How Businesses Survive How Businesses Survive after a Disaster after a Disaster EPI CC – – April 28, 2009 April 28, 2009 EPI CC Fredric Kropp, PhD Fredric Kropp, PhD Monterey Institute of International Monterey Institute of International Studies, Monterey, CA, USA Studies, Monterey, CA, USA fredric.kropp@miis.edu fredric.kropp@miis.edu
Based on work with Based on work with Roxanne Zolin (QUT) Roxanne Zolin (QUT) � How surviving businesses respond during How surviving businesses respond during � and after a major disaster. Journal of Journal of and after a major disaster. Business Continuity & Emergency Planning , , Business Continuity & Emergency Planning (2007) 1(2), 1- -17. 17. (2007) 1(2), 1 � How governments can help businesses How governments can help businesses � weather a cataclysmic disaster. I n n Deborah Deborah weather a cataclysmic disaster. I Gibbons (Ed.), Communicable Crises: Communicable Crises: Gibbons (Ed.), Prevention, Management, and Recovery in Prevention, Management, and Recovery in the Global Arena. Charlotte, NC, Charlotte, NC, the Global Arena. Information Age Publishing, 239- -262. 262. Information Age Publishing, 239 fredric.kropp@miis.edu fredric.kropp@miis.edu
Motivation Motivation � Presentation at USASBE by faculty from a Presentation at USASBE by faculty from a � university in New Orleans university in New Orleans � Roxanne worked at the NPS on a project Roxanne worked at the NPS on a project � with the Center for Stability and with the Center for Stability and Reconstruction Reconstruction � Also colleague of Brian Steckler, NPS, Also colleague of Brian Steckler, NPS, � Hastily Formed Networks Group Hastily Formed Networks Group � r.zolin@qut.edu.au r.zolin@qut.edu.au � fredric.kropp@miis.edu fredric.kropp@miis.edu
The setting – – part 1 part 1 The setting � Post Hurricane Katrina Post Hurricane Katrina - - interviews: interviews: � – “ “Engineering Software, Engineering Software,” ” small firm, 80 small firm, 80 – people in one location people in one location – “ “City University, City University,” ” 17,000 students & 17,000 students & – 1,200 faculty 1,200 faculty – “ “Department of Information Processing, Department of Information Processing,” ” – large IT service provider, 1,500 large IT service provider, 1,500 employees, with counterparts elsewhere employees, with counterparts elsewhere fredric.kropp@miis.edu fredric.kropp@miis.edu
The setting – – part 2 part 2 The setting � In our minds/grounded in In our minds/grounded in � entrepreneurship theory entrepreneurship theory – Different types of entrepreneurs: Different types of entrepreneurs: – opportunity- -based entrepreneurs and based entrepreneurs and opportunity entrepreneurs by necessity entrepreneurs by necessity – Entrepreneurial Orientation (EO) and Entrepreneurial Orientation (EO) and – Lumpkin and Dess (1996) model Lumpkin and Dess (1996) model fredric.kropp@miis.edu fredric.kropp@miis.edu
Entrepreneurial orientation Entrepreneurial orientation (EO), Lumpkin & Dess, 1996 (EO), Lumpkin & Dess, 1996 fredric.kropp@miis.edu fredric.kropp@miis.edu
But first, the story… …. . But first, the story Hurricane Katrina Hurricane Katrina fredric.kropp@miis.edu fredric.kropp@miis.edu
The story continued The story continued � 1325 1325- -2500 dead 2500 dead � � Over 1 million people displaced Over 1 million people displaced � � Untold suffering Untold suffering � � US$80 US$80- -130 billion damage 130 billion damage � � Thousands of businesses destroyed Thousands of businesses destroyed � fredric.kropp@miis.edu fredric.kropp@miis.edu
fredric.kropp@miis.edu fredric.kropp@miis.edu
fredric.kropp@miis.edu fredric.kropp@miis.edu
fredric.kropp@miis.edu fredric.kropp@miis.edu
fredric.kropp@miis.edu fredric.kropp@miis.edu
I mpacts on Businesses I mpacts on Businesses � Loss of people Loss of people � � Inability to communicate Inability to communicate � � Loss of or damage to physical property Loss of or damage to physical property � � Broken supply chain Broken supply chain � � Radical shifts in demand Radical shifts in demand � � Potential severe cash flow problems Potential severe cash flow problems � fredric.kropp@miis.edu fredric.kropp@miis.edu
