9/11. Katrina. Virginia Tech.. Almost every disaster, incident of school/workplace violence and act of terrorism was preceded by warning signals

These are not the worst disasters you will see.

9/11. Katrina. Virginia Tech.

The worst disaster you will see is the one that happens to your business.

TIMING

NORTHERN ILLINOIS UNIVERSITY

Almost every disaster, incident of school/workplace violence and act of

terrorism was preceded by warning signals.

”PREDICTABLE SURPRISES”

CRISIS MANAGEMENT: FIRST RESPONSE

Pastoral setting: • Physically-intact campus • Traumatized community

Media circus • 324 Media outlets • 140 Satellite trucks• $4 million by major network in first week

CRISIS COMMUNICATIONS RESPONSE

Transparency Framing messages Controlled accessibility

• Established call center to broker access and provide information

• Signage on campus buildings when classes resumed

Metrics Timeline

CRISIS MANAGEMENT: THE MEDIA

TIMELINE

Initial shootings in West Amber-Johnston Hall• Lovers’ triangle • Absence of students to interview

Immediate arrest of ‘suspect’ • Boyfriend left “in a hurry”• Guns found in truck

Norris Hall response • Nine minutes from entry to end of shootings

THE FIRST 24 HOURS

WRONG

Time alters our perception of riskIt can’t happen here.It can’t happen to me. It won’t be so bad. I’m smarter and better prepared.

WHY WE DISCOUNT RISK

DISASTER DENIAL

“There cannot be a crisis next week. My schedule is already full.”

Henry Kissinger

WHY CONTINUITY PLANNING?

Business environment at greater risk Natural disasters Pandemic threat Terrorism Economy at risk

Governance requirements Disclosure issues Regulatory guidelines Sarbanes-Oxley Looming litigation

DISASTER EXPOSURE

Almost 2/3 of companies that suffered a disaster experienced lost business

STATISTICS OF FAILURE

STATISTICS OF FAILURE

OF BUSINESSES WILL LOSE TO OF THEIR SHAREHOLDER VALUE IN 5 YEARS AS A RESULT OF A DISASTER OR CRISIS.

OF CONTINUITY PLANS HAVE NEVER BEEN TESTED.

DISASTERS OCCUR ANNUALLY IN THE U.S.

OF BUSINESSES STRUCK BY A DISASTER NEVER REOPEN, AND OF THOSE THAT REOPEN CLOSE IN TWO YEARS.

83% 20% 30%

80%70,000+

40%25%

DISASTER DENIAL

TODAY

EVERYTHING IS FORESEEABLE

VULNERABILITIES Extreme Heat Fires Floods Global Warming Hazardous Materials

Hurricanes Landslides Multi-Hazard Nuclear

EarthquakesPandemic

Power Outages Thunderstorms

Wildfires Winter Storms Workplace Violence Dam Safety Earthquakes

Terrorism TsunamisTornadoes

Extreme Heat Floods Global Warming Hazardous Materials

Hurricanes Nuclear Pandemic Terrorism

FiresPower OutagesLandslides

Thunderstorms Tsunamis Volcanoes Winter Storms

Earthquakes Fires Global Warming Landslides

Tornadoes

FloodsWildfires

Pandemic Power Outages ThunderstormsTerrorism

Hurricanes

Nuclear

VULNERABILITY ANALYSIS

WARNINGHIGH IMPACT / LOW

CERTAINTY

DANGER HIGH IMPACT / HIGH

CERTAINTY

NORMAL OPERATIONS

AWARENESS & CONTINGENCY PLANNING

CORPORATE GOVERNANCE & PREACTION PLAN

CERTAINTY

IMPACT

THE DISASTER ENVIRONMENT

YOUR COMPANY

Employees

Family & Friends

Work & School

Critical Suppliers

Customers

Stakeholders

DISASTER

DISASTER

IN/OUT/ACROSS ANALYSIS• FINANCIAL • OPERATIONAL

• EXTERNAL• STRATEGIC

PROCESSES WITHIN

EACH ENTITY

PROCESSES THAT

MOVE IN & OUT OF ENTITIES

FIVE MOST COMMON FAILURES

CONTROL CRITICAL SUPPLY CHAINSTRAIN EMPLOYEES FOR BOTH WORK & HOME IDENTIFY ALL THREATS AND / OR RISKSCONDUCT EXERCISES AND UPDATE PLAN DEVELOP CRISIS COMMUNICATIONS PLAN

LIABILITIES

LEGAL

OSHA MEDICAL PRIVACY

HR BENEFITS

DISCRIMINATION

FORCE MAJEUR

E

FAILURE TO PLAN

GOVERNANCE

INSURANCE

NEGLIGENCE

MORE THAN AN IT ISSUE

Every Crisis is a Human Crisis.

