Archive for October, 2009

The world’s largest insurance broker has announced a new product.  AON Corp has established a new policy specifically for companies that are concerned about losses from shut down and interruption due to the H1N1 flu (aka Swine flu).  In an e-mail statement to Crain’s Chicago Business, the organization announced a stand alone policy that will provide coverage for lost wages, fixed costs and extra expenses when associated with this flu virus. 

Most insurance providers offerring business continuity policies have excluded coverage for buildings closed due to the flu.   According to the article in Crain’s,  pricing information and terms and conditions were not provided.

With the H1N1 virus getting so much attention these days, and President Obama declaring a national emergency over this potential pandemic, it is wise to consider options to protect your company, and this specific insurance coverage is one of those options. 

Points to consider with this policy would be the terms and exclusions established by the policy, the coverage that is provided, and naturally the cost of the policy.   Additionally I believe an understanding of the nature of your business and the impact to your business if you were not able to access your physical location are another key component.   In many cases companies have established alternative sites, and work options as part of a larger continuity program (You have developed some basic contingency and/or recover plan I hope).

Last year, there were instances of the government closing sections of a city down because of flu fears, and the article hints this would be one of the items that would be covered.  I would assume that this would also cover costs in the event the building management closed the facility due to the flu outbreak. 

Based on this best guess of coverage, folks in the retail sector would be hardest hit and, depending on the cost, could provide economic relief.  Service industries could also be affected because of the locations of many offices in major cities.

If this type of insurance coverage is important to you, contact your insurance broker or AON directly for additional information and costs. 

If you haven’t developed your pandemic continuity plan, a good place to start is by reviewing our previous posting  on preparing for the pandemic published earlier this year.

If there wasn’t enough pressure put on the supply chain, Business Week highlighted another issue.  In a article entitled “Beware the Bottlenecks“  Peter Coy highlights the potential for bump in prices and increased inflation because of bottlenecks and issues within the supply chain.   It’s an interesting article that outlines a scenario for increased inflation because of increased prices that occur when capacity cannot meet the demands.  Coy pointed out that both Ford and GM had shortages of selected vehicles (Escape and Cobalt) that were related to parts and steel needed to make the cars. 

Additionally an article in the same issue “What’s Holding Back Tech” by Steve Hamm reported that Nokia indicated that some of the $832 million  third-quarter loss was due to shortages of handset components (you can’t sell what you don’t have).  The article pointed out that there are spot shortages in a wide range of components because of lowered production during the recession.

This points to another issue that many companies will be facing during the economic recovery.   How do you forecast for the recovery, especially if your organization has no prior history with upticks from a slowdown.  How do you know when to switch from survival mode to growth mode, and better still, how do you make sure your suppliers are moving at the same rate of speed as you are?

Good communication and a watchful eye on your industry or other industries which are leading indicators for you are a good source.  Look to see who’s ramping up production for component parts.  Quiz your customers to see what the word on the street is,  Is there an actual increase in sales?  Or are people laying in stock for an expected strong holiday season?  Are your supplier’s supplier’s increasing production? 

Now is the time to gather information to make informed decisions, and the more information, the better.

This is a divergence from the normal focus of the site.  But in a broader sense, this is about insuring our future.

In conjunction with blog action day, an annual event where bloggers from around the world focus on one particular topic to change the conversation on the web to a specific topic.  This years topic, Climate Change.

Living in the Chicago-land area, it is easy to take for granted the steps government and businesses have taken to improve environmental quality.  The city has promoted this through a focus on environmentally friendly buildings with green roof tops, wind turbines (we are known as the windy city), recycling programs, an excellent mass transit system, and an overall focus on what we as individuals and companies can do to reduce our carbon footprint.

Did you know that buildings typically contribute 40% of a country’s total CO2 emissions?  This was a surprising figure to me, but when you factor in the heating, cooling, lighting, energy use for office equipment, servers, elevators, etc. it really does make sense.  In light of this, many companies are looking to reduce energy consumption by 20% over the next 5 years.  

The road to reduction takes many paths, including constructing, converting or relocating to green buildings.  According to the National Real Estate and Hotel Practice Group of the Willis Group, approximately 700 buildings have achieved green building certification with 5000 more waiting for certification. 

John Schinter, President Energy and Sustainability Services for Jones Lang LaSalle  indicated that interest in sustainable buildings from their corporate client base is doubling every year.  In many cases this is driven by the desire to reduce energy costs and greenhouse gases.

One of the interesting benefits from the move to “green buildings” is that studies have shown a reduction in absenteeism and in increase in productivity among people who work in environmentally improved buildings.

So what can you do to help reduce both your and your company’s carbon footprint?  The key idea is to be more aware of how you use and potentially waste energy. 

  • Add environmental impact into the mix during the decision making process
  • Turn off your task in the office when you leave for lunch and at the end of the day
  • Instead of using the car, walk to appointments or complete errands, or combine errands into one trip
  • If you don’t have a recycling program at work, start one, it reduces waste and makes everyone feel better
  • Telecommute, car pool or use public transportation
  • In the winter, turn down the thermostat, sweaters are a great way of keeping warm without warming the air around you
  • In the summer, turn the thermostat up and use a fan to circulate air (just be sure to turn the fan off when not in the room).
  • Recycle the coffee grounds from the office into your garden, it keeps it out of the landfill and makes the veggies happy
  • Turn off the computer when not in use
  • Plant a tree, grow a garden, plant flowers in pots or in the yard
  • Don’t print the e-mail, blog posting or other information, keep it on file in your computer
  • Use your own coffee cup, it helps individualize you and reduces energy used in making throw away cups
  • Recycle, Recycle, Recycle.

For more suggestions on saving energy, visit the US Department of Energy Energy Saving Tips site.   Thanks for taking part in helping improve our environment and reduce greenhouse gases.