinese equivalent for the English word "crisis" is Weiji, which means danger and opportunity.  The word vividly captures the essence of CM: When handled well, the danger in a crisis can be averted, reduced and even turned into opportunities.  Almost every crisis contains within itself the seeds of success as well as the roots of failure (Augustine, 2000).  One way to secure a positive outcome from a crisis is through effective CM, which means taking action before a crisis looms.
What is CM then?  According to Pearson and Clair (1998), it is "a systematic attempt by organizational members with external stakeholders to avert crises or to effectively manage those that do occur".  Thierry and Mitroff (1992) pointed out that regardless of what crises, effective organizational CM involves managing the five distinct phases through which all crises pass:  (1) signal detection, (2) preparation and prevention, (3) damage containment, (4) recovery and (5) learning.  Clearly, the first two phases fall within the pre-crisis stages and they constitute proactive types of CM (Pauchant and Mitroff, 1992).  Any efforts or activities occurring in these stages are largely aimed at identifying, preventing or averting a potential crisis in its early stage.   In contrast, the third and fourth phases are clearly within the post-crisis stages and any activities done in them are reactive or passive, with an attempt to resist or have a tight control over an out-breaking crisis and
minimize the possible damages of it.  Therefore, they are of reactive CM.  In comparison, the proactive CM is of special significance and importance to any business organization as it will prepare it in many aspects for any unwanted and unexpected crisis situation and also place it in a favorable position when a crisis does occur.
At the heart of proactive CM is comprehensive CM planning coupled with some specific and substantial preparations in terms of organizational and human resources.  Past studies reveal that an organization well prepared for crisis is not only in possession of a general plan for crisis, but also equipped with some specific institution or measures including a written crisis plan (WCP) ready, CM team (CMT) set up and regular drills for employees (Dyer, 1995; Guth, 1995; Heath, 1998; Kamer, 1997-98; Lau, 1987-88; Mitroff and Pearson, 1993; Oshins, 1992; Reilly, 1987; Remsik, 1999; Truitt and Kelley, 1989; Williams and Olaniran, 1998; Wimmer, 1999). Studies have also found that those without a CM plan suffered from a crisis 2.5 times longer than those with an effective crisis plan (Wimmer, 1999).  Sound CM planning has some unique and vital functions including the identification and examination of the possible crisis events as well as issues of potential concerns, specification of respon
siveness tactics and procedures for responding to and handling the issues and events, formulation of a crisis communication plan, and the steps and measures for implementing the plan/s.  Judicious crisis planning may reduce response time and possibly prevent missteps in an organization's initial response to a crisis (Benoit, 1997), as it is capable of eliminating confusion, specifying what needs to be done, and making everyone clear of his own responsibility in a crisis situation (Wisenblit, 1989).  In effect, CM planning is just like an insurance policy to a company (Oshins, 1992).  Without sufficient CM planning, a company's preparedness will be much affected, thus unable to well protect its brand or reputation from the potentially devastating consequences of a crisis.  In those so-called crisis-prone industries such as financial and banking corporations and airlines, in which the probability of crisis occurrence is found to be higher than in other industries, it is extremely important to have adequate CM planning and other preparation measures in normal times.  A detailed crisis plan can mean the difference between an efficient exodus and a disaster (Wimmer, 1999).
In spite of the vitality of CM, however, far too few organizations have systematic and integrated programs in CM (Mitroff and Pearson, 1993).  One recent study found that less than 60% of the fortune 1000 industrial companies and Fortune 500 service companies have an operational CM plan (Wimmer, 1999).

Practices of crisis management in Asia
Some scholars observe that CM in Asia has matured in the past 20 years (Fienberg, 1999).  They find that companies are now demonstrating they have benefited from the difficult lessons of the past.  Senior executives and their financial and legal advisers are more inclined to involve corporate communications consultants and public relations officers in the early stages of restructuring. Even privately held concerns are beginning to incorporate communications planning into their restructuring processes.
However, many other western observers view Asia countries as generally not well prepared for crisis. Boulas (1998) suggests that to cope successfully with the crisis, CEOs in Asia must first overcome three primary challenges: Overconfidence, a historic precedent of quick recovery, and a lack of role models. During a lecture in Malaysia in 1995, management guru, Peter Drucker, warned of the imminent downturn in Asia, citing Horace's famous admonition: "He who the gods would destroy they first bringeth 40 years of prosperity," as a warning to CEOs in Asia of the risks of their overconfidence (Boulas, 1998).  However, his warning seemed not well heeded by Asian governments as evidenced in the ensuing financial crisis.
Likewise, in a cover story of Asian Business, a typical Asian company is described as having not prepared itself to cope well with crises (MacKenzie, 1994).  When discussing the Y2K problem, Cox (1999) also comments that Asia countries, although already hard-hit by the financial crisis, were virtually unprepared. Some technology specialists observe that the complacency of "false sense of security" is a part of a wider problem in Asia, where awareness of the looming disaster lags behind the USA and Europe (Cox, 1999). Boulas (1998) also lamented that lulled into a false sense of security by years of growth, many CEOs in Asia were ill-prepared for the crisis, responding slowly and ignoring critical weaknesses in the processes, controls, and systems needed to manage through a prolonged downturn.
A reason often cited by Asian managers in the past for the lack of crisis preparedness is that there has been no need for such planning when business was good.  Ruidl (1997) believes that this view is consistent with what Meyer (1986: xiv) said about the 'tough sell' of a crisis package in good times.   There are illustrations of the general absence of such management plans among practitioners (Henderson, 1999). For example, the Pacific Asia Travel Association (PATA) found in a recent survey that most of its members, including national tourist organisations, did not include CM in their strategic planning despite a 40% chance of a crisis occurring (Henderson, 1999).
In sum, Asian businesses were described as being complacent in CM and displaying a false sense of security. They were "slow" or "sluggish", and "dragging their feet in preparation"(Cox, 1999).  These behaviors were attributed to some Asian countries' "cultural aversion to failure." Retired US diplomat, David Hitchcock (1998) claimed bluntly, "Asia's crisis is not only economic, but cultural".