SYSTEMS DO NOT PROTECT PEOPLE

SERVERS CANNOT INITIATE ACTION

NETWORKS WILL NOT BE HELD

ACCOUNTABLE

NO PEOPLE → NO RECOVERYEvery Crisis is a Human Crisis.

RULE 1, 2, 3

2+ backups for • Critical tasks

and business functions

• Software and data exchange

File a written record of each

backup’s contact and access data

Documentation should be updated

every 6 months

Disasters result in high absenteeism: Train 3 employees for each critical task

CRISIS COMMUNICATIONS PLAN

Predict • Who is the audience?• What are their concerns?

Plan

• Tailor message, messenger, and media

• Format to the stakeholder

Perform • Focus on the 3 key messages

WHY NOW?

Business environment is less forgiving

Risk management is usually internal, but external risks have not been addressed

Systemic risks have not been a focus – how to survive a major industry-wide event

WHAT CONSTITUTES A PANDEMIC?

Highly virulent

organism

Lack of human

immunity

Easily transmitted human to human

MODES OF TRANSMISSION

Contact TransmissionDirect Contact

Indirect Contact

Droplet Transmission

Airborne Transmission

P 1 P 2

P 1 P 3

P 1 P 2

P 1 P 2

29

Index Case

ODYSSEY OF SARS TRANSMISSION

3 hour Flight; Hong Kong to Beijing, March 15, 200318 Cases4 Deaths

Crew Member

Probable Case

TEST EXERCISE

Pandemic Scenario

TEST EXERCISE OBJECTIVES

Validate and understand the monitoring process for a pandemic situation

Understand the tracking method for global health status.

Understand your company Pandemic phases and triggers.

Understand the roles and responsibilities of monitoring.(Travel, health of employees, closings, status of the business, etc…)

Validate the process for tracking employee absenteeism at all locations.

TEST EXERCISE OBJECTIVES

Identify the impact of a pandemic on employees and business per phase

Determine company response to the health and safety of employees and families.

Discuss the employee response to a pandemic. Discuss customer response to a pandemic.

TEST EXERCISE OBJECTIVES Understand the communication process and

content throughout the phases Communication to employees on preparedness (content,

frequency, method, etc.) Validate insurance coverage and claims process. Discuss and understand new and updated HR policies. Determine critical supplier and vendor communication pre,

during, and post pandemic. Deliver a media statement addressing investor relations and

customers. Discuss alternate methods of communicating (video

conferencing, webcast, etc..)

TEST EXERCISE OBJECTIVES Determine how to adjust the business and invoke

workforce recovery strategies Determine critical business functions and staffing

requirements. Discuss current and future telework policy and

capability. Determine the action to be taken.

TEST EXERCISE OBJECTIVES Define opportunities to improve the Crisis

Management and Pandemic plans Identify gaps and issues. Identify improvements to your Crisis Management and

Pandemic plans.

ASSUMPTIONS AND INSTRUCTIONS

Respond based on your understanding of current plans Make your best decision based on situations as given Draw upon your own understanding of how well college

departments, government agencies and law enforcement work together in emergencies

Decisions do not reflect your school’s position on any given issue

State and federal responders are initiating their own plans and are not completely available

There is no predetermined solution to this exercise

Update

PHASE 1: SUSTAINED HUMAN-TO-HUMAN

TRANSMISSIONAn H5N1 avian flu epidemic starts sickening and killing people in China, where your company does not have any operations, but does have supply chain sources. The medical community fears that the disease will spread to other continents and says that anyone who has been to China in the past three weeks could be a carrier. As a precautionary measure, your company considers asking employees who have traveled to China within the past three weeks not to return to work until they have seen a doctor. Your company also considers having corporate security at the front door ask every visitor whether he or she has been to China in the past three weeks.

PHASE 1: WEEKS 1-4SITUATION(S)The Chinese Ministry of Health reported that public health officials are investigating a hospital-associated outbreak of H5N1 influenza. The outbreak appears to be the result of person-to-person transmissionParts of Europe have confirmed a dozen cases of avian flu

WHO declares a Phase 5 Pandemic Alert

Breaking News Breaking News Breaking NewsBreaking News Breaking News Breaking News

The Center for Disease Control (CDC) issues a Travel Health Warning for those traveling to and from affected areasEmployees who have been traveling overseas are required to return home, but there is no indication that major airports in the U.S. may closeSome of the executives returning from overseas have not been feeling well but they assume that it is because of the change in time zones

PHASE 1 – EXERCISE OBJECTIVES

Identify threat level: • What do you know?• Are you concerned?• If so, about what? • What is your plan?

