The Worst Mistakes Businesses Make During a Crisis—and How to Avoid Them

22 May 2025

We live in unpredictable times, right? Whether it’s an economic downturn, a sudden PR disaster, or a global pandemic, crises are bound to happen. The hard pill to swallow is that no business is immune to them. But what separates businesses that crumble under pressure from those that emerge stronger is how they handle these tough situations.

Unfortunately, many companies make the same avoidable mistakes during a crisis. Oftentimes, these errors don’t stem from a lack of resources but rather from poor planning, panic-driven decision-making, or just plain denial. And let’s be real, when you’re in the thick of a storm, it’s hard to think straight.

So, let’s break it down. Here’s a list of the most common mistakes businesses make during a crisis and practical advice on how to steer clear of them like the plague.

1. Ignoring the Crisis or Hoping It Will Pass On Its Own

If I had a dollar for every time I saw a company bury its head in the sand during a crisis, I’d be rich! Denial is one of the biggest mistakes businesses make. Pretending nothing’s wrong or convincing yourself it’ll “blow over” is not a strategy—it’s procrastination.

Why This Is a Problem

Think about it: if your house is on fire, you wouldn’t ignore the flames and hope the fire magically extinguishes itself, would you? The longer you wait to act, the worse the damage will be.

What You Should Do Instead

Face it head-on. Acknowledge the issue right away, even if it feels uncomfortable or overwhelming. Transparency is key here. Your employees, customers, and stakeholders will appreciate honesty over you acting like everything is fine when it clearly isn’t.

2. Failing to Have a Crisis Management Plan

Here’s the thing: a crisis doesn’t send you a calendar invite. It just shows up unannounced, like that one neighbor who always stops by at dinnertime.

Why This Is a Problem

Without a plan, you’re scrambling to figure out what to do while the clock is ticking. Decisions made in panic often lead to more harm than good.

What You Should Do Instead

Make a crisis management plan today—yes, even when things are going smoothly. Think of it like an emergency kit. Include procedures for communication, damage control, recovery, and assigning roles. Plus, rehearse that plan. Having a plan isn’t enough if nobody knows how to execute it when the time comes.

3. Poor Communication With Employees

Here’s an unpopular truth: during a crisis, your employees are just as stressed and anxious as you are—maybe even more. They’re looking to you for guidance. And silence? Well, that breeds fear and mistrust.

Why This Is a Problem

If you’re tight-lipped or too busy addressing external concerns, your team may resort to gossip, speculation, or plain old panic. A disorganized and demoralized workforce is the last thing you need during a crisis.

What You Should Do Instead

Communicate early and often. Share what you know, what you don’t, and what steps are being taken. Be transparent without sugarcoating the situation, and remember to listen to their concerns too. Bonus tip: a team-wide Zoom call or town hall meeting can work wonders.

4. Neglecting Customer Relationships

The phrase “out of sight, out of mind” rings disturbingly true during a crisis. Some businesses get so wrapped up in behind-the-scenes chaos that they ghost their customers entirely.

Why This Is a Problem

When customers feel ignored or abandoned, they won’t hesitate to switch to a competitor. Brand loyalty is fragile, and a crisis can either strengthen it or shatter it.

What You Should Do Instead

Keep your customers in the loop. Send out emails, update your website, and stay active on social media. Let them know how the crisis affects your services or products and what you’re doing to address it. And hey, a little empathy goes a long way—put yourself in their shoes and offer solutions that add value. Whether it’s offering flexible payment options or a heartfelt apology, show that you care.

5. Making Rash Decisions Without Data

When the pressure is on, it’s tempting to act quickly just to feel like you’re “doing something.” But acting without proper analysis can be like shooting in the dark—you might hit your target, but you’re more likely to miss.

Why This Is a Problem

Emotional, knee-jerk decisions can worsen the situation. Maybe you slash your marketing budget only to realize later that it was driving crucial revenue. Or perhaps you lay off staff, only to struggle to rebuild your team when the crisis ends.

What You Should Do Instead

Pause, breathe, and analyze. Use the data at your disposal to guide your decisions. If you don’t have clear numbers, consult experts or advisors for guidance. It’s better to take a little extra time to make an informed choice than to rush and regret it later.

6. Focusing Only on the Short Term

When you’re putting out fires, long-term planning can feel like a luxury you can’t afford. But guess what? Short-term fixes without thinking ahead can create long-term headaches.

Why This Is a Problem

You might keep the lights on today, but what happens tomorrow? For instance, cutting costs too aggressively can hurt your ability to invest in innovation or talent down the line.

What You Should Do Instead

Think of the crisis as a temporary storm. Yes, you need to survive it, but also position yourself to thrive once it’s over. Make decisions that balance immediate needs with future goals. Treat the crisis as an opportunity to reassess and adapt your business strategy.

7. Forgetting About Mental Health

Let’s call it like it is: crises are stressful—for everyone. But many businesses overlook the toll it takes on their employees’ mental health and, honestly, on their own.

Why This Is a Problem

Burnout is real. Overworked, stressed-out employees can’t perform their best. And as a leader, if you don’t take care of yourself, you’ll struggle to lead effectively.

What You Should Do Instead

Encourage mental health breaks and offer support. Maybe it’s flexible work hours, access to counseling, or just a simple “how are you holding up?” conversation. And don’t forget to take care of yourself too. Remember, you can’t pour from an empty cup.

8. Damaging Your Brand by Over-Promising

In an effort to keep customers happy during a crisis, some businesses over-promise and under-deliver. While it might seem like a good idea to offer reassurance, breaking those promises can do more harm than good.

Why This Is a Problem

Think about it—if you promise uninterrupted service but then fail to deliver, you risk losing the trust you’ve worked so hard to build. Trust is like a bank account; it takes ages to save but seconds to spend.

What You Should Do Instead

Be realistic. It's better to under-promise and over-deliver than the other way around. If you know there will be disruptions, communicate that honestly and set expectations accordingly.

9. Not Learning From the Crisis

After the dust settles, many businesses simply go back to “business as usual” without reflecting on what went wrong—or right. That’s a missed opportunity.

Why This Is a Problem

If you don’t learn from a crisis, you’re doomed to repeat the same mistakes. Reflecting is what turns a setback into a stepping stone.

What You Should Do Instead

Once the crisis has passed, gather your team and do a thorough debrief. What worked? What didn’t? What could you do differently next time? Document these insights and use them to refine your crisis management plan.

Wrapping It Up

Look, no one likes dealing with crises. They’re messy, stressful, and full of uncertainty. But the truth is, they’re a fact of life in the business world. The good news? Mistakes are preventable—if you’re proactive, transparent, and intentional.

By avoiding these common pitfalls and preparing for the unexpected, you’ll not only weather the storm but potentially come out stronger on the other side. And hey, isn’t that what resilience is all about?