Disaster management basics rev 1
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Disaster management basics rev 1

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Concerned about disasters? Disaster Management Basics provides an overview of how to survive a disaster as an organization from assessment to planning.

Concerned about disasters? Disaster Management Basics provides an overview of how to survive a disaster as an organization from assessment to planning.

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  • Debt becomes poisonous once it reaches 80% to 100% of GDP for governments, 90% of GDP for companies, and 85% of GDP for households. From then on, extra debt chokes growth. Stephen Cecchetti and his team at the Bank for International Settlements have written the definitive paper rebutting the pied pipers of ever-escalating credit."The debt problems facing advanced economies are even worse than we thought."
  • Understanding risk velocity is important - how hard you are hit by a risk realized can determine if your organization survives or flounders. Yet few executives have actually used risk velocity in their analysis of risk exposures.We all know “risk” – yet we really do not understand risk.
  • It’s all about targeted flexibility, the art of being prepared, rather than preparing for specific events. Being able to respond rather than being able to forecast, facilitates the ability to respond to the consequences of an event.We have the unfortunate tendency to view recent experience through a very narrow window of data sets. The data sets often times are based on convenience of access and data availability, rather than on research and a deeper analysis of a broader base of information. What is possible is a long way from what is probable. Determining what is probable takes a lot more effort and analysis. 

Disaster management basics rev 1 Disaster management basics rev 1 Presentation Transcript

