PAN-PAN! An airline’s lesson in staying calm in crisis


PAN-PAN! An airline’s lesson in staying calm in crisis Ethical BoardroomBy Tom McLeod – Managing Consultant, McLeod Governance




A few weeks ago over the clear, cold winter skies of Sydney in Australia, a China Eastern passenger plane bound for Shanghai radioed that it needed to make an emergency landing.

Anxious passengers described hearing a very loud noise and a burning smell soon after MU736 left Sydney Airport on the Sunday evening. What they most likely heard – for it is now the subject of an official air safety investigation – was an explosion in the left-side wing engine casing that left a large hole. Thankfully, the plane was able to return safely to Sydney for inspection.

Media reports at the time shared the cockpit’s voice recording and what was noticeable was two-fold – firstly the calmness and professionalism of both the air traffic control and the China Eastern pilots and, secondly, the use of the phrase ‘pan-pan’ to describe the situation.

The use of pan-pan was appropriate and consistent with the universally accepted distress signal hierarchy of mayday and pan-pan. Mayday is used when there is imminent danger to life or the continued viability of the distressed vessel.

Pan-pan is used to alert everyone that there is an urgency on a vessel but that – in the opinion of the caller – there is no immediate danger to life or the vessel itself. Watching the media reports and listening to the audit it struck the author that, at least in terms of matters of life and death involving stricken crew and passengers, there is a consistent framework for airline staff to handle a crisis in a manner so that everyone understands the importance of the message and the level of response that the stricken vessel could expect.

It’s worth taking a moment to consider that again: a consistent framework to handle a crisis; in a manner that everyone understands the importance of the message; in a manner that everyone understands the level of response that the stricken vessel could expect.

How many organisations can say that – outside specific areas where, as is the case here, there is government intervention for the betterment of society – they have something similar in place.

Crises – by their very nature, for it wouldn’t be called a crisis otherwise – happen when you least expect it. They can be – and are – man-made, acts of God, financial, operational or reputational. They, of course, can also threaten life and limb, as was the case with the China Eastern saga. So how does one develop a framework that addresses such a myriad of potential circumstances?

Firstly, it is by acknowledging that you can’t prepare for every possible scenario but you can put in place mechanisms that allow you to consider every possible scenario. The most effective frameworks that we have developed and reviewed are those that are based on clear and well-articulated principles.

What those principles are is ultimately at the determination of the relevant organisation. The British standard on crisis management does a good job in seeking to define them. For us, there are five key principles that we have relied on in more than a quarter of a century of reviewing crisis responses.


Acceptance that the world is a confusing place sometimes and that a crisis management framework is not necessarily seeking to control that confusion but seeking to manage the organisation’s response to it. These objectives are fundamentally different. Many an organisation has tried to do the former only to make the latter much more difficult to achieve.

“There is a consistent framework for airline staff to handle a crisis in a manner so that everyone understands”

Acceptance that not everyone sees the world in the same way that you do. This is particularly important in a crisis. When the proverbial organisational sun is shining it is very easy to be lulled into the thought that there is broad agreement on how things should progress. When the dark clouds of uncertainty visit in the shape of an unexpected event that collegiate assumption is often the first tenant to be sorely tested.

Accepting that that is the case and designing your crisis management framework to be open to different views is a critical aspect of a robust response. A word of caution, though – accepting that there are divergent views is not the same as endlessly debating those divergent views. There is no such thing as a perfect crisis management plan, just one that is best suited to the circumstances.

You can’t endlessly consider your options in an environment where the crisis itself has robbed you of the one commodity you need most –and that is time.


The cliché that success has many fathers but failure is an orphan could have been written specifically for the post-event evaluations on how one responds to a crisis. A crisis managed well soon leads to a return to business as usual. A crisis poorly managed will lead to finger pointing and organisational retribution.

While I acknowledge that this is a scientifically untested hypothesis, we would suggest those times where there has been a crisis managed well there has been someone that has been given by the crisis management framework accountability to do something and that they have done that something exactly as was envisioned.

This accountability is not in terms of a title – we should note that we are not a great fan of a ‘crisis management leader’ title as it suggests that those with ‘normal’ operational responsibilities can somehow abdicate their responsibilities in the moment of greatest need.

The accountability that we mean is more in terms of being capable of taking control and being seen to be capable of taking control. Nothing is more cancerous to the likelihood of a successful management of a crisis than when those seeking leadership look to those with designated accountability and see that those that have been gifted the awesome responsibility have shirked their obligations at the worst possible time.


There is a wonderful New Yorker cartoon, that mocks the recent trend towards anti-intellectualism. In the cartoon a passenger on a plane stands up and declares: “These smug pilots have lost touch with regular passengers like us. Who thinks I should fly the plane?”

