Dealing with disasters
by Graeme Mickelberg
Senior management personnel can take pre-emptive action to minimise the impact of a crisis on their organisations. As Graeme Mickelberg writes, effective crisis management planning is a powerful tool to protect assets and ensure the best possible response to an emergency.
Disasters, whether natural or man-made, inevitably attract media attention and when the community is affected the impact of disasters assumes greater importance, resulting in additional issues for organisations and businesses.
The Longford gas disaster in Victoria and the Canberra bushfires are examples of such circumstances. With Longford, the consequences of the industrial accident extended well beyond the refinery, resulting in energy cuts to other businesses and domestic users, many of whom had to go without hot water and central heating for protracted periods.
The Canberra bushfires were a natural disaster and had an immediate impact on the community. The result was the destruction of homes on a large scale.
These two disasters were crisis situations that attracted national and international media attention, resulting in public inquiries that handed down adverse outcomes for governments, organisations and businesses.
Both of these disasters resulted in lessons, not only for the Victorian and ACT governments and their agencies, but also for other businesses and organisations. Time was spent monitoring and analysing the outcomes and recommendations of the inquiries and considering them in the context of their business or organisation.
Fail to learn
Unfortunately, human nature is such that more often than not many businesses and organisations, including governments, fail to take the time to learn from other's lessons; even though the consequences of disasters and emergencies may cause loss of life, loss and damage to property, adverse environmental impact, business interruption, financial loss, litigation, adverse media reporting and damage to corporate reputation.
The terms "disaster" and "emergency" may have similarities and it might be argued that an emergency could become a disaster. However, what is important for an organisation considering its approach to managing such situations is to define what constitutes a disaster as distinct from an emergency. This is an important step and should provide the basis for policies, planning and procedures to manage such situations.
Many organisations prefer to use the terms "crisis" and "emergency", taking into account the implications for the business or organisation. The parameters used to discriminate between a crisis and emergency may include consequences to humans, productivity, financial cost and media coverage.
What is important is to ensure clear and unambiguous definitions are developed because this will provide the basis for parameters to guide management decision-making. The primary objective here is to ensure a timely, incremental and cost-effective response that will prevent loss of life and injury to people and minimise damage to property, damage to the environment and facilitate a rapid recovery of business operations as secondary objectives.
The nature of these parameters for the management of crisis and emergency situations will vary from one business to another. However, once determined, the parameters should be documented in a corporate crisis management plan that provides guidance as to the thresholds for decision-making and actions to be taken.
Mitigating the impact of crisis and emergency situations depends significantly on planning. All too often inquiries, including royal commissions and coronial inquiries hand down adverse findings which reflect adversely on the timeliness and quality of planning and decision-making.
The quality of planning undertaken in response to emergency and crisis situation is directly affected by the time taken in anticipation of such situations. It is important to consider potential situations and to develop plans that may be used to facilitate an initial response.
Each crisis and emergency will be different
Such planning should be conceptual in approach, acknowledging the circumstances of each crisis and emergency will inevitably be different.
Accordingly, the objective of planning should be to provide a conceptual framework based on an analysis of likely contingencies. This requires a clear understanding of risks confronting the business. These risks should be recorded in the corporate risk register. This register will provide a reference source for managers and, depending on the rating of particular risks, the priority given by the business to dealing with risks when they occur.
Guidance for planning is provided by a range of Australian standards that should be used as benchmarks. The following standards are examples:
* ASNZ 4360: 2004 Risk Management
* HB 221:2004 The handbook, Business Continuity Management
* HB 221:2000 The handbook, Information Security Risk Management Guidelines
* AS 3745 –1990: Emergency Control Organisation.
Endorsed by the CEO
Other planning guidance should be included in a corporate crisis and emergency management plan, which should be endorsed by the CEO or head of the organisation. The effectiveness of such guidance depends on periodic audit and updating of the plan.
Many organisations mistakenly assume that managers, including the CEO, have the skills to effectively plan when confronted with crisis and emergency situations. This is an unsafe assumption as the demands of a crisis and emergency may be significant, exposing managers to pressures outside their experience.
The approach taken by universities to prepare people for decision making roles does not extend to exposing them to the rigours of a crisis situation, which may extend over a protracted period involving fatalities to fellow workers and friends.
The reality is that specialised training is required to prepare managers in the same way as the Police, emergency services and defence forces provide such training to persons identified for senior leadership and management roles.
The provision of a planning process for use within a business or organisation is an important tool to ensure the effective use of time. Underpinning the design of a planning process is the objective of integrating planning considerations of relevance to the operating environment of the particular business or organisation.
The effective use of such a methodology depends on an outcomes based focus requiring the identification and consideration of a range of inputs. Also important is the flexibility to apply the methodology to a variety of situations or contingencies likely to be encountered.
Regular practice should be scheduled
Regular practice using the methodology should be scheduled, involving managers from each of the functional parts of the organisation. The role taken by the CEO or organisational chief may be as a facilitator, or alternatively that person may be an active participant with facilitation undertaken by another person.
The preparation of a business or organisation to be ready and able to effectively meet the demands of crisis and emergency situations requires the provision of corporate policy, plans and procedures. Also required are skills and the knowledge necessary for managers to make decisions to avoid adverse impact to people, property and reputation.
Inevitably, time and resources are required. However, the experience of others who have suffered the adverse impact of crisis and emergency situations should be sufficient justification to take a proactive approach.
First published in ASM March 2008 edition.
About the author: Graeme Mickelberg is a security risk consultant. His business, Hydra Enterprises Pty Ltd, has national and international clients in the private and public sectors. Graeme can be contacted by email at hydraenterprises@telstra.com or on 0407 113 909.