Planning for Business Continuity in the Face of the H1N1 Pandemic

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Just over half of businesses in the U.S. (52%) believe there will be a more widespread and more severe outbreak of novel influenza A (H1N1) in the fall. If such an outbreak does occur, 84% of firms are concerned that it will negatively affect their business.

This is an excerpt from a study conducted by Harvard's School of Public Health.

With the potential for a “Fall Surge” with the H1N1 Influenza A on the horizon, businesses should plan for the potential interruption of critical services from outside vendors and contractors. The CDC predicts that as many as 40% of the workforce could be affected by the virus at its peak. 25% of the workforce will take 5 to 8 days off during a 3-month period of the flu season. Historically the second and third waves can be more severe than the first. Even though H1N1 appears mild in its present form, it can quickly mutate into a more lethal virus. Lethality aside, to individuals and employers the virus still has the potential to cause serious interruptions and shortages in the basic necessities of life and critical business materials.

Many experts have indicated that the second wave will most likely occur when schools begin classes in September. Unfortunately the CDC has recommended that schools send children home with masks and keep the school open. Parents will naturally need to remain at home if children are ill. Approximately 1/5 of the U.S. population attends or works in schools. (U.S. Dept of Ed, 1999). The flu can also spread quickly in densely populated urban areas. Businesses located in urban areas will need to take extra precautions in protecting their workforce and increasing stocks of critical items prior to the fall outbreak. It has been well documented that individuals are contagious for at least 1 day before they begin to exhibit symptoms and 5 days after they become ill. For this reason it would seem almost impossible to limit the spread of the virus once in the community. There is also a lack of emergency hospitals. In 1918 the U.S. had many emergency hospitals; most of them became permanent after the pandemic. Now there is very little surplus capacity. (The Great Influenza, John M. Barry) Communities will have to rely on government entities to provide emergency facilities to care for the seriously ill.

Imagine if the pandemic intensifies and deaths are reported on in increasing numbers, many businesses may have to shut down due to fear in the community. Obviously this could have an incredible impact on a business that uses “just-in-time” (JIT) practices. Even if a business does not utilize JIT, many major manufacturers and companies that provide goods do. There is also the potential for widespread food shortages as deliveries can be impacted by rail shutdowns, port closings, trucking, etc. As productivity has increased with JIT, inventories and redundant labor have disappeared. The daily transport and delivery of products also increases the spread of the disease as delivery personnel become a potential conduit for the virus as they go from business to business.

Businesses may instruct employees to telecommute and work from home, this increase in internet and phone traffic can put a strain on the system and severely limit productivity. If and when communication providers are hit by influenza, services may be curtailed.

Weather may also play an important role in business continuity, especially in the Northeast and Central US. If the winter is severe, as it has been determined that we have enter a 10 to 20 year “cooling period” the workforce may be affected to an unprecedented level. Deliveries of fuel oil could be delayed, electricity demands may escalate, and illness may increase. If utilities lose significant numbers of employees, buildings may be forced to close.

As individuals are out of work or businesses are closed, some companies may be impacted more severely than others. Theaters, restaurants, malls, and airlines are just a few that come to mind. Now think of all of the supporting vendors and companies that provide goods to business. What would happen is gasoline deliveries are interrupted for just a few days, food deliveries are stopped to grocers, if banks have to close? Whichever region of the country is impacted first, it will set off a cascade effect that will impact businesses well in advance of the actual virus infecting individuals.

Some Pandemic Planning Suggestions

Develop a plan and organizational structure with redundancy that is at least 3 people deep.

Indicate what scenarios or critical issues will trigger a response.

Distribute the plan to all employees and review critical issues.

Direct employees to credible resources such as CDC and WHO websites.

Determine which employees are critical and which are essential.

Determine if staffing can be covered by part-time employees. Many companies have not developed plans for absenteeism rates of 30% or more.

Develop a strategy that allows you to communicate with critical staff even without phones or internet. (Example: Set up a predetermined meeting place and time if you cannot reach someone by phone or email)

Communication should be proactive and not wait until an emergency has already occurred.

Prepare statements in advance that can be posted on company website or made readily available to all concerned parties for varying degrees of an emergency situation.

Review health issues with insurance provider.

Contact city or community officials and discuss your concerns with them.

Businesses need to be aware of how local, state, and federal authorities may impact their business functions.

Prepare a Memo of Understanding agreement with vendors and service providers to ensure that there are no misunderstandings of priorities during the pandemic emergency.

Identify any recent personnel changes and review plan with them as required.

Have employees coordinate a buddy system for communication and carpooling plan.

How will police protection be affected in the event of quarantine?

Allow for the potentiality of community-wide quarantines and plan for an alternative.

Arrange partnerships with other businesses that you have a relationship with to pool resources. (Security, deliveries, clerical, customer service, etc.)

In case of a pandemic disaster, make sure employees can work autonomously.

Contact customers and indicate your response in case of an emergency.

Consider an alternative worksite if transportation is compromised, security concerns, or building is closed.

Determine which IT functions can be handled remotely or automatically.

Determine what issues will necessitate a system freeze or limit changes to the system.

Consider creating press releases or company announcements ahead of time for different scenarios.

Determine what legal issues may arise for your business.

Determine how long you can maintain emergency systems and plan.

Have some apparatus or method for restructuring or altering the plan to account for unforeseen events. (Contact plan authors)

Determine who will take a leadership role in the event of death or prolonged illness.

State and Federal compliance issues will still need to be followed as long as the business is operating. (Sarbanes-Oxley)

Test all back up systems; power, communication, databases, etc.

Develop alternative methods to obtain critical goods and services in the event of widespread shortages.

Investigate online transaction and self-service options for customers and partners.

Determine if the business will focus on maintaining current customers. Compile a list of the most important customers.

Determine if security will be provided if the building is closed. (Leased space)

Determine the fastest route to medical facilities.

Determine if remote offices will remain open or if some business functions can be conducted there.

Identify who could benefit from Personal Protective Equipment (PPE) and obtain sufficient stock piles.

Prepare for business start up at the end of the emergency. Demand surge will likely occur once the disease has subsided and fear has abated.

Develop a recovery plan so that all business units can be back to normal operation within a predetermined timeframe.

Review plan and test.

Four-Fifths of Businesses Foresee Severe Problems Maintaining Operations If Significant H1N1 Flu Outbreak


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