DISASTER RECOVERY PLANNING — EXPECT THE UNEXPECTED

History will show 2005 to be the year that the United States government, particularly its Federal Emergency Management Agency (FEMA), fell asleep at the helm during Hurricane Katrina.

More than six months after the storm that devastated the Gulf Coast, washing away hundreds of thousands of homes and businesses and taking 1,300 lives, former FEMA Director Michael Brown and Homeland Security Secretary Michael Chertoff were among the poster children for the government’s utter failure to react to the tragedy. Blame has been abundant and, ultimately, the saga left a deep scar on the Bush Administration.

This tragic and sorry episode in American history has served as a prime example, on the grandest scale, of the consequences that result when measures are not put into place to mitigate losses and recuperate in short order following a disaster. How to fix what is broken and resume business as usual seems a basic concept to grasp, yet the crown prince nation of the free world allowed countless thousands of people to suffer more than necessary because of inadequate response to the hurricane. Anticipating the worst-case scenario, it seems, may be the best measure to take in formulating a disaster recovery plan for your business.

“The biggest mistake everybody, except us, made with Hurricane Wilma was believing it wouldn’t be a strong storm,” Chris Cavaretti, vice president with Stuart, FL-based Southeastern Printing, notes of the 2005 hurricane. “It was forecast to hit the west coast (of Florida) as a category two and might be downgraded to a category one or a tropical storm by the time it hit us.”

Unpleasant Surprise

Except the hurricane slammed the Sunshine State as a category three, then garnered more strength through the Gulf Stream. How surprised were residents? Some of Cavaretti’s neighbors didn’t even put up storm shutters.

“The biggest mistake people make is taking these storms too lightly,” he says. “People say, ‘Oh don’t be afraid, it won’t be that bad.’ You know what...be afraid, and be prepared for it. Those who did not prepare paid the price.”

Southeastern Printing was a hurricane veteran by the time Wilma hit this past hurricane season. Yet, prior to the “double whammy” of consecutive hurricanes Frances and Jeanne in 2004, the printer had never experienced such a storm. In fact, when Frances rumbled through on Labor Day, Southeastern Printing didn’t really have a recovery plan.

Still, the commercial printing establishment mobilized. Machines were covered in plastic and other collateral was moved to higher ground. Since the company has flat roofs, more than a foot of rain managed to rise over the AC units and find its way in. The rubber membrane on the roof was damaged by winds, allowing water to enter.

The printer did have a generator, which was ordered in advance of Frances, and it was loaded back on a truck and returning to its Texas home when Jeanne arrived. Southeastern literally had the generator parked midway through northern Florida, then returned six hours later when the storm had passed.

The dual storms provided a good measuring stick for the company to evaluate its response methodologies and hammer out an actual prioritized plan that could be enacted in the unlikely event another hurricane rumbled through.

“We sent out a memo to department heads, seeking their input on what we did right and wrong,” Cavaretti explains. “We asked them in October, so it was still fresh in their minds. Over that winter, we compiled everything and came up with a disaster plan. Like buying a snow blower, you hope you never have to use it.”

The plan was to be put to the test when Hurricane Wilma paid a visit to Stuart, FL. The building held up well, as did the plan, based on four primary elements:

* Restore power. Several days prior to Wilma’s arrival, Southeastern contacted Florida Power & Light, stressing it is one of the largest employers in the county and needs to be up and running ASAP. Generators can only do so much, and comforts such as air conditioning are viewed as an unnecessary luxury when primary electricity is gone. No one wants to sweat profusely in a dimly-lit working environment.

* Contact employees. When land lines go down, an extra burden is placed on cellular towers, so not all providers are functioning. A phone tree with redundancies was organized and, in the event employees do not hear from anyone, they are to drive by the plant.

* Repair the building. To aid recovery, supervisors went shopping in advance of hurricane season and filled a large box with supplies, from plastic and mops to flashlights and batteries.

* Contact customers. Equally as important as keeping your clients abreast of any possible damage the printing plant may have suffered is learning the same information about your customers, businesses. Even if their facilities haven’t been drastically disabled, delivering to their city may be problematic or impossible.

“You need the ability to make quick decisions and put your plan into action at the drop of a hat,” Cavaretti remarks. “You may know the storm’s coming, but you don’t really know until three days before if it’s going to hit you or not. So prepare for it. Once you know it’s going to hit you, you have to move and everything else gets put on the back burner. But you still have to get the work out.”

Little Warning

United Litho, of Ashburn, VA, survived Hurricane Ivan in September of 2004, but the storm set off a series of tornados, one of which shot across the printer’s parking lot, tore off much of the roof and tossed automobiles against the side of the building. Though the company suffered roughly $500,000 worth of damage, fortunately there were no injuries.

Being a member of The Sheridan Group, United Litho was compelled to have a disaster recovery and contingency plan that is updated annually, notes Wayne Peterson, vice president of sales and marketing. The plan covered about 80 percent of the impact felt by United Litho, and the balance was implemented into the plan and shared with member companies.