Crisis management in Singapore and Hong Kong
Past literature reveals two opposite views about the CM and culture in Singapore.  On the one hand, Singapore is thought of being more prepared and better planned for crises than neighboring countries as evidenced in its being least affected in the past Asian financial crisis. Singapore was also recently praised by a senior WHO official for taking a "far sighted approached" to preventing lifestyle diseases through measures like health screening for its people (The Straits Times, March 28, 2000). Singapore is also one of the countries with highest rate of personal savings. The major reason is that people save money to protect themselves for the unexpected.
On the other hand, other observers describe Singapore companies as being sluggish in CM. For example, Henderson (1999) found in her qualitative study of 10 organizations in the tourism industry in Singapore that none of the organizations had an official CM strategy or a specific plan to cover the circumstances of the recent financial crisis. Some mangers even believed that crisis planning was irrelevant if management was fast on its feet. Henderson reports that there was a feeling that companies had been rather slow to react, failing to realize the magnitude of the crisis.
This study aims to apply the principles in public relations to investigate CM among business companies in Singapore and Hong Kong since CM is an important aspect of public relations.  Gary Kreps (1986) has defined CM as "the use of public relations to minimize harm to the organization in emergency situations that could cause the organization irreparable damage".  Some scholars have speculated that CM practices differ as "cultures" change and argue it is "important to know these distinctions" (Ruidle, 1997). Culture may be considered to be a set of practicing theories held by members of organizations about how life works and recipes about how interactions are conducted. Consequently, culture is not and should not only be the domain of those studying nations, ethnicity and/or gender (Ruidl, 1997).
In Singapore, a culture called Kiasu is very popular among the businessmen as well as the general public. Kiasu, literally translated from the Chinese dialect Hokkien (Fujian province in China), means "afraid of losing (out)."  It has been attributed by many as Singapore's defining national trait (e.g. Lewis, 1991; Ramakrishnan 1998).  As suggested by the literal translation of kiasu, the emphasis is on not losing rather than winning or on reducing risk of failure, rather than striving for success (Ramakrishnan, 1998). Part of the reason why kiasuism quickly became such a widespread word amongst the general public was that the term seemed to capture a real and dormant aspect of Singaporean society. Kiasuism has become a popular buzzword and attached to a wide range of behaviour (Ramakrishnan, 1998). Singaporeans do have other values, but none seems as distinctive as kiasuism. The great spirit of kiasuism unites all Singaporeans, regardless of race, language, culture or creed (Lewi
s, 1991, quoted in Ramakrishnan, 1998, p. 7).  Therefore, it has been argued that in order to adequately understand the Singaporean psyche, one must first consider the construct of kiasuism (Lin, 1994, quoted in Ramakrishnan, 1998, p.7).
Yuen (1998) comments that Singaporean managers are so kiasu that they cannot leave matters to chance or to others. Singaporean managers always plan for future contingencies and seek assurance.  Yuen observes that there is a "permanent sense of crisis" and "today's solution often becomes tomorrow's problem" among Singaporeans.  This kind of "permanent sense of crisis" widespread in the island state has to some extent reflected people's precaution against any unexpected Weiji, or crises, which may be a desirable element in the crisis prevention and planning. Given the prevailing mentality in this particular environment, we assume that there should be some consequence among various companies in Singapore in terms of their extent of preparedness for a crisis.
Interestingly, the popular culture of kiasu mentality in Singapore is found to have an equivalent in Hong Kong.  Local residents in Hong Kong including businessmen are fond of using a pet phrase called mojupshie in their daily activities.  It is originally from the Cantonese dialect meaning "Don't lose out".  Like kiasu, the popular mojupshie shows a certain mentality of the general public living and working in the fast-paced and competition-filled territory, that is, people's aspiration to make more efforts to avoid lagging behind others.
Surprisingly and unfortunately, our search for the past literature about the CM in Hong Kong has landed with very limited findings.  The territory, once a British colony, was handed back to the Chinese sovereignty on July 1 1997 and has ever since become the country's Special Administrative Region.  Over the past few years, Hong Kong has been placed under the spotlight of news media from all over the world for its historic transition and for its being one of the victims hard hit by the devastating Asian financial crisis.  In recent years, quite a few major crises took place in the territory in addition to the sweeping Asian financial crisis.
On the other hand, many companies are found to make active efforts to prepare themselves to deal with unwanted crises.  For example, in the latter half of 1999, 22 local banks in Hong Kong participated in the worldwide computer system test so as to be prepared for any unexpected computer malfunction when it moves into the new millennium (Chow, 1999).  The territory's flag carrier Cathay Pacific and the Hong Kong and Shanghai Bank were reported to have done well in their CM planning by setting up a sound back-up computer system to prevent the disruption of their business operation and protect their data in time of emergency (MacKenzie, 1994).
Yuen (1998) suggests that in the studies on the culture of overseas Chinese communities like Singapore, Hong Kong, and Taiwan, the conventional approach was to consider them as extensions of the traditional Chinese social and cultural heritage.  Comparatively, Singapore and Hong Kong bear prominent similarities in quite a number of areas.  The major ones are as follows:
(1) Singapore and Hong Kong have long been regarded as newly industrialized economies in Asia, ranking with Taiwan and South Korea as "four little dragons", and have been able to maintain a dynamic business arena driven by the mechanisms of customer- and market-orientation throughout the 1980s and most of the 1990s.  Both the two places have also been characterized by enduring prosperity and entrepreneurial spirit for at least three generations (Paik, et al., 1996, Shaw, et al., 1996, Tai, 1996, Taormina, 1998).
(2) Singapore and Hong Kong are both dominated by the ethnic Chinese people, with the approximate proportions being 78 per cent and 98 per cent respectively (Ralston, et al., 1992, Tai and Tam, 1996, Taormina, 1998).  Subsequently, the business companies operating in these two places will invariably be influenced by the similar Chinese cultural values associated with the so-called "Confucian dynamism", as identified and defined by Hofstede and Bond (1988).  The term Confucian dynamism means that the values underlying this dimension come from the teachings of Confucius, an ancient Chinese philosopher (551-479 B.C.).  Based on the five-dimension criteria developed by Hofstede and Bond (1980 and 1988), the city state and China's Special Administrative Region have also been grouped into the same cluster of cultural homogeneity (Ronen and Shenkar, 1985, quoted in Paik, et al., 1996, Taormina, 1998).
(3) Singapore and Hong Kong were both formerly a British colony and served as trading ports under British for a century (Tai and Tam, 1996, Taormina, 1998).  The prolonged Western presence has brought the two regions under the influence of the Western business practices and cultural values (Taormina, 1998) and both follow the pattern of many Western industrialized countries (Tai and Tam, 1996).  The two regions are usually ranked among the most ideal locations in Asia for many Western companies or multinational corporations (MNCs) to set up their regional headquarters.  For example, there are 198 regional headquarters and 228 regional offices of US companies in Hong Kong (Berger, 1997, p6).  In 1997 alone, a total of 22 MNCs got approval to set up their regional headquarters in Singapore (Singapore Yearbook, 1998).  Both Singapore and Hong Kong are widely thought of as a de facto bridge linking up the West and East.
(4) Singapore and Hong Kong have long aspired and competed to become a regional hub in a number of high technology and business sectors.  "Both cities are fierce competitors in the international marketplace" (Taormina, 1998, p473).
In contrast to the abundant and evolving literature about CM in the West, little has been written on the same area in Asia.  So far there has been no empirical study on this topic in an Asian setting. To that end, this study is offered.  Our study aims to explore possible answers to the following questions: Are there any common and consistent "Asian" attitudes toward crises and CM existing in Singapore and Hong Kong? What is the current situation of CM planning in the two regions?  Is it true that companies in the two regions, like a typical Asian company, are less prepared for crises than those in the West as commonly believed by Western scholars?  What are the significant factors influencing the CM planning among the companies in those two industrialized economies? Are they internal organization factors, external or cultural factors?  Are those cultural factors that influence the companies' CM in Singapore also found available and popular in Hong Kong's business circle?   How wi
ll those locally popular cultural phenomena like Singapore's kiasu mentality and Hong Kong's mojupshie impact on the company's CM planning?  Will those cultural phenomena distinguish each other and themselves from other Asian countries in CM?
"Given the common cultural (predominantly Chinese), historical (former British colonies), and economic backgrounds of Singapore and Hong Kong" (Shaw, et al., 1996), we believe the two regions may provide a very meaningful and comparable basis for our study and analysis.  The findings obtained from this study will definitely contribute to enriching the CM research in the Asian setting.  In addition, this study will also be able to add value to the managerial expertise in reality.

