Toyota Announces They Will Shut Down North American Factories

Facing a parts shortage due to last month’s earthquake and tsunami in Japan, Toyota announced earlier today that they will likely shut North American factories.

The shutdown is said to be temporary, but also unknown is for how long the shutdown will last, and will affect about 25,000 workers here in the United States. All of which depends on how quickly the Japanese auto parts makers can get back to business.

Honda Motor Co. and Subaru of America also stated they would slow U.S. production to conserve parts as well.

Production of certain parts are not expected to resume for at least 30 days in a company memo to dealers and added, "Both the number of affected parts and length of production stoppage may increase."

The disaster in Japan, although exceptional in scope and size is an example how vulnerable our supply chains are. In our globalized world, everything is tied together and companies MUST do a better job at redistributing the risk of their supply chains, and it needs to happen quickly.

Large scale regional natural disasters are also tied to the globalized economy and this one will likely impact the overall recovery of the American economy which will further impacting the global economy yet again.  

Ironically, in the January copy of Reinsurance Magazine the article – World Cannot Take Another Crisis Global Leaders Warned and it points to the need to “solve future global risks before they become crises” and that “Twentieth century systems are failing to manage 21^st century risks.” More can and should be done to manage our risks.

Government of Barbados and other Caribbean Nations Consider Mandating Business Continuity Plans

The recommendation comes from consultant, Bob Turnbull, a business continuity management expert who has spent time in the Caribbean, the Middle East, and Africa.

The mandate would be for all companies regardless of size, and is an effort to ensure that resilience is built into the supply chains of these businesses. The call for the mandate comes at a time when business preparedness issues are highlighted due to the various and recent series of natural catastrophes around the world.

The mandate for the Caribbean Nations would put them ahead of many others, including the United States in calling for mandatory business contingency plans not just for large companies or critical infrastructure, but for all businesses regardless of size.

 As I mentioned in a previous posting, many calls are coming for increased business continuity and I expect this to be a continuing trend for much of 2011. What most businesses need to understand is that great business continuity is not a once in a while or sometimes thing or even an exercise to do one a year. Planning is not a product, but a process that should be improved upon and changed as your business changes.

One Crisis Often Leads To Another – Lessons From A Recent, Real World Incident

One of the better recent examples of how one crisis often leads to another is with BP and the incident in the Gulf with the Deep Water Horizon platform.

As most people are aware, the first crisis occurred when the blow out preventer failed leading to other explosions, fires and the oil leak (though some may say the first crisis occurred when certain protocols where not followed).

The massive oil leak lasted for months, leading to the additional crisis of how to handle the clean up and cap the unprecedented leak at depth.

The large oil spill in turn lead to the loss of income to businesses in parts of the Gulf and Congressional hearings forcing BP to take further action of setting up funds to reimburse losses.

The size and scope of the incident lead to questions from the media, along with public statements from BP which lead to a significant PR crisis for the company. Most would say this was handled very poorly by BP.    

The reimbursement process required BP to gather information from people who were claiming a loss. As of this morning it has been announced that BP has lost a laptop containing 13,000 names and personal information, including social security numbers of those filing claims with the company.

As you can see, once a crisis starts it can be difficult to stop the dominos from falling in other areas, even over the long term. One way to get in front of a crisis, and preventing a potential domino effect is to implement effective planning prior to an incident, along with training and discussions among your leadership team has to how potential crisis’s and incidents will be handled.



Calls for More Business Continuity Planning After Japan Earthquake and Tsunami

Whenever a major disaster occurs, calls for better planning usually follow as we are now seeing after the earthquake and Tsunami in Japan. And, what so often happens, one disaster gives way to or creates another as with the nuclear plant issues following the natural disaster. 

There is a lot we can learn from Japan as one of the best prepared nations in the world when it comes to preparedness and planning for natural catastrophe. The first of which should be no matter how well you plan or prepare ahead of time, something unexpected or catastrophic can still occur, and the need to be flexible in your planning and using your contingency plan as a tool box as opposed to a rigid set of ordered procedures that should be followed is extremely important.

One of the unfortunate things that happen over time especially in the business world is that this type of planning quickly becomes un-important. Even more so during tough economic times as the recent global financial troubles, contingency planning was one of the first things to go.

While I appreciate the calls for better preparedness and I do agree with those calls, proper planning must consist of a continually ongoing process. Planning itself is a process and not a product or something you can do once and put it on a shelf.

Here are just some of the links to recent stories calling for better planning, preparedness and disaster recovery.

Do You Have a Disaster Recovery or Emergency Plan?

Need for Business Continuity Plans

Emergency Planning Crucial in Disaster Recovery

One last thing, while planning is great, it is still not enough. Make sure you incorporate tabletop or other exercises to test and run through your plan and look for gaps and opportunities for improvement.  



What You Need To Know About Potassium Iodide or KI

The news is reporting on people buying up Potassium Iodide also known as KI in droves and that suppliers have run out and are scrambling to make more. One supplier has also donated a large supply to Japan.

I also know several preparedness retailers who have also run out and have a large number of orders being placed that they can't currently fill. The two things that worry me about this is first, the people who may need them may not get them since the supply is short (though governments do have stock piles of them) and the second is the potential for people who should not be taking KI to have adverse side effects.

Some facts you should know about KI:

• KI only protects the thyroid gland from radioactive iodide
• KI does NOT protect the thyroid from other types of radiation
• KI does NOT protect other parts of the body internally or externally from radioactivity or harm
• KI has the potential to damage or cause swelling to the parotid glands (they produce your saliva)

Other side effects include: acne, loss of appetite, or upset stomach. More severe side effects which require notification of a physician are: fever, weakness, unusual tiredness, swelling in the neck or throat, mouth sores, skin rash, nausea, vomiting, stomach pains, irregular heartbeat, numbness or tingling of the hands or feet, or a metallic taste in the mouth.

Severe allergic reactions from taking KI are possible especially if you have certain food allergies.

People who should avoid KI:

• You know you are allergic to Iodine
• Certain skin disorders such as dermatitis herpetiformis or urticaria vasculitis
• People with thyroid disease (for example, multinodular goiter, Graves’ disease, or autoimmune thyroiditis)

Lastly KI is considered a possible teratogen (meaning birth defects or developmental issues in young people).