It's not so much that organizations, per se, are reluctant to accept that they are in a crisis situation. It has more to do with the core perceptions of those in the organization who can define when a situation constitutes a crisis—those in an organization's decision-making loop. There is no crisis if "I've got everything under control." Often, employees who are not in the decision-making loop have concluded that a crisis exists long before the decision-makers come to the same conclusion.
Assuming that some kind of "control limits" have been devised, i.e., measurements of various aspects of operations are being made against a particular set of standards, in the minds of the decision-makers, a crisis doesn't exist as long as the measurements either remain within the control limits or do not exhibit a trend toward one of the limits. Obviously, the perceptions depend upon whether the control limits have been properly established, maintained and timely observed.
Low level employees work where 'the rubber meets the road." Decision-makers usually don't work there. They depend upon getting necessary information through the channels established for that. Often, there is excessive lag-time in the process and the message can become garbled.
The real truth is: (1) Crises usually start small and are "below the radar horizon." At that point, the situations don’t look like they will become crises. They are looked at in isolation—out of context. This makes what is happening look like an isolated case, rather than the beginnings of a pattern, and therefore, not a problem that needs immediate attention. As a result, when the problem does "pop up onto the radar," i.e., it gets big enough to “get in your face,” it’s easy for the decision-makers to have the impression that the the problem has appeared suddenly, without warning, almost "overnight." Cognitive dissonance has a strong hand in this. (2) Crises usually occur when one or more basic principles has been totally overlooked or, if not totally overlooked, under-appreciated.
