The Uses of Crisis: Taking the Tide at the Flood

Shrinking resources lead gradually to organizational debilitation, often creating an opaque crisis (genuine, but not widely acknowledged within the organization). Despite natural organizational norms to avoid the appearance of crisis, certain conditions militate in favor of declaring a crisis, i.e., making the opaque crisis more manifest, in order better to shock the organization into an appropriate response. The authors’ research in more than 20 educational institutions under financial pressure suggests that the advisability of declaring a crisis depends on two factors—organizational slack and administrative credibility.