Pandemic Influenza Planning

1
Pandemic Influenza Planning New Paradigms, New
Approaches

• Preparing, Responding, and Recovering
  Can Your Supply Chain Support it All?

Dr. Doug Himberger Vice President Booz Allen
Hamilton 703-377-1000
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Changes in business over the past few years
have had a dramatic impact on risk management
Business Models
Risk
Risk Transfer

• Characteristics
• More complex
• Network based
• Large, extended enterprises
• High decision velocity
• More stakeholders
• Implications
• Efficiency effectiveness
• Interdependency
• Hidden fragility

• Characteristics
• Pervasive threats
• Geo-complexity is a driving factor
• Historic basis alone is not sufficient
• Implications
• The unthinkable now needs to be addressed

• Characteristics
• More difficult
• Companies inheriting more risk
• Emphasis on controls
• Implications
• Increased focus on complexity
• Government more a partner than ever before

3
These changes can have chilling impacts
on businesses

• 73 of businesses that have a prolonged
  disruption of 10 days or more close or
  suffer long term impact1
• 43 of businesses suffering a disaster never
  recover sufficiently to resume business1
• Of those that do reopen, only 29 are still
  operating two years later1
• Only 32 of 247 top financial executives said
  their companies were able to make major changes
  to their supply chain if needed2, and 38 said
  their corporations were sitting on too much
  unmanaged supplier risk2
• Large companies will face a crisis every 4 to 5
  years2 ... but every company or agency could
  potentially face the pandemic crisis

Source 1 Crisis Management International 2
CFO Research Services
4
One reason operating model complexity
(including the supply chain) has outpaced risk
management practices
Networked
Present State
Distributed
Operating Model Complexity
Resilience Gap
Centralized
Time
Present State
Functional
Risk Management Sophistication
Single Point of Failure
Coordinated
Managing Risk Across the Enterprise
Adaptive
Creating Resilience Across the Enterprise
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Being prepared means effectively closing the gap
through systems-focused Risk Management

• Recognize dynamic aspects of the changing
  landscape
• Identify enterprise risk interdependencies at
  strategic level
• Integrate risk management with mission strategy
  and planning to drive decision support into
  operating model
• Establish a more transparent view of risks across
  the corporation or agency to facilitate key
  trade-off decisions in developing a risk
  mitigation strategy
• Balance efficiencies and effectiveness with
  robustness to meet overall management targets
• Create cross-domain risk management capability,
  business intelligence, and situational awareness
• Assign clear ownerships and responsibilities
  across the extended enterprise
• Develop partnerships wherever possible to share
  mitigate risk

6
Managing risk across the enterprise will help
drive organizational preparedness activities

• A decision support system that systematically
  identifies, quantifies, and measures operational
  risks and their potential impacts from a network
  perspective and provides alternatives to reduce
  the impact of a disruption and return operations
  to normal as quickly as possible is essential
• Pandemic preparedness is not accomplished in a
  vacuum it requires extensive outreach and
  communications as well as constant collaboration
  across jurisdictional and cultural boundaries so
  partnerships are actively established
• Systems-focused, integrated preparedness is an
  opportunity to not only mitigate a possible
  pandemic influenza but to address all massive
  disruptions
• We must not only plan for these risks we must
  act now!

The tasks of the 21st century cannot be
accomplished by a single nation or agency, or
business alone.
President Bush Dec 2004
(brackets inserted not in original quote)