Japan’s horrific disaster teaches many things
25 March 2011
I’ve spent a lot of these last few weeks staying abreast of news from Japan. To me, this is more than a distant natural disaster because I lived in Japan, near Tokyo, for nearly three years while in high school.
I also lived outside San Francisco during the great quake in 1989 (and actually went through it in an electronics factory). My updates on what is happening aren’t simply coming from newcasts. They come from fellow high school alumni still living in Japan. I truly love Japan and its people, and having gone through an approximately 7.0 (6.9-7.1 depending on the scale used) earthquake, I can appreciate just how far beyond anyone’s imagination of disaster, the events in Japan have become.
At the same time, I see these events as a good teaching moment. Most of us will never experience a 9.0 quake followed by a tsunami and nuclear accident. However, we live in a world with a wide range of potential disasters that can cause safety issues and business interruption. While I question the concept of global warming and Armageddon, I don’t question the fact that weather and seismic events often run in cycles. We seem to be in the part of the cycle in both phenomena that generate the worst disasters. Over the past decade, I’ve heard the terms 100-year event more times than I care to count to describe issues which lead to business interruption.
This is an excellent time to review business continuity plans for two reasons. First, the events playing out in Japan provide a vivid illustration of the unanticipated chain reaction events that can accompany a large disaster and a plan review may generate some corrective actions that could be useful should your company’s worst case scenario occur. Second, as a result of the magnitude of business interruption the events in Japan will generate, it is likely that every major corporation will have sourcing teams reviewing their suppliers’ business continuity plans.
While definitely not all inclusive, here are some issues to consider during plan review:
1. The “big one” will eventually come and no matter how well you’ve planned you won’t have anticipated everything. It is impossible to plan for every contingency and is it not cost effective to try. The people of Japan have been planning for a major earthquake for decades. We trained for it when I was in high school in the 70s. And while there is no question that that planning saved many lives this time, it still did not address the total scope of this disaster. Every planning entity makes tradeoffs. The real question in evaluating a disaster/business continuity plan becomes what important issues have been missed?
One example that comes to mind from my quake experience was that my training was primarily focused on avoiding falling objects. The wave solder in the plant I was in splashed molten solder about three feet in either direction during the San Francisco quake. Fortunately, there was no second shift and the production floor was empty. If you are in a quake-prone area, does training move people far away from equipment that could become a hazard or simply guide them to doorways or under sturdy furniture? If you hold fire or tornado drills, do people move quickly or treat sirens as an exercise? Does every employee actually know what to do in an emergency or have you just assumed they read and memorize the material on the bulletin boards? What are the safe evacuation routes away from the facility in the event of flooding? In the event of severe cold is there a plan to monitor a closed facility for damage from frozen pipes? Is there offsite backup for all critical data and documentation? Is there an ability to move to an offsite “command center” in the event of loss of the facility. What strategic relationships are in place to facilitate resumption of operations in the event of a long-term or permanent facility loss such as a fire or flood?
2. Business interruptions may be the result of infrastructure failure. Japanese companies outside the quake zone are experiencing business interruptions as a result of power failures and business interruptions at critical suppliers. Once again, it is not economically feasible to build your own power plant and water supply system, and highly improbably that you could structure a supply chain with zero risk of interruption. So, planning should focus on building in flexibility to adjust rapidly to changing conditions. Inter-facility transfer plans or potential alliances to temporarily restage manufacturing outside of the impacted area are ways to address extended business interruption at your facility. Identification of regionally diverse alternate suppliers for critical components is a way to mitigate risk in the supply base.
3. Your company may survive the disaster but not the cleanup. Most companies try to insure themselves adequately for likely business interruption risks. However, insurance is not necessarily cash in hand. In a major disaster, claims adjustors may have difficulty even getting to the scene and then become backlogged. Even in a standalone disaster, such as a fire, insurers may contest claims or delay payments. What financing options are available in the event of business interruption and slow payment from insurers? When was the last time the insurance policy was checked to determine if your facility and equipment were adequately insured? If consigned inventory or equipment is in the facility, is it covered?
4. How will you communicate? In major disasters, phone service is often interrupted or overloaded. What secondary communications options are in place for keeping employees, customers and suppliers informed?
5. Attitude is everything. This is perhaps the area where we can learn most from what is going on in Japan. Japan has gone through one of the most horrific disasters ever. It’s freezing and there is limited power. Food and water are in short supply. Radiation has been released. Interruptions in communications systems make it difficult to know who is safe and who is still missing, and some bodies may never be found. Yet, there is no looting, mobbing in food or gas lines, or riots. Members of the Japan Ground Self Defense Force and rescue teams provided by many countries are working in conditions that may expose them to unsafe levels of radiation, further tsunamis or danger from aftershocks, yet they still work to help those in the quake zone. The acts of heroism and selflessness are too many to count. As someone who has lived in Japan, none of this is surprising. Self-sacrifice and respect for maintaining order and dignity are core values in this culture. It is hard to live in Japan and not also share those values, when everyone around you lives them 24/7. An important lesson to be learned here is that while you can’t change the culture of your company overnight, the way you handle yourself in a disaster will help dictate the attitudes of those around you.
In closing, I’d like to share something a fellow alumna posted on Facebook. It helps explain the values that the Japanese are currently displaying so well, and it also provides some good words to live by. Roberta was translating a public service announcement developed by AC Japan (Advertising Council Japan). One's "kokoro" (spirit) cannot be seen by anyone, but "kokoro-zukai" (compassion) can be. "Omoi" (thoughts) cannot be seen by anyone, but "omoiyari" (thoughtfulness) can be seen by everyone.
While I personally think the people of Japan will re-build faster than the world will think is possible, I also realize that pain caused by this event will not go away nearly as quickly. The people of Japan will not ask for it, but gestures of kokoro-zukai and omoiyari will be welcome for a long time to come.
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