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Back to Facility Manager
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by Joe DesPlaines The plain truth about most organizations’ crisis response plans is that they drop the ball before crossing their goal line. Our business involves conducting hundreds of Loss Prevention and Insurability Audits for clients ranging from high profile teams, venues, and events to local family entertainment centers. As part of these evaluations, we have reviewed a variety of crisis management and/or emergency response plans and one issue is consistent: the vast majority of organizations have response plans that end with evacuation, ignoring critical risk management issues that can have a dramatic effect on business continuity. In reviewing our experience, five issues have surfaced that have an impact on business continuity and should be considered part of a comprehensive risk management plan:
Risk Management Is Not Insurance A risk management program that emphasizes insurance as the primary risk management tool is destined for disappointment. Despite the lessons learned from the September 11th terrorist attacks, this practice continues. Risk managers must remember that the impact of a business crisis may extend well beyond the event and may result in business continuity issues not addressed by insurance. The true cost of any large loss is generally four to five times the actual claim paid. A large loss will negatively affect good will, reputation, and future earnings. It is far better to prevent a loss, or have steps in place to mitigate loss. An over-reliance on insurance discourages important initiatives to improve internal business practices required to prevent losses from occurring. Today’s business managers recognize that insurance must be part of a comprehensive risk management strategy. Managers now recognize that risk management requires a strategic commitment at the highest levels of an organization. Risk — that is, threats to an organization’s strategic objectives — must be treated as tangible liabilities.
Crisis Media Relations Preparation
Little or No Assistance for Crisis Survivors,
A significant trend over the past decade has been the increase in telephone inquiries that are directed toward organizations that have experienced a crisis involving injuries and loss of life. Media attention to these events has generated public interest and the resulting calls to an organization can number in the thousands. This has been clearly documented following commercial aviation accidents, where it is not unusual for an airline to receive 25,000 calls or more following a catastrophic accident, from family and friends of victims, the media, those wanting to help or contribute to victim families financially, and curiosity seekers. This same practice has also been seen following natural disasters, acts of workplace violence and terrorist attacks. Most organizations do not have the technology or trained staff to handle the volume and nature of these calls; yet, not responding to telephone inquiries can cause an organization to appear uncaring and/or indifferent. Contracting with an experienced crisis call center that can be activated following a mass casualty event is a vital part of a crisis response plan. Organizations must realize that a crisis response does not end with resolution of the immediate crisis. In today’s world, an organization that is the victim of an attack can lose the public’s sympathy by being unprepared or ineffective in its response to victims and their families. The level of compassion and support demonstrated by an organization following a crisis contributes to business continuity efforts.
Employee Assistance Most employees closely identify with their employer; after all, the average person spends more than half their waking hours on the job. When a crisis occurs, particularly a crisis that involves loss of life, it can have a profound effect on employees. Further, employees who either witness injuries or who have friends injured will be affected in more traumatic ways. The truth is that most employees have nothing in their life experience to prepare them for a sudden and violent critical event. Recovering from such an event can require structured programs of counseling and support. Employees are an organization’s most valuable asset, and more attention should be given in planning to ensure the ongoing effective functioning of organizations’ human resource following a crisis.
Crisis Recovery and Business Continuity - Different But Both Necessary
Both tasks are extremely important. Organizations need to have crisis recovery plans in place in order to deal with unexpected disasters. Crisis recovery involves a variety of functions from securing a building to crisis media relations, and all the component parts are necessary to effectively deal with a crisis and resume normal operations. Business continuity takes a much broader view and focuses on practices to ensure ongoing operational functioning. It involves understanding critical business functions, knowing where weaknesses exist, and having tested contingency plans for maintaining those functions during and after crisis recovery. Business continuity planning has become sophisticated and involves a full continuum of tasks. Given current world events, having a comprehensive business continuity plan in place that includes disaster recovery plans is essential for assuring employees, customers, shareholders, and other constituents of an organization’s ability to continue long after a crisis has occurred. While evacuation plans are a necessary part of any business recovery and business continuity effort, response to a crisis does not end with evacuation. Understanding the long-term consequences of a crisis is the first step to organizational planning for surviving a crisis, and successfully continuing operations into the future. It is obvious that crisis response involves many components, including victim and employee assistance, media relations, and developing business continuity and emergency response strategy. It is imperative that organizations plan for all of them and not find themselves stranded at the one-yard line and out of time. Joe DesPlaines is president and chief operating officer of American Specialty Risk Management Services LLC. |
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© 2004-2005
International Association of Assembly Managers |
Organizations
must anticipate and attend to victim and family needs and provide whatever
support is necessary to assist victims and their families through the
immediate crisis. At the same time, organizations that have experienced a
crisis must demonstrate their concern and compassion through communication
with the media to the public.