Loss of People Loss of People � Death or injury Death or injury � � Other priorities Other priorities � � Unable to physically get to or Unable to physically get to or � communicate with work communicate with work � In first hours, personal situation In first hours, personal situation � awareness critical awareness critical fredric.kropp@miis.edu fredric.kropp@miis.edu
Personal situation Personal situation awareness awareness � Assessment of physical well Assessment of physical well- -being of being of � – Individuals: self, employees, families, Individuals: self, employees, families, – other key people in life other key people in life – Home and other personal property Home and other personal property – � Though started in first hours may take Though started in first hours may take � weeks weeks fredric.kropp@miis.edu fredric.kropp@miis.edu
I nability to Communicate I nability to Communicate fredric.kropp@miis.edu fredric.kropp@miis.edu
I nability to communicate I nability to communicate � Hastily Formed Networks group at NPS Hastily Formed Networks group at NPS � dispatched to Mississippi to reestablish dispatched to Mississippi to reestablish contact with military installations. contact with military installations. � HFN mission is HFN mission is “ “to improve the effectiveness to improve the effectiveness � and the efficiency of U.S. and International and the efficiency of U.S. and International Disaster Relief Operations, especially where Disaster Relief Operations, especially where the U.S. is working in collaboration with the U.S. is working in collaboration with NGO, IO, and Foreign Governments.” ” NGO, IO, and Foreign Governments. � www.hfncenter.org www.hfncenter.org; ; � http:// dkms.resiliencesystem.net dkms.resiliencesystem.net/ / http:// fredric.kropp@miis.edu fredric.kropp@miis.edu
Resilience Resilience � the physical property of a material that the physical property of a material that � can return to its original shape or can return to its original shape or position after deformation that does position after deformation that does not exceed its elastic limit not exceed its elastic limit � an occurrence of rebounding or an occurrence of rebounding or � springing back springing back fredric.kropp@miis.edu fredric.kropp@miis.edu
Resilience Resilience � In computer networking: In computer networking: “ “Resilience is Resilience is � the ability to provide and maintain an the ability to provide and maintain an acceptable level of service in the face acceptable level of service in the face of faults and challenges to normal of faults and challenges to normal operation.” ” operation. fredric.kropp@miis.edu fredric.kropp@miis.edu
Department of Defense Department of Defense SSTR SSTR � Stability Stability � � Security Security � � Transition Transition � � Reconstruction Reconstruction � fredric.kropp@miis.edu fredric.kropp@miis.edu
Hancock Medical Center Hancock Medical Center fredric.kropp@miis.edu fredric.kropp@miis.edu
Ability to communicate Ability to communicate fredric.kropp@miis.edu fredric.kropp@miis.edu
Ability to communicate Ability to communicate fredric.kropp@miis.edu fredric.kropp@miis.edu
Loss or Damage to Loss or Damage to Physical Property Physical Property fredric.kropp@miis.edu fredric.kropp@miis.edu
Disaster Contingency Disaster Contingency Plans Plans � Many businesses have them but they Many businesses have them but they � often are ineffective as they can’ ’t t often are ineffective as they can anticipate the scope of the disaster anticipate the scope of the disaster � Never practiced or don Never practiced or don’ ’t have one t have one � � Can Can’ ’t find key decision makers t find key decision makers � � They are not resiliency plans They are not resiliency plans � fredric.kropp@miis.edu fredric.kropp@miis.edu
Engineering Software Engineering Software � No formal disaster plan No formal disaster plan � � Partners operated independently Partners operated independently � – One on reestablishing infrastructure One on reestablishing infrastructure – – One on maintaining client contact One on maintaining client contact – � Maintaining identity key Maintaining identity key – – keeping keeping � website operational website operational fredric.kropp@miis.edu fredric.kropp@miis.edu
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