Our thoughts at MDM are with our many customers and their families in the Houston and coastal areas of Texas and Louisiana. We have heard many stories of their struggles to be safe and of protecting loved ones first, then focusing on how to recover from the business impacts. We wish all those affected our very best for their safety and quick recovery.
As Hurricane Harvey shuttered ports and distribution centers at the end of August (and at press time, Hurricane Irma was poised to hit Caribbean islands hard with Florida in its potential path), the deluge that inundated Houston and surrounding area served as a stark reminder that all companies would be wise to develop an emergency plan in case of disaster.
Houston is the country’s fourth-largest city, one of the busiest U.S. ports and headquarters for many distributors, extending the disruption well beyond Texas and long after the floodwaters recede. Oil prices have already risen, and it could take weeks or months to assess the damage at warehouses and chemical plants in the area. Ports are slow to regain normal traffic flow, though there is some progress on that front, as of press time.
Not every disaster or disruption can be averted, but assessing potential threats to your company and supply chain, as well as how to mitigate some of the issues that might arise, is critical for any distributor. The first step is to acknowledge that disruption to your business or supply chain is likely at some point in its lifecycle. Natural disaster, labor strike, material shortage, supplier bankruptcy, cargo theft or any number of other factors could threaten your company’s operation.
Any disaster plan should start with procedures for safeguarding your team members first. There are some steps you can take after that to mitigate other challenges. Paul Dittmann, executive director of the Global Supply Chain Institute at the University of Tennessee-Knoxville, shared with me some key thoughts for distributors for a 2015 story regarding emergency planning.
Identify possible risks that could affect your supply chain. Rank the risks by how much they would impact your company and the likelihood of them happening. Then create a contingency plan that would keep your supply chain moving – or at least return it to operation quickly should one of these risks occur. This can include everything from finding alternate suppliers to securing multiple transportation networks to establishing emergency communication channels. Do the same for your customer support, as well.
Disaster mitigation and emergency planning processes take time, planning and resources. Having a plan in place and never using it will always beat not having one and needing it when another disaster as devastating as Harvey strikes.
Looking for ways to help victims of Hurricane Harvey? Charity Navigator has a list of several organization with boots already on the ground at https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=5239.