Methodology
This study adopts the personal interview as a survey instrument for the data collection in both Singapore and Hong Kong.  A total of about 200 companies of various sizes, business scopes, ownership, business operation length in years and locations were respectively selected in each of the two regions.  Senior executives in those companies who are in charge of crisis communication/management or other relevant functions were interviewed.  In the course of the over 350 interviews with top-level senior executives charged with overseeing CM for their organizations, Mitroff and Pauchant, (1990: xiii) have come to appreciate a vital point:  How senior business and government executives thought about, conceptualized intellectually, and even more significantly, reacted emotionally to the possibility of a major crisis occurring to them and their organizations revealed more about them than all the rational studies of management and organizations.  How people react to crises and/or extreme ev
ents, both real and imagined, provides one of the most powerful windows, if not the most powerful window, into the souls of people and their institutions.


The face-to-face interview method was chosen as the instrument for data collection in this study because it can help ensure that the respondents are managers in the position to address the issue of CM planning for their organizations.  Moreover, the wide variety of issues covered may render a self-administered questionnaire too lengthy for the respondents and the nature of the topic may be too sensitive for them, thereby possibly leading to a low return rate.  Furthermore, since this survey is in a semi-structured format with a mix of closed as well as open-ended, a self-administered questionnaire may yield unsatisfactory results for the open-ended questions, which respondents may leave out unanswered.
All interviews, whether in Singapore or Hong Kong, were conducted by trained interviewers from the professional research company, AC Nielsen in Singapore and Hong Kong respectively.  The interviews in the former were undertaken between March and June 1999, while the task in the latter was conducted from August to October 2000.  Each interview would last about 40 minutes.  The A.C. Nielsen in either of the two regions has over the past years built up and accumulated a reliable network and data-base of company executives for each of the two regions. It also has well-trained staff for tough interviews with busy executives. Therefore, it was chosen to conduct the interviews for the accuracy, reliability, and efficiency of the data collection.
In Singapore and Hong Kong alike, a random sample of companies was respectively drawn from the A.C. Nielsen's Business Database in an aim to enable our research data to represent the whole industrial population in the two regions respectively. Before each interview took place, telephone calls were made to the target company to secure its willingness. Once the appropriate person was identified through screening questions, appointments were made with the respondents. The right respondent has to be someone who is directly involved in the CM of the company. If such a person could not be clearly identified, the Public Relations Officer (for a company with employees numbering more than 30) or Managing Director (for fewer employees) was approached. An Executive Summary of the results was offered as an incentive to increase participation.  All data were collected anonymously in an effort to reduce the possible undesirable effect of the social desirability.
The final sample in Singapore, totaling up to 200 actual interviewees, consisted of 68% senior managers, 27.5% middle managers and 4.5% low-level managers. Of them, 25% said they made the final decisions. Another 25% claimed that they voted on the committee in a crisis situation. The other 50% said they "influence the decision made in a crisis situation."
Similarly, a total of 213 actual interviewees were obtained in Hong Kong.  Of them, 68.5% were senior level managers, 23.5% were from middle level management, while 8% belonged to lower level management.
The questionnaire consisted mostly of close-ended questions. It was structured into five main sections, namely, (1) Perception of Crisis; (2) Preparation for Crisis; (3) The CM Plan; (4) HR Issues in Crisis Preparation; and (5) Particulars of Company, so as to tap into information on the company's perception of crisis and its overall crisis planning status. The closed questions are mostly in the form of 7-point rating scales with descriptive words at the ends of each scale as well as category scales. The questionnaire also consists of open-ended questions for the identification of relevant and interesting issues following some structures choices. Answers to these questions were transcribed by professionals at A.C. Nielsen, and analyzed by the authors.

Findings
Crisis awareness and preparations
        This study finds that many companies across Singapore and Hong Kong were not spared by crises in recent years.  Specifically, more than one third (35%) of the companies interviewed in Singapore and nearly a half (47%) of those surveyed in Hong Kong reported that they were hit by a crisis in the past five years.  Nevertheless, we find that CM planning, a vital part of proactive CM, is not commonly practiced across Singapore and Hong Kong, similar to what has been previously found of Fortune 500 companies.  To our surprise, we find companies operating in Singapore, as a whole, appear to perform better than their counterparts in Hong Kong in preparing themselves for crises.  That is, more companies in Singapore have planned for crises than in Hong Kong.  More than three fourths of companies (76%) in Singapore claimed they planned for crises while only a little more than one third (36%) of the companies in Hong Kong admitted they did the same.
