by: Nicole Ross

Source: Disruption Defense: Hurricanes. Contingency Planning & Management. July, 2002: pp 38-40. Reprinted with permission from Witter Publishing Corp. Content contained on www.ContingencyPlanning.com.

Cause and Effect
Hurricanes form when the air over ocean water, with a surface temperature of 80°F or higher, heats up and absorbs moisture. With the right conditions, a hurricane results in violent waves, torrential winds and rain that gather around the storm's center, and floods.

On average 10 tropical storms per year develop over the Atlantic Ocean, Caribbean Sea, and Gulf of Mexico. Although many stay offshore, six of these storms develop into hurricanes - characterized as storms with heavy circular wind rotations exceeding 74 mph - each year.

Hurricane season generally lasts from June 1 to November 30, with a majority of activity in August and September. Primarily, hurricanes are active along the East Coast, especially in the southeastern United States and the Caribbean, but occur anywhere from Maine to Texas.

-National Weather Service (www.nhc.noaa.gov)

Common Threats
Four threats stemming from tropical weather systems that can impact businesses financially, as delineated by Michael R. Smith, CEO of WeatherData (Wichita, Kan.) and a certified consulting meteorologist, are:

• Wind. Heavy winds and falling trees can damage structures.

• Storm surge. Tidal flooding is a threat to any business on the coast or a tidal estuary.
• Inland flooding. This can be one of the most dangerous aspects of tropical storms and hurricanes and can occur hundreds of miles from the point of landfall. In 2001, Tropical Storm Allison caused almost no wind damage but was the costliest tropical storm in history with $5 billion in damage and 22 lives lost due to flooding.
• False-alarm risk costs. Smith defines false alarm risk costs as those undertaken by a business to prepare for a storm that does not materialize, and he purports that costs associated with hurricanes have increased in the last three decades. For example, a typical hurricane affects about 125 miles of coast, but the average official hurricane warning is about 400 miles. In the case of 1999's Hurricane Floyd, 2000 miles of coast were warned and the false alarm costs amounted to more than $1 billion.

Mitigation Measures
"If it has happened in the past, it is reasonable to assume that it can happen again," says Max San Juan, a leasing manager at Terremark Worldwide Inc. (Miami, Fla.). "The National Hurricane Center predicts the 2002 hurricane season will have nine to 13 storms - six to eight hurricanes and two to three major hurricanes. With this in mind, companies are at an even greater risk of financial loss due to catastrophe. It is crucial that businesses develop and maintain a proper DR/BC plan."

In addition, business can:

• Develop a roles and responses checklist. Inform clients and vendors of your plan and provide contact information for key executives.

• Assess what losses your business interruption insurance will cover.

• Create a crisis communications plan that includes employees and their families, customers, shareholders, business partners, and the public.

• Follow weather developments via news and radio broadcasts. A hurricane watch means that hurricane conditions are likely in the specified area within 36 hours of its issuance. A warning signifies that conditions are likely within 24 hours.

• Move or secure any items, such as printers, computer terminals, etc., that could fall or be damaged or cause damage. Secure all windows and outside equipment.

• Determine which records and files need to be transported to an alternate site. Test to see if backup files stored at offsite locations can be accessed.

• Review and test evacuation procedures.

• Stock emergency and medical supplies.

• Ensure availability of portable pumps and temporary power sources, such as generators or gasoline-powered pumps and battery-powered lighting.

• Test fire extinguishers and inspect building sprinkler systems.

• Plan alternate methods for employees to continue regular operations, whether at a hot site, via telecommuting, etc.

In the Aftermath

• Activate your crisis communications plan.

• Search the premises for live power lines, leaking flammable gases, or flammable items that could fall.

• Ascertain if there is any damage to pipes, and use portable pumps to remove floodwater.

• Call utility companies to restore any failed services.

• For insurance purposes, assess damage to the facility, documenting areas or equipment.

Expert Advice
"The amount of physical damage to a business does not necessarily determine whether that business will survive or fail following a natural disaster, according to new research conducted by the University of Wisconsin's Center for Organizational Studies in Green Bay. Rather, the amount of adapting to the changed environment by a business will be a determining factor in survivability.

"The research, funded by a grant from the Public Entity Risk Institute (PERI), also found that the long-term future of a business depends on the effects of a disaster on a business's customers more than the effects of the disaster on the business itself.

"Research teams involved in the study visited seven disaster sites in different areas of the United States, going back to Hurricane Andrew in 1992 and up to as recently as the 2000 Los Alamos fire. Researchers met with business owners and nonprofit leaders whose organizations were affected by natural disasters.

"The research resulted in five factors that help determine an organization's survivability:

• The disaster's impact on the business or organization's customers and clients. If customers are displaced, a new client base will need to be built.

• The easy availability of substitute goods and services. This availability will help a business only if the business is not shut down during the recovery period.

• Industry trends for a business prior to a disaster. If the trend was declining before a disaster, recovery is more difficult.

• The extent of financial resources an organization has lost. If it is substantial, the ability to rebuild or relocate will become more difficult.

• Leadership's ability to adapt to the new business environment. Nothing is the same following a disaster, and the sooner a business owner or executive recognizes the changes impacting business, the sooner the organization will be on the road to long-term survival."

-Charlie Reese, The Institute for Business and Home Safety

Real-Life Lessons
On Friday, June 8, 2001, showers at Tropical Storm Allison's tail end dumped up to three feet of rain over the Houston area. Floodwaters swamped the million-square-foot UT-Houston Medical School building to a level of 22 feet, filling the basement and part of the first floor with an estimated 10 million gallons of water. Power outages and other flood-related problems caused eight area hospitals to declare internal disasters, including Memorial Hermann Hospital.

At 1:30 a.m. on Saturday morning, June 9, Memorial Hermann Hospital lost power, and UT-Houston physicians, nurses, and medical students evacuated some 540 patients needing full-time care to outlying hospitals. For the first time in its 76-year history, the hospital closed.

By Monday morning, June 11, workers were pumping water from the medical school building, and on Tuesday most of the water in the basement had been pumped out. The university's Internet access and e-mail were mostly restored Monday after the storm shut those systems down on Friday night. On Thursday, the university's voicemail was finally restored. Cleanup crews began to remove hard drives from the hard-hit basement, hoping to salvage the data they contained.

Early estimates placed the total damage to the medical school at $72 million.

-www.uthouston.edu

The Federal Emergency Management Agency (FEMA), a U.S. federal agency that coordinates responses to national disasters, traditionally dealt with two problems during flood situations - one weather-related and one paper-related.

Unable to predict or control a natural flood, IT project managers Bill Barton and Mike Miles of Computer Sciences Corp., contractors to the National Flood Insurance Program (NFIP), turned their attention to improving the flood of paper and information required to administer NFIP. Essentially, they needed an "IT sandbag" and turned to Information Builders, a business intelligence company, for help.

Tropical Storm Allison became the first major test of the FEMA/Information Builders relationship. By the time Allison was moving toward the Texas and Louisiana coastline, Miles had helped to build an extensive, analytic Web-enabled intranet called BureauNet, which directly tapped into the NFIP files. Knowing that insurance data normally moved monthly, the team also developed QuickClaim, which put new insurance and claims data on the intranet within days. As Allison's winds escalated, FEMA staff was able to access online reports and analytical data from portable computers in disaster areas, as well as reach NFIP's data over wireless Internet connections, to offer quick responses.