  • Disaster Management Basics It IS All About Survivability Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Disaster Management Basics We tend to subconsciously decide what to do before figuring out why we want to do it. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business: what is it? Business is driven by strategy carried out in the form of plans by people who operate in existing and evolving markets. Every organization’s “strategic plan” (developed either formally or informally) identifies their critical objectives. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • What is a disaster? Merriam Webster:  something (such as a flood, tornado, fire, plane crash, etc.) that happens suddenly and causes much suffering or loss to many people  something that has a very bad effect or result  a complete or terrible failure What is a disaster for your organization? Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Is Your Organization’s Planning Brittle?  Do the organization’s plans stand in silos of excellence?  Are activation and implementation of plans independent and uncoordinated?  Does the organization face critical junctures of survival every time an event or certain shocks affect it?  Does analysis of “worst case” scenarios underlay the basis for planning?  Do the plans reflect the strategy, goals and objectives of the organization? Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Is Your Organization’s Planning Brittle?  We live in a complex and interdependent world, filled with complex systems that are full of interdependencies (touchpoints) that are hard to detect.  The result is nonlinearity in responses to events, especially random events/shocks.  The odds of rare events are simply not computable.  Model error swells when it comes to small probabilities.  The rarer the event; the less tractable, and the less we know about how frequent its occurrence. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Is Your Organization’s Planning Brittle? Complexity Touchpoints Responsiveness Resource Constraints It is much easier to sell: “Look what I did for you” than “Look what I avoided for you.” Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business Continuity – From What? What is going to cause discontinuity? Natural Disaster? Sabotage? People? Fraud? Operations? Mismanagement? Internal Factors? EHS Issues? Workplace Violence? Power Failure? Cyber-threats? Nuclear, Chemical, Biological? Terrorism? What is the single highest probable failure factor for your business? External Factors? Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • How much Analysis are you doing right now? Symmetric Threats – Natural, Normal, Abnormal Natural Disasters •Hurricanes •Earthquakes •Floods •Tornadoes •Drought Physical Disasters •Industrial Accidents •Supply Chain •Value Chain •Product Failure •Fires •Environmental •Health & Safety Information Disasters •Theft of Proprietary Information •Hacking, Data Tampering •Cyber Attacks Personnel Disasters •Strikes •Workplace Violence •Vandalism •Employee Fraud Economic Disasters •Recessions •Stock Market Downturns •Rating Agency Downgrade Criminal Disasters •Product Tampering •Terrorism •Kidnapping & Hostages Reputation Disasters •Rumors •Regulatory Issues •Litigation •Product Liability •Media Investigations •Internet Reputation •Social Media Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • How much Analysis are you doing right now? Asymmetric Threats – Known is replaced by the invisible foe Put simply, asymmetric threats are a version of “not fighting fair,” that can include surprise, unplannable and unpredictable events, impacts to your touchpoints that have not been anticipated. Not fighting fair also includes the prospect of an opponent designing a strategy that fundamentally alters the markets that you compete in. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business Impact Analysis what are we analyzing? We know now what to measure, we know the current performance and we have discovered some problem areas. Now we have to understand why problems are generated, and what the causes for these problems are. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Prediction – Projection If you don’t know what you don’t know, how can you prepare for it? Conventional practices leave us vulnerable to random, potentially catastrophic events, that cannot be predicted based on simple extrapolations from the past or projections of the future. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Emerging Risks – Likelihood, Impact & Velocity High Global Workforce Environmental Competition Sovereign Debt Geo-Political Infrastructure Markets RISK VELOCITY Likelihood Economies Very Rapid Foreign Sources Alternatives Technology Impact of the risk would be evident in a month Rapid Impact of the risk would be evident in a quarter Slow Social Trends Impact of the risk would be evident in a year Low Low Impact High •Traditional risk assessments that prioritize risk on probability and impact are outpaced by the speed at which risks move throughout the organization. •While 70% of finance executives agree that risk velocity is a core consideration, only 11% have introduced it into their risk assessments. Source: Deloitte; Risk Integration Strategy Council Research Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Six Key Questions STRATEGY: What are we committed to? CONCEPT OF OPERATIONS: How will we fulfill these commitments? STRUCTURE: Do we have an organization that serves our needs? RESOURCE MANAGEMENT: How will we manage our resources? CORE COMPETENCIES: What skills do we expect from our organization? PRAGMATIC LEADERSHIP: How will we optimize authority, decision-making, workflow, information sharing? Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Decision Making Issues Related to Risk Neutralize Share Diversify Mitigate Transfer Contain Identify Alter Offset Effects Reduce Exposure Control Alleviate Impact Change Negative – Positive Insure Against Loss Monitor Hedge Derivatives Discount Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Living in a Non-Predictive World A stone and its weight in pebbles – size matters. A collection of small units with semi-independent variations produces vastly different risk characteristics than a single large unit Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business Continuity Lifecycle Recovery Management Crisis Management Emergency Response Response Mitigation Termination Normal Business Operations Transition Point 1  Activation  Reactive Response  Chaos Business Recovery Systems/Information Recovery Reentry Restoration Resumption Transition Point 2  Unplanned Disruption Resumption Transition to New Normal Operations Transition Point 3  Planned Disruption New Normal Business Operations Transition Point 4  Termination Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • How Well Will Your Organization Transition? Transition Point 1 Activation Reactive Response Chaos/Uncertainty Transition Point 3 Planned Disruption ? Transition Point 2 Transition Point 4 Unplanned Disruption Termination Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Plan – Respond – Recover – Restore – Resume Plan High Resume Event Response Restore RTO Recovery RPO Level of Service (Image and Profile affect degree of disruption) Graceful Degradation Stability Levels Agile Restoration MTO Low CTL Time (Time Critical) (Time Sensitive) (Time Dependent) Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Plan – Respond – Recover – Restore – Resume Plan High Resume Event Response Restore RTO Recovery RPO Level of Service (Image and Profile affect degree of disruption) Graceful Degradation Stability Levels Agile Restoration MTO Low CTL Time (Time Critical) (Time Sensitive) (Time Dependent) Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Plan – Respond – Recover – Restore – Resume Plan High Resume Event Response Restore RTO Recovery RPO Level of Service (Image and Profile affect degree of disruption) Graceful Degradation Stability Levels Agile Restoration MTO Low CTL Time (Time Critical) (Time Sensitive) (Time Dependent) Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business Continuity Lifecycle Graceful Degradation + Agile Restoration = Resilience Full Functionality Detectors/Indicators of change Minimum Stable Functionality Maximum Stable Level of Service Devolve to most robust less functional configuration (Personnel, Time, Product, Services) Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • RMR3 – Flexibility Management Operations Logistics Seamless Communications Finance Administration Internal/External Relations Infrastructure Planning Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Building an effective crisis management team Why Crisis Management Teams Fail:  Crisis Management Team does not know its own reaction time;  Communications;  Micro-Managing;  Decisions are left at low levels;  Allowing problems to compound. Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Building an effective crisis management team Your biggest challenge: Getting the team to work together when they generally do not function every day as a team Your next biggest challenge: Getting the team to comprehend their crisis management roles, responsibilities, functions and how they differ from their day-to-day roles, responsibilities and functions Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Crisis Management Team (CMT) Team Competencies (TC) How good are the team members? Are they still struggling with basic procedures? Team Identity (TI) Does everyone know who does what? Do they help each other out? Is anyone micro-managing? Is anyone “out of it”? Team Metacognition (TM) Who’s taking responsibility? Do they spot and correct problems? Do they get crunched for time? Are they “territorial”? Team Cognition (TC-1) Is the CMT heading for the same goals? Does everyone have the same picture? Are they consistently in a reactive mode? Do they get paralyzed by uncertainty? Gary Klein: “Sources of Power: How People Make Decisions” Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Business Continuity – Three Levels Strategic Level – Saving the business Operational Level – Containing Business Unit Impacts Key Functions Leadership (Management) Planning Operations Logistics Finance Administration Infrastructure Internal/External Relations Tactical Level – Operational Actions Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • Three Spheres of Concern SPHERE OF INFLUENCE Your assets and capabilities can affect the courses of action of others SPHERE OF RESPONSIBILITY Your corporate mission, vision, values, goals, objectives SPHERE OF INTEREST Assets and Capabilities of others can effect your courses of action Copyright 2013, Logical Management Systems, Corp., all rights reserved
  • “If you keep doing what you’ve always done – you’ll keep getting what you’ve always gotten.” Geary W. Sikich Principal Logical Management Systems, Corp. www.logicalmanagement.com gsikich@logicalmanagement.com g.sikich@att.net +1 (219) 922-7718 Copyright 2013, Logical Management Systems, Corp., all rights reserved