Update

PHASE 2:OUTBREAK IN THE U.S.

A few people in your region are diagnosed with the disease, and the absentee rate at schools rises. Employee absenteeism is on the rise. Your company notices a decrease in overall sales. Movement of goods is limited in certain regions of the United States. Enough people are absent that your company struggles to, maintain systems, stores open, manage call centers, process orders and pay bills.

PHASE 2: WEEKS 5-8


SITUATION(S)Suspected cases have been reported in Atlanta, Chicago, Philadelphia, Boston and Washington, DC, with twenty deathsEmployees start calling in sick, but it's not clear whether they are ill or afraid of going out in public

Many local schools and Universities announce they are closing or suspending classes —except for essential personnel— according to their pandemic influenza emergency plan

State officials are encouraging schools, businesses, and organizations to cancel all public group activities such as athletic events, meetings and other non-essential group functions

PHASE 2: WEEKS 5-8 CONT’D SITUATION(S)

Several deaths around the state are being investigated with a possible H5N1 cause

Random incidents of employees in Philadelphia refusing to work with Asian co-workers, is reported

Businesses are reporting increased employee absenteeism and some of employees are requesting approval to work-at-home

Businesses are reporting increased employee absenteeism and some of employees are requesting approval to work-at-home

U.S. hospitals are on alert for new flu cases

PHASE 2 – EXERCISE OBJECTIVES Identify threat level:

• What Changed• What do you know?• Are you concerned? • If so, about what?• What is your plan?

Update

PHASE 3: CLOSING OF HEADQUARTERS &

LOCATIONSThe disease spreads, and absentee rates shoot up to almost 50 percent. Some employees are sick or caring for sick family members. Employees are asking your company to provide vaccinations and masks; even though the medical community says those precautions may not be effective. Critical functions are not getting done. Managers consider letting crucial staff volunteer for a lockdown. They also consider rerouting work to another location or calling in retired workers to help out. Some employees believe co-employees in next cubicle at headquarters have been exposed, but won’t self disclose. Your company is considering closing at least 75 % of their locations and laying off a significant number of employees.

PHASE 3: WEEKS 8-9


SITUATION(S)WHO declares a Phase 6 Pandemic Alert

National media are reporting hundreds of avian flu cases in nearly all parts of the country. To date, the State Health Department has reported more than 50 confirmed cases in the state with 20 deaths

Businesses are reporting that as many as 60% of all employees are refusing to return to work, either because of self-quarantine, caring for young children, or ill family members

Your local hospitals are reporting that they are besieged with calls and people who are worried about their symptoms. Every emergency room is at full capacity or worse

PHASE 3: WEEKS 8-9 CONT’D SITUATION(S)

There is a concentrated outbreak at a major university

Shipments of food and other essentials are delayed because the national transportation network has been decimated by absenteeism

Some businesses close

Essential personnel are ordered to show up for work; only 60% report

Human Resources is identifying those employees who may have recovered from the flu in order to re-supply the numbers of essential personnel

Mandated closure of public school system


Identify threat level: • What changed?• What do you know?• Are you concerned? • If so, about what?• What is your plan?

Update

PHASE 4:BUSINESS CONTINUITY AND RECOVERY

There is a rapid decline in the number of new cases, but many employees are still leery of returning to work.

PHASE 4: WEEKS 10-12


SITUATION(S)

Hospitals throughout the state are reporting a rapid decline in the number of new cases

Local schools decide to re-open classes, but attendance levels are down 30+%

The local news reports that nearly 100,000 people have died in your state and over 1,500,000 nationwide

The President goes on national television to announce that the CDC and the WHO have concluded that the First Wave is over, but warns that a Second Wave could appear in two to three months


What changed? What are the greatest concerns? Are the events concluded? What consequences need to be addressed? What is your most important message?

TEST EXERCISE DEBRIEF

1. Were the predetermined elements of your Crisis Management and Pandemic Plan tested?

2. Did the exercise reveal any weaknesses in your pandemic planning and readiness?

3. What tasks must you complete to improve preparedness, planning or response?

THE 9/11 COMMISSION

“Preparedness is not a luxury; it is a cost of doing business.”

DISASTER DUE DILIGENCE

A recent study of 1200 CFOs in 79 countries indicated:

62% of businesses with over $5 billion in revenue encountered a major risk event

42% of these businesses were not prepared

DISASTER DUE DILIGENCE

PREDICT. PLAN. PERFORM. ™

If you had to respond now, are you ready?

Documents

9/11. Katrina. Virginia Tech.. Almost every disaster, incident of school/workplace violence and act of terrorism was preceded by warning signals