The three phases of crisis management are associated with the incubation stage of the crisis, the onset of the crisis and the aftermath that follows the crisis. In these three stages, the crisis is managed through the use of effective decision making, learning and employing of knowledge to resolve the issues (Boin et al, 2005).
In the incubation stage for the Northern Rock Crisis, the organization culture played a main role along with the development of high short terms costs in the face of the US mortgage market crisis of sub prime mortgages. The development and the production of the products and services was limited to focus on the market demands while the contingency planning was also insufficient s the stress tests were not conducted and the liquidity crisis was not forecasted or predicted. Additionally the role of the stakeholders was not taken into account in the communication and the decision making process.