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Causes of the crises in enterprise

Crises appear in every company and we will not run away from it. You can't run your business perfectly all the time. It is true that nearly 40% of crisis situations in enterprises is the result of a lack of proper communication. Another 20% is caused by bad ad campaigns. What connects both of these factors that are responsible for the emergence of a crisis in a company?

Find factors that are the common denominator for defining the source of the crisis

The common denominator is not only the weakening of the company's image, but also the loss of customer trust. Crises - like almost everything else - can be classified exactly. The basic classification consists in dividing the types of sources of such situations - it is divided into external and internal.

External causes of the crisis - what are they?

Let's start with the factors causing the crisis, which are referred to as external. We divide them into two groups:

● Reasons related to the macro-environment of the enterprise,
● Reasons related to the micro-environment of the enterprise.

The term microenvironment is mainly understood as the so-called "Competitive environment". However, before we analyze the factors responsible for the crisis in the enterprise, which are related to the micro-environment, let's take a closer look at those that are directly related to the macro-environment.

The economic situation defines how a given enterprise functions

As a rule, an enterprise functions in a specific economic situation. Sudden changes in this situation may contribute to the emergence of a crisis and these will be external factors. A very important external factor that may cause a crisis in a company is the increase in interest rates - this directly affects consumers and the prices of goods and services. Another very important factor causing the crisis, known as an external cause, could be a decline in the level of people's income - such as, for example, at the time of the economic closure due to the pandemic. These factors can significantly translate into the company's profitability and its development.

Micro-environment and factors that cause a crisis

The situation is completely different when it comes to the causes of the crisis, which are defined as those related to the micro-environment. Here, first of all, all unfavorable changes that affect our business partners should be indicated. Their unfavorable situation can easily translate into the situation of our company. Undoubtedly, a very important external factor when it comes to micro-environment are various types of payment gridlocks. In this case, the crisis of our company will be related primarily to maintaining financial liquidity. Also, changes in the prices of goods or services, which are dictated by a given sector of the economy, may translate into a crisis in our company.

Internal factors that may trigger a crisis in the enterprise

A crisis in a company can also be caused by internal factors. Just as external factors have been divided into two groups, we are also able to divide the causes of the crisis into several areas, referred to as internal. They are related to the following areas of the company's activity:

● Employees,
● Strategy,
● Finance,
● Technique,
● Organizational structures.

Due to such a large number of internal areas responsible for the emergence of the crisis, we can also distinguish a very large number of their causes. Regardless of what will cause the crisis in the enterprise, appropriate actions should be taken to deal with it.

How to deal with a crisis in an enterprise?

Defining the causes of the crisis is an absolute basis for taking action to eliminate it. However, it is worth planning and implementing these activities one by one. It is also good to designate people who will be responsible for particular areas of eliminating the crisis. Then the chance of successfully dealing with it increases significantly.

Do you need help with your business development?

Bartosz Zieliński

Bartosz Zieliński Managing director

+48 665 379 071
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