Ivane Javakhishvili Tbilisi State University Paata Gugushvili Institute of Economics International Scientific
C O N F E R E N C E S
"ECONOMY – XXI CENTURY"
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∘ Manana Kharkheli ∘ Giorgi Morchiladze ∘ ISSUES TO BE CONSIDERED IN COMPANIES DURING CRISIS SITUATION Summary The spread of the pandemic around the world has significantly changed the rules for doing business in many companies. Organizations in the services, construction, or other sectors faced serious problems, and some of them stopped working altogether. The reality is that many organizations have turned to a crisis. In turn, in a crisis situation, companies need to rethink their strategy and change, in order to survive and adapt to a changed environment. Making changes is often difficult because, among other reasons, the interests of interested parties (employees, suppliers, customers, etc.) overlap significantly. That is why this article discusses the importance of using the practice of “procedural justice” in organizations, which are in crisis situation, because it helps companies to implement the changed strategy effectively in a difficult condition. Creation of term "procedural justice" is related to two social scientists: John W. Thibaut and Laurens Walker. Their research determined, that humans care as much about the justice of the process through which an outcome is produced, as they do about the outcome itself. People’s satisfaction with the outcome and their commitment to it rose when procedural justice was exercised [J.Thibaut, L.Walker“, 54]. In our opinion, the practice developed by W. Chan Kim Renée Mauborgne, is quite interesting, which are based on the research of J.Thibaut, L.Walker. This practice is based on three elements, namely: Engagement, Eplanation, Expectiation. To explain one by one:
In conclusion, we can say that in a crisis situation, companies should be careful when working with interested parties, because if they make a mistake, correcting the situation will be much more difficult than in a situation when the company grows. In turn, implementation of procedural justice will help Management, to reduce the risk of mistake during co - working with stakeholder. Keywords: Crisis Management, Change Management, Fair Process |