Likewise, more managers in Singapore than in Hong Kong said they realized the importance of having a crisis plan for their companies - as many as 60% of Singapore managers said a crisis plan is "very important" or "extremely important" to their companies whereas only about 28% of the managers in Hong Kong expressed the same, as also can be shown in Table 1, which indicates the means of their perceived importance of having a crisis plan for their companies.  Again, Singapore companies are found to be better than Hong Kong firms in that the average employees and top management in a firm are more knowledgeable about their role in a crisis situation, as shown also in Table 1.
-- Table 1 about here --
        However, when asked about the likelihood of their companies' encountering a crisis within this year and the next three years respectively, managers from Hong Kong seemed more pessimistic than their Singapore counterparts.  Nearly 67% of the mangers interviewed in Hong Kong, in contrast to nearly 77% of their Singapore counterparts, predicted less than 50% chance for their companies to encounter a crisis within this year, while nearly 59% of the managers in Hong Kong, in comparison with 80% of the Singapore managers, expected less than 50% chance of their companies being hit by a crisis within the next three years.  Meanwhile, when asked to compare with companies in the United States, the managers surveyed in Hong Kong perceived higher likelihood for a typical company in the two regions to encounter a crisis than their counterparts in Singapore (about 35% over 25%) (See Table 1 for their means comparison).
All this seems to suggest that the managers in Hong Kong demonstrate a statistically higher awareness or sense of crises than their Singapore counterparts despite that fewer managers in Hong Kong than in Singapore claimed their companies actually made crisis planning, as mentioned above.  Clearly, the results of this study present a mixed or somewhat confusing picture here for those managers surveyed in Hong Kong in terms of their awareness of and actual preparations for crises.
Moreover, although a majority (76%) of the managers in Singapore claimed that their companies planned for crises, only a little more than a half of them admitted their companies did not have either a written crisis plan (WCP) or a crisis management team (CMT).  Among those 200 companies surveyed in Singapore, only 42% have drawn up a WCP, and 43% set up a CMT.  Only about a half of them (53%) trained their employees in normal times to prepare for crises (See Table 2).
-- Table 2 about here --
In a striking contrast, this study shows that the companies surveyed in Hong Kong lag much far behind in taking specific measures for the preparations.  Only four (nearly 2%) and nine (4%) out of the 213 companies actually surveyed claimed that they had a WCP and CMT respectively, while 73 (about 34%) companies said they ever trained their employees for crisis situations.  From the statistics above, we can find a conspicuous inconsistency among the business companies in Hong Kong.  The business companies surveyed in Hong Kong appear to be quite slackening in both their perception of CM importance and specific measures taken, as compared with those companies investigated in Singapore, even though more companies in Hong Kong than in Singapore (47% over 35%) were hit by crises in recent years and higher awareness of crisis was found among those Hong Kong managers interviewed, as also can be see in Table 1 for their means comparison.
When probed further, the most often quoted reason for not having a crisis plan among those managers in Singapore was their confidence of being immune to a crisis attack, with about 38% of them believing a crisis was unlikely.  For example, one manager said "everyone (in our company) will assume that nothing will ever happen to the company." Another top manager was confident that a crisis was unlikely because "never in my 30 years have I experienced a crisis".  Similarly one manager boldly stated that "our company do not plan for any situations. Our operations are in well control and not see the need on it".
In Hong Kong, on the other hand, the most frequently quoted reason for not having any crisis plan was "no need".  One out of three managers whose companies did not plan for crises said crises are unlikely to occur to their companies, and hence, "No need", or "No need to be that serious".  Behind their reply, some other alleged reasons included "company is unlikely to encounter crises", "crises are difficult to predict", etc.  Some managers believed it is simply no use making any preparations, as one said, "Technology advances and market changes quickly.  It is difficult to use one plan to solve all crises."  Another one asserted, "Crises can not be predicted and there are variations of them."  Here we seem to find a sort of resignation mentality existing among those managers, as was the case among some managers surveyed in Singapore.  About one out of five managers interviewed in Hong Kong whose companies did not plan for crises displayed such a resignation attitude, as compared with more than one out of ten managers interviewed in Singapore with the
 same attitude.  They believed crises were due to external factors beyond their control, and there was nothing they could do to plan for it.
In addition, quite a number of the managers across the two regions, about 13% in Singapore and 19% in Hong Kong, cited resource constraints in terms of time, money and manpower, etc.
Moreover, among those companies in the two regions that claimed they have made CM planning, their objectives ranking and priority objective for the planning differs considerably, with about 60% of companies in Singapore indicating "early identification of potential crisis" as their top priority while nearly 61% of the companies in Hong Kong circling out "limitation of damage caused by the crisis" as their top objective.  The managers interviewed in the two regions show a remarkable difference in their ranking of the crisis plan objectives (See Table 3).
---Table 3 about here---