If there is one place – actually there are many places, including an airplane – where you don’t want overconfident amateurs then it is in a crisis or, equally importantly, in the construction of a well-thought-through crisis management plan. When that moment of great urgency visits your organisation it is no time to be testing out whether someone is competent or not at their role. You need the very best to be giving their very best.

Sometimes short-sighted organisations will invoke the specter of cost management as a reason to perhaps go with that person that little bit less experience or who hasn’t actually gone through a crisis before but has read about it in a Harvard Business School case study. Resist that temptation as strong as you can.

The money spent on subject matter experts with relevant and recent expertise will be repaid many times over for the simple reason that they will be able to make rational decisions based on an understanding of the consequences much quicker than someone that is making such fraught decisions for the first time.

In a crisis, it is worth reiterating that time is the most critical factor you have. Don’t waste it and don’t think that you are doing your organisation any favours by cutting costs at this most precarious of moments.


Misery may love company. In a crisis, conspiracies love an information vacuum.

A CEO once told me about their response to a food contamination scare of an international subsidiary of a major American company. The communication protocol within that organisation was that everything had to go through corporate head office before being released. That sounded good in practice but for the fact that the food contamination scare happened on the other side of the world to where corporate head office was and where it was Sunday afternoon.

The CEO had to make a decision as to whether he respected the business as usual protocol or to take matters into his own hands. He erred on being transparent with all his stakeholders as soon as possible. When challenged by his superiors he said that he wanted to make sure that everyone had at their disposal all the information that he had so that educated decisions could be made.

A well-constructed crisis management plan enshrines transparency as a core value. This is not to say that you need to be giving everyone a play by play to the detriment of actually managing the crisis, but it does mean that you need to be ready. A way to do this is to designate someone as the sole person who can speak on behalf of your organisation so that others have their focus elsewhere.

“In a crisis, it is worth reiterating that time is the most critical factor you have. Don’t waste it and don’t think that you are doing your organisation any favours by cutting costs at this most precarious of moments”

Equally importantly, your framework needs to consider – and test pre-crisis – your approach to communication. Should you have pre-prepared statements that mirror the general stages of a crisis and fill in the unknowns as and when needed?

If you are not comfortable with that, have you decided what approval process will be enacted in the event of a crisis, remembering that the normal review and approval channels that a ‘traditional’ communication piece would be subjected to are likely to be too cumbersome in the event of an emergency?

And have you debated – outside the intensity of a crisis – whether your organisation would be comfortable in releasing publicly that you have no information that can better decipher the current crisis than that which everyone else has? This last point is one that is hotly debated within organisations.

Does the admittance of limited or no knowledge enhance or hinder the credibility of your crisis recovery effort? We have always thought that the best strategy is to err on the side of too much communication as it generates trust that you will tell stakeholders what you know as soon as you know it.

If you are seen to be less than transparent what happens is that prejudices and gripes usually completely unrelated to the matter at hand are brought in by mischievous players that may see the crisis as an opportunity to further their agenda.


This may sound a strange criteria to have in an otherwise esteemed list of values that should be incorporated into a robust crisis management plan. Yet, for us, it is on par with all the others.

A crisis is an unpredictable cyclone of events, information, emotion and – nearly inevitably – blame. In such an environment, it is critical that there be as near as possible contemporaneous documentation of the key events and decisions. Why? When the post-crisis review (as should happen after all crisis incidents) comes and the moment for learnings is upon the organisation, you want to be able to rely on as near as possible objective chronology of what has happened.

How is this achieved? The contemporaneous note-taker should have access to all meetings to document all key decisions, noting who was there; what, if any, divergent views were expressed, and the agreed decision of the collective. As an aside, that there were divergent views is not a sign of weakness of the crisis response, in fact it is the opposite; it shows that those entrusted with responding to the crisis acted in a manner that was debated and appropriately considered.

Those who are more litigious of mind should consider how such work can be under the protection of legal professional privilege or its local jurisdictional equivalent.

Imagine if you will that the China Eastern pilots had not adopted an agreed crisis management response to the incident over Sydney in June 2017. One of the things that makes air travel tolerable is knowing that – should the worst happen – then there is an approach that will be enabled where everyone knows what to do and when.

This sense of comfort, of predictability, is that which a good crisis management plan should engender. Does yours?


About the Author:

Tom McLeod is considered one of the world’s leading Chief Audit Executives having been the Global Head of Internal Audit for Rio Tinto, one of the world’s largest mining companies and Head of Internal Audit and Fraud at one of Asia’s largest telecommunication companies. He now operates a boutique internal audit, corporate governance and fraud prevention consultancy called McLeod Governance which advises globally with Boards, Audit Committees and Chief Audit Executives.