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Impact of Disasters on the Transportation Sector Ralph Petti, MBCI, CBCP President, Continuity First, Inc. Member , North Carolina Chamber of Commerce North Carolina League of Transportation & Logistics Annual Conference – Myrtle Beach, SC June 22, 2012. Agenda. Welcome/Overview Credentials - PowerPoint PPT Presentation

Transcript of Welcome/Overview Credentials Disasters Major global disasters

  • Impact of Disasters on the Transportation Sector

    Ralph Petti, MBCI, CBCPPresident, Continuity First, Inc.Member, North Carolina Chamber of Commerce

    North Carolina League of Transportation & LogisticsAnnual Conference Myrtle Beach, SCJune 22, 2012

  • Welcome/OverviewCredentialsDisasters Major global disastersAffecting global transportation and you!Transportation SectorTransportation issues facedIncreasing supply chain trendsPreparing for DisastersWhat are the options?What can you do about it?Next StepsBusiness Impact AnalysisGap AnalysisUnderstanding the consequences


  • About Continuity First, Inc.Incorporated in April, 2005 by executives of industry-leading firmsMany team members have 30+ years of disaster planning experience Headquartered in the Richmond, Virginia areaRegional offices throughout the United StatesInternational clientele in Central America, Southeast Asia and EuropeSBA Small Business/Woman/Minority Certified (SWAM)Extensive team of certified Business Continuity expertsFocused on Public- and Private-Sector CollaborationAward-winning team with recognition from Sen. Mary Landrieu (D-LA) for our efforts to train and recover citizens of The Gulf Region from disasters

    Member, North Carolina State Chamber of Commerce with clients and partners in over two dozen N.C. counties and govt agencies

  • As you all well know

    Every company relies on some form of transportation to conduct their business and transportation is a key part of the worlds critical infrastructure,andIt is difficult for companies in the transportation sector to respond when major roads, airports and shipping lanes are closed and supplies are needed most critically.

    However, most companies do not have a testable plan for: Disaster Recovery backing up their data and networksBusiness Continuity identifying specific business processes

    < This becomes a major area of concern for all involved >

  • Continuity First - Global References

  • Definition of: A Disaster The result of a hazard impacting a community

    Source: Federal Emergency Management Agency (FEMA)

  • TSAs Mission Transportation Security Administration (Homeland Security)

    The Transportation Security Administration protects the Nations transportation systems to ensure freedom of movement for people and commerce.

    (TSA, Mission, Vision, and Core Values, accessed November 17, 2007

    Source: Federal Emergency Management Agency (FEMA)

  • Key USA Disaster Recovery Statistics

    93% of Americans are not prepared for a disaster at home

    61% of all small businesses do not have a plan at all.

    40% of all businesses that do not have a disaster plan will go out of business within two weeks of a disaster event.

    Source: Federal Emergency Management Agency (FEMA)

    Businesses MUST prepare themselves - US Department of Homeland Security

  • Disaster events in 2011NationallyHurricanes Gulf, Eastern Tornadoes in 30 States!Earthquake NortheastFires Pacific/SouthwestIce Storms Northeast/MidwestFlooding Midwest/Cedar Rapids:08Drought Southwest/MidwestPower Outages Everywhere and. Fukushima A BLACK SWANEarthquakeTsunamiNuclear Compromise

  • Major Global Disasters

    CrisisYearCrisisYearTornados in AL, MO and MA?2011Islamabad Bombing2008Support Flight Accident2010Airline Flight 30542007Major University Crisis Response2010Gulf Coast Hurricanes 2005Haiti Earthquake2010Brookfield Shooting2005So. AmericanEarthquakes 2010Pinnacle Air Flight 3701 2004Binghamton Shootings2009CorporateAirFlight 59662004H1N1 Response2009Islamabad Bombing2004Butte, Mont. Crash2009Jakarta Bombing2003

  • Major Global Disasters:

    CrisisYearCrisisYearAirline 236 Accident2001Fortune 500 Co. Shootings1999Terrorist Attacks-NYC, DC 2001American Airlines 1420 Accident1999Major Tech Office Shootings2000Amtrak Train Derailment1999Singapore Airlines 0062000Littleton, CO Shootings1999Alaska Airlines 261 Accident2000Oklahoma City Bombing1995Executive Air Accident2000East Coast Hurricanes1993Saudi Arabian Airlines Hijacking2000World Trade Center First Bombing1993Egypt Air 990 2000So Cal Earthquake 1993

  • The Impact of Disasters on the Transportation Sector

  • TraditionalLogisticsOperator AccreditationAsset ManagementRoute PlanningEmployee TrainingFuel CostsOperator ShortfallsIncreased Freight RatesInternational CompetitionHuman Resources/ComplianceSupply Chain Dependence

    Additionally The Impact of Disasters

    Transportation Sector Some Issues Faced

  • Airports Closed September 11, 2001Roads Closed it happens every dayKansas City examplePorts ClosedPort AuthorityRailways ClosedPassengers and FreightBridgesMinnesota Bridge, Midwestern FloodsSupply Chain failuresBreakdown of one entityMany more fuel shortages, strikes, weather, etc.