False security for crisis preparedness among companies in the two regions
        A study of the Fortune 500 companies found that almost 90% of them agreed that a business crisis is as "inevitable as death and taxes" (Wilcox, 1997).  However, a majority of companies in Singapore and Hong Kong alike appeared more confident than companies in the West.  Only 20% of those managers from Singapore and 41% of those from Hong Kong interviewed said there was 50% and above chance of their companies being hit by crisis within the next three years.  Moreover, about 86% of the managers from Singapore and 68% of those in Hong Kong claimed their companies were confident to respond well to a crisis when faced with one.
        In reality, nevertheless, companies were found not as well prepared for crises by common standard of crisis preparation, which we believe requires a company to have at least such vital components as a general plan for crisis, a WCP, and a CMT.  This study shows that about 47% of those companies that felt very confident in responding well to an unexpected crisis admitted they did not have a WCP while 41% of those rating themselves at the very confident level of responding to a crisis were found without a CMT.  In comparison, less than 2% and about 4% of the total of 213 companies surveyed in Hong Kong claimed they had a WCP and CMT respectively.
        In Singapore, among those firms that have experienced a crisis before, up to 40% of the managers interviewed admitted that it was not within their companies' control to prevent a crisis from happening.  Only 60% of such companies were optimistic. However, as many as almost 76% of the managers from those companies without any crisis experiences before said they were confident to prevent crises from occurring.
        In comparison, this study finds that, of those companies in Hong Kong that had not any crisis experiences before, 51% claimed it was within the control of their companies to prevent a crisis from happening.
        All these results suggest a very prominent but worrying tendency of false security among the companies across the two regions.

Impact of locally popular cultural factors on crisis management planning
In terms of the impact of the selected locally popular cultural phenomena on the companies' CM planning, this study found that the well-known kiasu mentality prevailing in Singapore was basically conceived to have some positive effect on the CM among company managers.  Of those managers interviewed in this study, 50% perceived it as positive because they believed that such a mentality help companies be prepared for the worst, ensuring all aspects were taken care of.  The majority of the managers surveyed in Singapore held a positive view towards the kiasu mentality. Many managers defined the word kiasu as "being afraid to lose out, competitive", "planning cautiously, covering all bases", "never to lose out", "being afraid to take risks", etc.
Some manager commented that being kiasu was "to safeguard yourself, (it is) not necessary a bad thing by doing more work before anything happens." Others believed that it was better to be proactive.  "Good to be kaisu-to play safe. If you don't do it, you'll regret it," one manager said. Another agreed, "Kiasu is better than "su" (lose).  It's good to stay ahead of competitors by being more competitive". Another senior manager explained that because it was "unable to predict situation during crisis, thus, it is better to be over prepared than under prepared."
The positive side of this widespread mentality in Singapore may probably help account for another finding that the Singaporean-owned multinational corporations (MNCs) showed they were better prepared for crises than those Western MNCs operating in the island state.  As high as 89% of the local MNCs surveyed, compared with 74% of the foreign MNCs, claimed they planned for crises.  Furthermore, the majority of the Singaporean-owned MNCs have respectively prepared a WCP (65%) and CMT (61%).  In contrast, only about 42% and 46% of the foreign-based MNCs did so.  Consequently, up to 82% of the local MNCs said it was within their control to prevent a crisis from occurring compared with less than 70% of the foreign MNCs saying similarly.
Like kiasu, the selected popular pet phrase "mojupshie" in Hong Kong appeared to play a positive role in CM, though the pet phrase did not seem to enjoy such popularity in Hong Kong as kiasu in Singapore and meanwhile the impact of mojupshie on CM was not as prominent.  The results of study show that the respondents in Hong Kong displayed a basically positive perception of the pet phrase mojupshie.  Specifically, a little more than half of the managers surveyed in Hong Kong said they perceived mojupshie as positive, defining it as "Be competitive", "Never lose out - always be the leader", etc., thought there were also some saying the pet phrase had nothing to do with CM.  When defining the pet phrase, a manager in Hong Kong commented, "If you don't do it, you will lose."
When asked about their perception and rating of the direct impact of mojupshie on CM, however, only about 38% of those managers interviewed in Hong Kong said it was quite helpful or very helpful to CM in comparison with 46% of the managers in Singapore saying the same about kiasu.

