Entries tagged with “disaster recovery”.


It is confirmed that Grimsvotn volcano in Iceland has erupted sending a plume of smoke and ash several thousand feet into the air.

In the past, this has not been a major issue, and air traffic was routed around a 120 nautical mile no fly zone. However, you may recall the challenges that many fliers to and from Europe encountered last year when another Icelandic volcano belched smoke and ash that was pushed to many of the major air hubs in Europe, slowing or stopping many flights and disrupting the flow of goods through the supply chain.

Hopefully the last time served as a wake up call to develop contingency plans to assure the smooth operation of your business.

One of the benefits of hind site in unexpected natural disasters is the opportunity to create a “lessons learned” document. By looking at the “pain points” that your organization encountered during the incident, you have the ability to develop contingency plans. 

What are some  common pain points?

  • Key personnel out of position due to transit delays
  • Inventory shortage levels due to interruption of supply chain
  • Increased costs due to spike in demand
  • Delayed deliveries
  • Decreased cash flow
  • Cancelled orders

I take a rather different approach to developing contingency plans by working backwards from the pain point (impact on the company) to the triggering effect.  So rather than looking at “Volcanic Activity in Iceland” as the starting point, I look at “delayed deliveries”. 

Why are there delays?  when brainstorming the reasons, think globally before locally.  

  • Limited shipping lanes
  • Lack of containers
  • Insufficient inventory
  • Lack of key components

Then ask Why?

Lack of containers -

  • Increase in demand
  • Not located where shipments are happening
  • Not being unloaded

Why?

Not being unloaded -

  • Customer using as free “warehousing space”
  • Dock strike at key receiving port
  • Unexpected inflow at key receiving point
  • Shipments aren’t moving  out of a shipping point

The why question asked 4 - 6 times will typically  drill down to a root cause, and root causes can be addressed by either establishing an alternative, or correcting the challenge to remove the obstacle.  They key is to not drill so deep that a plan must be generated for each possible reason, after all doesn’t a solution for delayed deliveries because of a volcano in Iceland require the same process steps as a dock worker’s strike in Los Angeles?  In both instances you would look at alternative transportation routes (perhaps moving the product from Frankfort to Madrid, depending on how the wind blows, or re-directing the container to Seattle from LA to get product into the country and stores quicker), or services (moving by ocean from Europe vs. air freight, or air freight from China to LA) and measure the cost and service impact against the cost and service impact for waiting out the obstacle.

The important idea here is to have a contingency plan for those items that may have a serious impact to your business, otherwise you may just erupt like Grimsvotn.

On October 13, the eyes of the world focused on a remote site in Chile where a group of miners finally began returning to the surface of the earth after 69 days of being confined underground due to a cave in.  It was a feel good moment that took our minds off the economy, negative campaigning, unemployment, and a host of other things to savor the moment.

A major part of the success of the operation goes to the careful assessment of various alternatives and the risks and rewards that were associated with each of the various options.  Even more important was the number and various disciplines the Chilean Government called on to assure a successful operation.    According to an article published in Business Insurance October 18, a wide variety of experts were called in to examine all aspects of the situation.  Experts from the insurance industry, NASA, the Chilean Submarine service, psychologists, nutritionists, engineers, and Doctors spent a considerable amount of time methodically reviewing the problem, and solutions.  The risk analysis continued on through the entire event and were not afraid to take the additional time to make sure the outcome was successful.

The article quotes Lane Bos, senior risk engineer and mining industry practice leader for Zurich  who indicated the planners “developed procedures and followed those procedures”.   The process was completed on the fly, but the key point here was they took the time to develop and then follow the procedures, continuously assessing the risk/reward for the action throughout the process.

Human beings are programed to react in certain ways when an event occurs that scares the heck out of us.  Our primal DNA coding pushes adrenaline, shuts down non essential body functions, and drives the mind to find a solution (have I experienced this type of a situation before?  What did I do and how did it work?  Please let me find the right solution before something bad happens!).  

I believe this is why we are so good a firefighting.  Fix it and store in the back of our minds in case we need it again quickly. 

In developing a risk management or business continuity/disaster recovery plan, you cannot plan for all types of emergencies.  In many cases you move from the 50 foot level to a 500 foot level for a base line and then provide alternatives for various scenarios (as an example evacuating the building as the base level, and different meeting points or exit strategies for fire, flood, gas leaks, tornado,etc.).   In developing the base line concept you also are adding to your experience and becoming familiar with the risk analysis process you develop the tools that help when the unexpected comes up. 

While the excellent article on the benefits of quality risk analysis is not currently available on Business Insurance, there is another excellent article on how Chile tapped NASA for assistance which is well worth the read and provides some insight into the thought process from an earlier time. 

An additional interesting PBS show from Nova chronicles the rescue and looks at some of the physical and psychological effects that helped these miners survive.  click here for further information and a preview of the show.

Back in 2007, the 9/11 commission established a number of recommendations for the public and private sector that would help both the government and private businesses be prepared for a disaster.   Title IX of the Implementing Recommendations of the 9/11 Commission Act of 2007 (the Act.) directed the Department of Homeland Security (DHS) to develop and implement a voluntary program that would accredit and certificate private businesses have established a program using a set of standard processes that will “enhance nationwide resilience in an all hazards environment”.  This program officially known as “The Voluntary Private Sector Preparedness Accreditation and Certification Program”.  Known as PS-Prep in the business world (which I think is a heck of a lot better than VOPSPAC that sounds more like a drug to reduce upper lip sweat caused by a government initiative), it is similar to the ISO standards many companies embrace to demonstrate to their customers and potential customers an adherence to process and procedure standards designed to maintain and improve quality products and services.

Similar to ISO9000, this program is not mandatory, and does not direct the specific processes and procedures that prepare a business for a disaster.  The program does provide three different standards to be used in establishing the program and measuring the successful implementation for accrediting and certifying the program is in place and in order.  The three standards selected were determined by DHS in June of 2009 after public input to meet the comprehensive needs in the event of a disaster and can be applied to the majority of businesses. 

They are:

  • ASIS International SPC.1-2009 Organizational Resilience: Security Preparedness, and Continuity Management System – Requirements with Guidance for use (2009 Edition). Available at no cost.
  • British Standards Institution 25999 (2007 Edition) – Business Continuity Management.(BS 25999:2006-1 Code of practice for business continuity management and BS 25999: 2007-2 Specification for business continuity management) The British Standards Institution is making both parts available for a reduced fee of $19.99 each.
  • National Fire Protection Association 1600-Standard on Disaster / Emergency Management and Business Continuity Programs, 2007 and 2010 editions. Available at no cost.

Embracing PS-Prep early may be a very good thing for several reasons.

  1. Utilizing the evaluation standards can identify any holes in your business continuity program and help to plug them.
  2. It differentiates you from your competition who are not participating.
  3. The focus on risk management from the board level due to SOX and other factors will be supported.
  4. While not mandatory, it can be a contributing factor in the securing business from government and other businesses during the bid process.
  5. If you do not have a continuity or disaster recovery program, it provides frame work for developing one.

For more information on PS-Prep, visit the FEMA site, or click here.