    Actual Impacts of Disasters: Transportation

  • TraditionalLogistics.Late runs, Service Level concernsOperator Accreditation.Replacement credentialsAsset Management..Accounting, accountability Route Planning.Change and misinformation Employee Training...Postponed due to priorities Fuel Costs........Using alternate suppliersDriver Shortfalls...Alternate routes on local roadsIncreased Freight Rates.Just In Time delivery issuesInternational CompetitionOthers can step into your accountHuman Resources/Compliance.Great scrutiny at time of disasterSupply Chain dependence........Perhaps, the most difficult to control < ATOD At Time of Disaster >

    Disaster Consequences in Transportation

  • Travel & Transportation CEOs are clear about their plans to leverage partners as a source of innovation

    In 2012 67% of Travel & Transportation CEOs interviewed planned to partner extensively

    In 2008 47% of that same group interviewed made that same claim in the 2008 CEO study.

    Source: IBM Global CEO Study with face-to-face interviews with more than 1,700 CEOs in 64 countries and 18 industries Dated: May, 2012

    Global Studies reflect Supply Chain growth

  • Perhaps, you are protected what about your Supply Chain partners?

    Have they protected themselves from disasters as well as you have?

    It takes just ONE Supply Chain partner to put you out of business.

    So, what can you do about it?

    As Wal-Mart, Target, Boeing, Capital One and other major companies do:

    Require your partners to have a Testable Recovery Plan!

    Choose prepared Supply Chain partners

  • Preparing for Disaster Events

  • Some very important questions to ask yourself:

    Who is in charge (and accessible) at time of disaster? What is the real cost of a disruption to your business?Where do you recover your business if you relocate?When do you make the decision to mobilize resources?andHow can I be accountable to both my family and business at the same time if there is a choice to be made? How long does it take us to recover from a disruption?How do we reach our employees out on the road?

    Due to todays liability laws, and just plain common sense, all businesses need answers to all of these questions

  • Disaster Planning Tools are available to all businesses but, what do you really need?Gap AnalysisRisk AssessmentBusiness Impact AnalysisEmergency Preparedness Crisis Management PlansDisaster Recovery PlansBusiness Continuity PlansEvaluation of Current Plans Notification/MessagingCOOP/COGS interfacingDisaster Planning software for companies in all sectors

    Workplace Violence Transportation SolutionsHealthcare SolutionsContent ManagementWorkplace Recovery Employee PreparationShelter At HomeShelter In PlaceHuman Resources Nuclear Threat ResponsePandemic PlanningExercise & Testing

  • What are you doing right now?Are you backing up your data off-site every day?Have you developed the procedures to recover your business?Have you designated certain people in succession roles?Do you maintain alternate facilities to run the business?Have you ever truly tested your recovery processes?

    What plans do you have?Disaster recovery of data and network systems?Business Continuity of business processes?Crisis Management Plans?Emergency Management Plans?Coordination with police, fire, medical facilities nearby?


    Where do you begin?


    Record Retention & Back-up Procedures

  • But, Have You Planned for Your Business Beyond Data Protection and Backup?

    Developed procedures to recover your critical business functionsAccounts Receivable?Logistics?Communication?

    Verify that recovery procedures work as planned?

    Trained employees on response beyond emergencies?

    Planned for the impact of Supply Chain failures?

    Do you have a place from which you can run your business that is absolutely ready to go, and no one can get in front of you to take it?

  • Next Steps

  • Take stock of what you are doing right now

    Make sure that these plans are current (well beyond Y2K)

    Understand your Supply Chain partners a little better

    Test your plans to see where how proficient your team is

    Act to address any weaknesses or gaps

    Major companies (including a few in this very room)do what they need to do to be successfulWhat else can you do to prepare?

  • Business Impact Analysis

    A process designed to prioritize business functions by assessing the potential quantitative