Industry enhances systems to better coordinate goods, services during disasters.
By Geoff Whiting
When disaster strikes, it’s only natural for companies to want to help.
However, this may be easier said than done especially if communications, electrical power, and transportation infrastructure are severely impaired. Sometimes a rush of supplies to a disaster site may end up further compounding problems on the ground.
This was the lesson learned by a group of shippers, logistics services providers and carriers during Hurricane Katrina in 2005, and which led them to create the American Logistics Aid Network (ALAN) shortly thereafter.
ALAN has since brought together numerous industry professionals who use their supply chain expertise and other resources to support humanitarian efforts in the aftermath of disasters, both domestically and abroad.
“We all think that it happens to someone else,” said John “Jock” Menzies, president of ALAN, in an interview. “However, you’re going to be seeing much more pressure in the business community to be able to demonstrate resiliency” not just for disaster victims but resuscitating their own operations as soon as possible.
“There’s a healthy dose of self-interest in terms of being able to survive (a disaster) yourself and being able to stand up for your local community and marketplace,” he said.
The starting point for most post-disaster problems comes from breakdowns in supply chains, be they humanitarian or industrial. ALAN urges companies to prepare for disasters. Simply not being a victim is a contribution to community resilience.
“For example, whenever there’s a hurricane approaching, all of the voluntary programs and organizations start several days out with their preparations,” said Kathy Fulton, ALAN’s director of operations. “At that point they identify coverage gaps and as it gets closer they look to pre-positioning items outside the strike zone.”
Often companies — even the largest — are unprepared to react and immediately restart their operations after major disasters. Hewlett-Packard learned this in the aftermath of last year’s earthquake and tsunami that struck Japan and flooding in Thailand.
Many companies with component suppliers in these countries experienced significant hiccups in their product manufacturing. Tony Prophet, HP’s senior vice president of operations in the Printer and Personal Systems Group, said the hard drive parts and assembly sources for HP’s systems were located in the Thai floodplain.
“We needed a further understanding of our supply around our products, including what makes them and how our partners buy those components,” Prophet said. This led HP to conduct a detailed audit of its suppliers and sources for its products.
Menzies said companies should perform more audits of their supply chains to understand potential disasters, and conduct these analyses preferably on a rolling basis, like Cisco is well-known for and HP now does. “It’s not a once-and-done and put-it-on-the-shelf thing, it’s a continuing review process on the status of their suppliers around the world,” he said.
This creates resilience in the supply chain by discovering additional sources for products, and generating a list of alternatives to turn to when a disaster strikes. Menzies said “it’s a question of standing up alternative resources when your first line of support breaks.”
Fulton stressed that companies developing such a plan, whether it’s for humanitarian or business needs, must make their introductions and open up lines of communication as soon as possible “During a disaster you can’t go and exchange business cards, you have to know who is doing the work,” she said.
As businesses and communities expand, the impact of natural disasters will become far greater. Natural disasters caused an estimated $360 billion in losses during 2011, some of the most costly the world has ever seen.
“One thing that’s become very evident to us as we’ve gone through events over the past few years is that the business community is also looking for information. And because of who we interact with, we sometimes have the situational awareness that the general business community may not,” Fulton said. “The sooner businesses can get back to doing business, the lesser the burden on the community and responding agencies.”
The National Donations Management Network (NDMN), a digital repository of the Department of Homeland Security’s Federal Emergency Management Agency (FEMA), put together a portal where volunteer or relief groups can submit their requests for supplies and services and match those with participating businesses. It lays out a platform that companies could look to for their own supply chains.
Fulton said ALAN’s Web portal takes those posted needs from NDMN and offers them to a larger community. To further enhance this interface, ALAN has created a Capabilities Mapping Tool.
“It’s a visual, geographical representation of our network,” Fulton explained. The tool allows ALAN to search for companies that can meet needs based on their location, even if they aren’t part of ALAN’s network.
“Just a few critical resources for disaster response can be very critical,” Menzies said.
“A few years ago, points of distribution in Texas needed lift truck drivers. If you’ve got everything else but you don’t have a lift truck driver that’s a problem,” he said.