The United Litho plan incorporates many of the same aspects of the Southeastern Printing contingency, including:

* A comprehensive contact list for employees of United Litho and members of The Sheridan Group.

* Disaster guidelines and procedures for the following situations—severe weather, fire, bomb and terrorist threats, and a corporate travel crisis plan.

* Insurance contacts, information and forms, and specific instructions on who to call and when.

* Information recovery: how to access information backed up offsite. This includes customer and job planning information, and internal data including financial and accounting information. The company relies on its own IS and IT people to manage offsite backups.

* Outside contacts, from equipment manufacturers to the company that designed the building, HVAC people and electricians. Information is kept on suppliers, vendors and customers.

Deceptive Practices

Keeping clients informed of your recovery is essential, even to the point of providing needless detail, for one never knows when a competitor could be attempting an end-around.

One of Peterson’s competitors called a United Litho customer and pointed out that the tornado destroyed the printer and caused it to go out of business. The customer told the competitor that the information was downright false and asked him to never call back.

“Had we not been incredibly proactive on the customer information side, I don’t think we would have had the same experience,” Peterson says. “We chose to over-communicate to a significant degree.”

The only thing United Litho couldn’t factor into its recovery plan was how its employees would react under the pressure of a crisis. Peterson was overwhelmed to see 70 people show up the following morning, a Saturday, to help pitch in however they could, from grabbing a broom to driving around town in a pickup truck in search of postal pallets that had been scattered by the winds.

“They did everything imagined, mostly without being asked,” he says. “Employee response was amazing.”

Hurricane Wilma also did considerable damage to H&D Graphics, of Hialeah, FL, with about half of the upper roof layer covering the 100,000-square-foot facility torn off and another 35 percent partially removed and heavily damaged by water.

Debris punctured some portions of the roof completely, allowing massive amounts of water to enter the building during the storm’s peak. Incredibly, the company’s two-ton main air circulation fan—bolted to the roof—was ripped off and tossed 50 yards toward the front of the building. The fan took out six air conditioners along the way, damaged eight others and, for the final touch, punched a hole in the roof where it landed.

Ceilings, floors and floor coverings, walls, furniture and computers suffered substantial water damage, and the plant was left powerless for 10 days. According to John Ahearn, president of H&D (a member of the Nationwide Graphics chain), it took 18 days to become fully operational again.

Ahearn notes that the company’s recovery plan survived two earlier hurricanes, but was taxed to the extreme by Wilma. Among H&D’s preventive measures unique to the aforementioned plans:

* Equipment was disconnected from its power source.

* Sandbags were placed at the base of all garage-style doors.

* All company vehicles were parked inside the building.

* All job files for work in process were gathered in preparation for whatever steps would be necessary to complete them when the storm subsided.

“Being part of the Nationwide network put committed sister companies and financial assets at our disposal, enabling us to work our way through the disaster quickly and efficiently,” Ahearn remarks.

H&D’s workers went above and beyond the call of duty, according to Ahearn, sharing resources such as food, water and gasoline during the cleanup process. Some toted in their own generators to aid the plant, elements that can’t be factored into a plan.

The lone flaw Ahearn found in the plan—and an extremely difficult issue to remedy—was H&D’s inability to transfer jobs to sister plants because of the lost power, impassable roads and a severe shortage of gasoline. Compounding matters, all of the local member plants were also impacted by the storm and not operational for a period. Again, the company’s resourceful and determined employees helped mitigate the difficulties.

“The thing that saved H&D Graphics from the catastrophic problems...was the storm preparedness component of our disaster plan,” he says. “We knew what we had to do to protect our most valuable assets, and we prioritized our action plan according to equipment and materials required. Everybody did their part, and although our building was severely damaged, equipment damage and inventory losses at H&D were minimal compared to what could have happened in a storm as violent as Wilma.”
Friends in High (Northern) Places

What do you do when you have an annual report due to be shipped in a matter of days, and a hurricane is barreling its way toward you? Besides panic? Just ask Chris Cavaretti, vice president of Southeastern Printing in Stuart, FL.

The report had to be filed with the Securities and Exchange Commission by the 15th of the month. The glamor section had already been printed, and the 10K information arrived just ahead of Hurricane Frances. Clearly, the job would not be completed prior to the storm’s assault.

“We started calling printers that we knew, but people couldn’t get the paper (45-lb. stock),” Cavaretti explains. “I’m originally from Buffalo and was asked if I knew anyone good. There was only one person I trusted in this situation.”

In a matter of one day, Southeastern arranged the printing, binding, paper delivery and the shipping of the glamor section to Buffalo. Southeastern’s owner even traveled to Buffalo in order to proof it on-press. The job was printed in Buffalo at Dual Printing, bound at The Riverside Group of Rochester, NY, and shipped to New Jersey. Mission accomplished, with a day to spare. No sweat.

“It’s very important to have friends around the country,” Cavaretti advises.