Discussion
Based on the findings presented above, we have much evidence to presume that the overall CM planning as asserted by many companies in both two regions, especially in Hong Kong, is deficient and not up to a desirable standard.  Many business executives have yet to realize that it is far from enough to take CM into consideration when drawing up corporate plans or make a general plan for CM without specific and rigorous measures for the different stages of CM.  The findings also suggest that many managers are aware that proactive CM should, in addition to a general plan for crisis on the corporate level, include such detailed organizational and human resource measures as WCP, CMT, and regular training programs.
        One conjecture to be made from the results of interviews with the managers in both Singapore and Hong Kong is that top management in many companies had underestimated the importance of instituting formal crisis-prevention mechanisms and of having rigorous procedures to ensure they can respond properly to any emergency situations.  Despite the obvious mismatch known to many managers between the crises their companies prepared for and the crises that most threatened them, many of them that admitted it was beyond their control to prevent a crisis nevertheless did not plan for it.  The high disjunction suggests that the CM preparations among many organizations are not geared up to their vulnerabilities.
Another finding worthy of our special attention is the widespread false security or over-confidence among many managers across the two regions, especially those without any crisis experience before and those without any CM measures. In this aspect, the worrying phenomenon is more prominent in Singapore than in Hong Kong, as evidenced by the statistics listed above.  This kind of mentality co-exists with but poses in striking contrast to those in favor of Kiasu mentality in Singapore and Mojupshie in Hong Kong.  In fact, it could be quite dangerous, especially to those managers who said their companies had no crisis experience before or had no WCP or CMT but nevertheless felt confident to prevent any crisis.  Obviously, their confidence is based on something subjective other than specific and substantial preparations, which can have an insidious impact on their organizations once a crisis breaks out in future.
The unusual inconsistency existing among many companies in Hong Kong as indicated in the previous part should also merit our special attention and pondering.  This unusual situation might probably be attributed to some factors such as:  (1) The past Asian financial crisis has affected Hong Kong much more seriously than Singapore.  The devastating financial crisis as well as other major crises occurring in Hong Kong in recent years might have left more managers in Hong Kong than in Singapore with a so-called resignation belief or attitude that it is difficult to predict, prevent or control any crisis with their existing resources and capacity, and hence no point doing anything about it.   This resignation attitude can be found in their responses to some open-ended queries during the interviews.  (2) Both Hong Kong and Singapore fall into the same group of what Hofstede (1991) labeled as low uncertainty avoidance (UA), which means, among other things, the "extent to which people fee
l threatened by ambiguous situations and have created beliefs and institutions that try to avoid these" (Hofstede and Bond, 1984, p. 419). The higher the UA index, the more uncertain and unknown situations and ambiguity are felt to be threatening.  With Hong Kong's location classified in higher UA index or more uncertain environment (as compared with that for Singapore, i.e. 29 over 8), and direct experience from the past Asian financial crisis and other crises in recent years, plus the so-called resignation attitude, managers in Hong Kong might be more likely to display such an inconsistency as discussed above.  (3) The governments in the two regions have long been thought of as functioning in a somewhat different style. The Singapore government has tended to be protective and supportive to the enterprises, providing various forms of supportive policies and subsidies and aids for the industrial sectors, while the Hong Kong government's influence and control for industrial sectors
 has been minimal (Vogel, 1991, quoted in Paik, et al., Berger and Lester, 1997, p.21).  As a result, even though some managers in Hong Kong, not less than their counterparts in Singapore, realized the importance of proactive CM and crisis planning, their companies may have comparatively limited access, in comparison with those in Singapore, to the needed resources for the proactive CM and have therefore shown sluggish preparations in reality.
Comparing the importance rating of top objectives for their CM planning as shown in Table 3, we find that the companies in Singapore seem to be more concerned about the detection and prevention of crisis, which is what we considered more proactive CM, while companies in Hong Kong are more inclined towards containment or control of crises, which is reactive or passive CM.  From an overall point of view, however, the findings of this study show that the useful practices of a WCP and CMT are seldom adopted among business companies in Hong Kong and are received only by some companies in Singapore, even though past crisis cases have proved the vital roles of them in CM as a whole.  Some companies across the two regions may reject the idea of having a formal crisis plan as a more Western approach and that such a management style may not be very practical when applied to their situation in the local.  Those companies without a WCP or CMT may have preferred to operate according to their top managers' gut instinct.  To them, prompt containment of a full-blown crisis and quick recovery from the unwanted incident seem to outweigh the proactive preparedness prior to the outbreak of a crisis.  For such companies, patience may b
e needed before they come to realize the importance of proactive CM.  It could also be that the company does not possess the know-how of CM. However, their vulnerability should cause a wide concern and worry, especially those companies without prior crisis experience and proper planning but displaying high confidence to respond well to crises.
The results of this study also suggest that companies have more learning and training to do in future.  About half (47%) of companies in Singapore and 65% of companies in Hong Kong never provided any training for their employees to prepare for or handle a crisis. As a result, there exists a big gap between employees' and top management's knowledge level about their role in a crisis situation. In Singapore, 35% of top managers were "extremely knowledgeable" of their role, while only 4% of employees were believed so.  In comparison, about 44% of top managers and 9% of employees in Hong Kong reached the level of "extremely knowledgeable" about their role in a crisis situation.
Wimmer (1999) suggests that given the general economic and political environment in much of Asia, and the potential for natural or man-made disasters, every overseas business entity should have a CM plan, covering a variety of contingencies, and an emergency evacuation plan component.  The past devastating Asian financial crisis should serve as an unforgettable lesson for numerous companies in certain areas that it is imperative to make adequate preparations at normal times for any unexpected crisis.  However, the sluggish CM preparations as among companies in Hong Kong is rather surprising and worrying to us, given that Hong Kong was hit harder than was Singapore during the past Asian financial crisis.  As a whole, there is no conclusive evidence yet indicating that Asian companies are less prepared for crisis than their Western counterparts.  This comparative study turns out a mixed result.  All these findings seem to point to a fact that Asia is not monolithic and both differen
ces and similarities can be generated from the same Chinese culture-based regions, as has been asserted and proved by numerous past studies in management and marketing areas (Paik et al, 1996; Tai and Tam, 1996; Taormina, 1998).
The popular cultural mentality like kiasu or mojupshie is found to have some positive impact on the work of CM in each of the two regions despite their somewhat negative connotations as held among the public. However, it is far from enough to draw any conclusion about the pervasive mentality under study so far.  To support our assumption, we need further research, identifying other possible valid cultural factors and/or comparing companies from the perspective of their corporate culture in each of the two regions.  Moreover, the difference between the governments in two regions might also have exerted a significant impact on CM among companies in either of the two regions.  Nevertheless, in business management today, we believe one can never overemphasize the importance of CM, especially those proactive preparations prior to any crisis, and those locally-popular mentalities or other relevant cultural factors may probably be taken as a helpful tool to prompt business people to gear themselves up in the work of CM.







































