Has the bird flu issue really landed in the boardroom?

Category Business Continuity Management BCM - Avian Flu- BCM Bird Flu Risk - News

Is Bird Flu starting to hit Boardroom thinking? 

When the H5N1 strain of bird flu first raised fears in Europe last autumn as migratory birds began to die across the continent, Bob Piggott presented plans to HSBC's executive team on how the bank was preparing for a possible future human pandemic. As public concern rises further with the lethal form of flu claiming its first European victims in Turkey in recent days, Mr Piggott, head of group crisis management, feels that HSBC is relatively well equipped to cope if the virus spreads. But he is under no illusions about the threat a pandemic poses, and still sees gaps in his bank's ability to respond, not to mention the risk for other organisations in facing up to the issue. "[Flu] is probably the single biggest challenge for the whole group," he says. HSBC now has national contingency plans in place for each of the 77 countries in which it operates.

Many other organisations though are less prepared. A survey released last month by the Centre for Health Solutions at the US arm of Deloitte & Touche, the consultancy, suggested that respondents at just 14 per cent of the 179 companies polled believed their pandemic planning wasadequate. "A pandemic flu outbreak in any part of the world would potentially cripple supply chains, dramatically reduce available labour pools, and greatly diminish trading partner and US business ability to meet scheduled obligations," Deloitte & Touche warned.

"There is no doubt that awareness of the threat is high, but sadly this is not accompanied by the essential impact analyses and planning," says David Lloyd, a consultant with Survive, a London-based continuity management association currently developing guidelines on the subject. His organisation brought together 30 corporate crisis managers just before Christmas to discuss a flu pandemic, triggered by concerns that the business continuity issues raised had received only modest attention from government.

In fact, there has been considerable activity behind the scenes. For more than a year, some companies - notably in power generation, telecoms and retail - have participated in simulation exercises with the Health Protection Agency designed to test responses to a pandemic.

Bruce Mann, head of the Civil Contingencies Secretariat at the Cabinet Office, who helps co-ordinate contingency planning for the government, says that a number of key strategic sectors identified as critical during a pandemic - such as utilities, banking and the emergency services - have made good progress. His office is shortly to release updated guidance highlighting continuity issues in business as well as organisations such as the National Health Service.

Other parts of government, including the Health and Safety Executive (HSE), have also released pandemic advice for business. However, there is still a clear gap between high-level planning and practical application, even among companies that have given the issue some thought. For some, the pandemic risk seems exaggerated or simply one abstract priority among so many others that are more pressing. The reality is that while most health specialists agree a new pandemic is a matter of "when, not if", the constantly changing nature of the flu virus means that none can yet predict its timing, severity or character.

Even so, the British government - backed by informal World Health Organisation estimates based on the proportion of the population likely to catch the flu - suggests that up to a quarter of employees could require time off work across the duration of a pandemic. Mr Piggott believes the figure could be much higher. He is planning for absences of up to 50 per cent, allowing for those who are ill, those who stay at home to look after others,including children taken out of school, and those trying to protect themselves from infection by avoiding work. "Absence levels could have a profound effect, especially in sectors where there are critical numbers for a business to function," says Mr Lloyd. He cites likely temporary closures, such as in small branch offices with minimum staffing levels determined by safety issues.

While many businesses have contingency plans for one-off events such as floods, terrorist attacks or computer failures, pandemic planning presents a different challenge: it needs to handle a wave of infection lasting for two to three months, with a possible repetition a few months later. A second unusual aspect of a pandemic is the "cascade effect": flu will not affect a single company or region, but an entire country and - with a short time lag - most other parts of the world. That means companies will be far less able to rely on outside support than at normal times. One critical weak link is transport - many experts believe public transport and road haulage are still relatively poorly prepared. That has implications as diverse as stranded commuters, food shortages and empty cash machines.

Mr Mann from the Cabinet Office warns against the common belief that army drivers could make good the situation. "There are not that many heavy goods vehicle drivers in the army, and most of them are in Afghanistan or Iraq," he says. So what are the key priorities? The first is planning, backed by support from the boardroom. "Companies need to do rigorous planning sooner rather than later, and carrying out a relative risk assessment on how their business processes, customer support and human capital could be affected at various levels," says Bob Campbell from Deloitte. "They should think about contingency planning around alternative suppliers, distribution methods, home-working and how their clients' organisations would support alternative approaches." Mr Mann stresses that contingency plans often cover the bulk of middle-level employees, but miss out vital gaps at the top andbottom of organisations. "Senior executives are not immune," he says. "How would the company cope if one of them falls ill?"

On the other hand, recent cost cutting in many organisations means that just a handful of technical staff - "Fred in the boiler room" or "Bill in IT" - may prove pivotal. If they fall ill, the entire company may suffer. Companies need to plan for shifting employees between jobs, to cover essential functions and to respond to changes during a pandemic such as a surge in telephone or internet use. As the HSE points out, reallocating staff may require re-training. Planners need to think about employment legislation too, ensuring that pregnant women or others with particular constraints are not moved to inappropriate jobs. They also need to ensure mobile staff have access to high-speed internet connections to allow them to operate efficiently.

Those with international staff may consider travel restrictions or temporary repatriation. Some businesses are considering providing staff with antiviral drugs that may help with treatment and even prevention. But they face supply shortages, legal constraints on prescribing medicines and ethical issues on how to distribute them. Experts are doubtful of the efficacy of masks, which quickly become saturated. However, the HSE recommends a number of more practical hygiene steps to limit infection, including regular office cleaning and careful disposal of tissues. A final issue is communication, to keep employees informed, hold planners accountable and promote customer confidence. At a time of misinformation, clarity could prove vital.

The impact of the next flu pandemic is still emerging, and planning for it requires resources. But if the virus proves as potent as many fear, the costs for companies of doing nothing could prove much greater.

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