While risk managers might be tempted to ignore the potential disruption associated with a world-wide avian flu pandemic, they are paid to think about the unthinkable. So today as a public service, the Insider hopes to stimulate some disaster planning among our readers. Even with the prospect of millions dying in a few days or weeks, businesses need contingency plans, no matter how unrealistic they may seem. In an article in the New York Times (registration required), Patricia Olsen outlines the steps that small businesses can take in preparing for a possible avian flu pandemic.
“Many people plan for the worst-case scenario, but that’s not the way to go about it,” said Donna R. Childs, co-author of “Contingency Planning and Disaster Recovery: A Small Business Guide” (John Wiley & Sons, 2002). “Take incremental steps and build on that.” The concept of incremental steps is a good one. The difficulty, of course, is determining which small steps might actually mitigate the impact of a really big disaster such as an avian flu outbreak.
Advice From the Ivory Tower
The article quotes Peter Morici, an economist and professor of business at the University of Maryland: “Besides backing up vital records and functions at a secondary location [good advice], it is a good idea for small businesses to start networking to find a source of replacement workers.” To which I say, yeah, right. These days it’s hard enough to have a workforce, let alone a shadow back up crew.
In addition, Morici suggests that if a business’s area is quarantined, but its customers are in areas that are not, then it might pay to move to another location. Again, the professor is probably right, but I’m not sure how practical it is to pack up and move under the ominous shadow of a flu outbreak.
One immediate – and very doable – step is to secure business-interruption insurance to cover lost income during a shut down. This insurance is generally available at an incremental cost to current commercial insurance. It is also a good idea to cross-train employees and identify potential new suppliers (although finding new suppliers is akin to finding a shadow work crew: good idea, but terribly difficult under the circumstances).
We’re From the Government…
The Centers for Disease Control and Prevention (CDC) has developed a handy checklist (PDF) that walks small businesses through the process for developing a pandemic preparation plan. (NOTE: The Times article has the wrong links.) Some of the suggestions are practical: stockpile paper masks, disinfectants and related hygienic supplies. Develop plans that involve less face-to-face contact: eliminate shared workstations, avoid mass meetings, encourage telecommuting.
It’s when the pandemic hits that the suggestions become more problemmatic. To prevent influenza spread at the worksite, the checklist recommends policies to promote respitory hygiene, cough etiquette and “prompt exclusion of people with flu symptoms.” Does this mean having guards (presumably wearing masks) escort anyone with symptoms off the premises? Will companies need “cough police” to enforce good hygiene? Will small businesses be able to differentiate between avian flu symptoms and an ordinary cold or hay fever?
I am all for being prepared. But as all risk managers know, there is much in the terrifying prospect of a flu pandemic that exceeds our abilities to plan. We can dutifully go through our checklists. We can look around for additional suppliers and even replacement employees. But it’s hard to envision these “incremental steps” having a significant impact on our ability to sustain business operations. It’s comparable to Katrina: you can board up the windows. You can move valuables to the attic. But if the waters rise above your roof, your preparations will not amount to much.