    Table 1: Comparison of the Means Derived From Relevant Responses
  Between Singapore and Hong Kong


    Perception of the                             Singapore                 Hong Kong
    Following Items                               (N = 200)                    (N = 213)

                                                                  Mean                           Mean

1. Likelihood of facing a crisis
    m.    During this year                                 1.34                                1.44
    n.     Within next 3 yrs                               1.27**                             1.55**

2. Likelihood of a typical firm to
    encounter a crisis in comparison             1.97*                               2.17*
    with the firms in US

3.  Importance of having a crisis plan
      for your firm                                             2.55**                            2.14**

4. Confidence perceived to respond
       to a crisis that hits your firm                  2.51*                             2.38*

5. Level of knowledge of _in your
    firm about his role in a crisis?
       x.  Average employees                             2.12**                           2.08**
       y.  Top management                                2.80**                           2.69**

_______________________

Note:
The means are derived from the scales above, as denoted in the following:
    a.  Items 1 - 2 range from 1 (Less than 50% chance) to 3 (more than 50% chance);
    b.  Items 3 - 5 range from 1 (Not at all) to 3 (Extremely).
*_<0.05; **_<0.01











Table 2:  Companies' Preparedness for Crises



Companies'
Preparedness
 of crises

Singapore
%

Hong Kong
%

Yes

No

Yes

No

Plan for Crisis


WCP Ready


CMT Set Up

76.0
(n=152)

42.0
(n=84)

43.0
(n=86)


23.0
(n=46)

56.5
(n=113)

56.5
(n=113)


35.7
(n=76)

1.9
(n=4)

4.2
(n=9)

60.6
(n=129)

96.2
(n=205)

95.8
(n=204)
Note:  "WCP" stands for written crisis plan, while "CMT" stands for CM team.





















Table 3: Reasons for Crisis Planning


Crisis Plan Objectives Ranking

% Saying "Most Important"
Singapore

N = 200
Hong Kong

N = 213
Early identification of potential crisis
59.5
39.4
Assured continuation of business during a crisis
53.5
54.5
Efficient management of an occurring crisis
48.5
55.9
Limitation of damage caused by the crisis
46.0
60.6
Quick isolation of a crisis
42.0
46.0
Clear delegation of responsibilities during a crisis
41.0
32.9
Consistency of response across the company
31.0
32.9




















REFERENCES
Benoit, W. L. 1997.  Image repair discourse and crisis communication.  Public Relations Review, 23(2): 177-186.

Bland, M. 1998. Communicating Out of A Crisis.  London:  MacMillan Press Ltd.

Boulas, C. 1998. The long journey back. Asian Business, December 1: 16

Chow, K. K.  1999.  Recovery from adversity - Crisis management.  Hong Kong: Wan Hon Publishing Co.

Cohn, R. J. 1991.  Pre-crisis management.  Executive Excellence,  October: 19.

Cox, J. 1998. Already hard-hit region virtually unprepared. USA Today, April 13: 3B.

Dyer, S. C. 1995.  Getting people into the crisis communication plan.  Public Relations Quarterly, (Fall): 38-41.

Fienberg, B. 1999. Communicating in a crisis. Asian Business, May: 70.

Fink, S. 1987.  Crisis Management - Planning for the Inevitable.  New York: American Management Association.

Fugel, J. A. 1996.  Planning is critical to effective crisis communications. Rural Telecommunications,  May/June: 62-65.

Gonzalez-Herrerso, A. and Pratt, C. 1996.  An integrated symmetrical model for crisis-communications management.  Journal of Public Relations Review, 8(2): 79-105.

Harrison, G. 1994.  Culture and Management (Cover Story).  Australian Accountant, November: 14-22.

Heath, R.  1998.  Crisis Management for Managers and Executives.  London:  Financial Times Professional Ltd.

Henderson, J. 1999. Managing the Asian Financial Crisis: Tourist Attractions in Singapore.  Journal of Travel Research, 38: 177-181.

Hermann, C. F.  1963.  Some Consequences of Crises Which Limit the Viability of Organizations.  Administrative Science Quarterly.  8: 61-82.

Hitchcock, D. I. 1998.  Asian crisis is cultural as well as economic. Christian Science Monitor, April 9: 19.

Irwin, H. 1996.  Communication with Asia - Understanding people and customs.  Sydney: Allen & Unwin.

Kamer, L. 1997-98. Crisis planning's most important element:  The drills.  Communication World,  December/January:  27-29.

Kreps, G. L. 1986.  Organizational communication.  New York: Longman.

Lau, B.  1987-88.  Crisis communication planning for organizations, Part II.  NRECA Management Quarterly, 25-28.

Lenartowicz, T., & Roth, K.  1999.  A framework for culture assessment.  Journal of International Business Studies,  30(4): 781-798.

MacKenzie, A. 1994.  Dealing with disaster. Asian Business, July 30: 20-24.

McDonald, G. M., & Kan, P. C.  1997.  Ethical perceptions of expatriate and local managers in Hong Kong.  Journal of Business Ethics,  16: 1605-1623.

Meyer, G.C. & Holusha, J. 1986.  When it hits the fan:  Managing the nine crises of business. New York: Mentor Books, New American Library.

Mitroff, I.I., & Pearson, C.M. 1993. Crisis management. San Francisco: Jossey-Bass Publishers.

Mitroff, I.I., Pearson, C.M., & Harrington, K. 1996.  The Essential Guide to Managing Corporate Crises.  London: Oxford University Press.

Mitroff, I.I. & Pauchant, T.C. 1990.  We're So Big and Powerful Nothing Bad Can Happen to Us: An Investigation of America's Crisis Prone Corporations.  New York: Carol Publishing Group.

Oshins, A. 1992.  Maintaining continuity during a crisis.  Risk Management,  39(12): 55.

Paik, Y., Vance, Charles M., & Stage, H. D.  1996.  The extent of divergence in human resource practice across three Chinese national cultures:  Hong Kong, Taiwan and Singapore.  Human Resource Management Journal,  6(2): 20-31.

Pearson, C. M. & Clair, J. A. 1998.  Reframing crisis management.  Academy of Management Review, 23(1): 59-76.

Ramakrishna, M. 1998. Effects of anxiety and scarcity of resources on kiasu behavior. Academic Exercise. Singapore: National University of Singapore.

Remsik, J. J. 1999.  A crisis communication plan - A vital element in Y2K readiness.  Direct Marketing.  Garden City. July: 32-37.

Ruidl, R. A. 1997.  Five key areas of crisis communication: Hong Kong practitioners state their views.  Paper presented to the Third Annual Conference of the David C. Lam Institute for East-West Studies, Hong Kong.

Siu, W. 2000.  Marketing philosophy and company performance of Chinese small firms in Hong Kong.  Journal of Marketing, Winter:  25-36.

Tabris, M. D.  1984.  Crisis management. In B. Cantor and C. Burger (eds.), Experts in Action:  Inside Public Relations.  New York: Longman, Inc.

Tai, S. H.C. & Tam, J. L. M. 1996.  A comparative study of Chinese consumers in Asian markets - A lifestyle analysis.  Journal of International Consumer Marketing, 9(1): 25-42.

Taormina, Robert J. 1998.  Employee attitudes toward organizational socialization in the People's Republic of China, Hong Kong, and Singapore.  The Journal of Applied Behavior Science, 34(4): 468-485.

Thierry, C. P. & Mitroll, I. I.  1992.  Transforming the Crisis-Prone Organization - Reviewing Individual Organizational, and Environmental Tragedies. San Francisco:  Jossey-Bass Publishers.

Ulmer, R. R., & Sellnow, T. L.  2000. Consistent questions of ambiguity in organizational crisis communication:  Jack in the box as a case study.  Journal of Business Ethics,  May issue.

Traverso, D. K. 1993.  How to develop a crisis communication plan.  Occupational Hazards,  March: 58-61.

Williams, D. E. & Olaniran, B. A.  1998.  Expanding the crisis planning function:  Introducing elements of risk communication to crisis communication practice.  Public Relations Review,  (24(3): 387-400.

Wilkinson, B.  1996. Culture, institutions and business in East Asia.  Organization Studies,  17(3): 421-447.

Wimmer, B. 1999. Cool in a crisis.  Asian Business, February 1: 17

Wisenblit, J. Z. 1989. Crisis management planning among U.S. corporations:  Empirical evidence and a proposed framework. SAM Advanced Management Journal, 31-41.

Yuen, C.C. E. 1998. Social -cultural context of perceptions and approaches to conflict: The case of Singapore. In K. Leung & D. Tjosvold (Eds.), Conflict Management in the Asia Pacific: Assumptions and Approaches in Diverse Cultures, 123-146.  Singapore: John Wiley & Sons (Asia).




[1]   For the sake of convenience, a generic term "region" will be used throughout this paper to refer to both Hong Kong and Singapore.