On January 30th, the World Health Organization declared the coronavirus a Public Health Emergency of International Concern, signaling concern over the increase in numbers of cases and additional countries reporting confirmed cases. During an RMA Risk Readiness Webinar EXTRA, Stephany Head, Ph. D., who has worked with the federal government and private industry implementing enterprise risk management programs, and who recently co-authored an RMA Journal article on cybersecurity readiness, discussed the distinctive characteristics associated with crisis management planning, with a focus on organizational responses to a pandemic. She also provided various scenarios and a crisis management response-planning framework to help institutions get started immediately.
Pandemic planning, a component of a comprehensive crisis management strategy, is becoming increasingly important to an organization’s survival and continued success in an ever complex global economy. The ability to effectively respond in times of crisis requires an understanding of your institution’s critical infrastructure requirements, an appreciation for the human needs of your organization, and a predefined ability to integrate and use public resources (both on a national and international level). Crisis management extends the normal processes of business continuity management. A crisis event can create multiple issues that evolve over time, requiring unique responses, flexibility in strategy, and interdependence between other organizations and public resources on a national and possibly international scale.
An effective crisis management plan incorporates emergency response, disaster recovery, contingency communications, business continuity, and a clear delineation of key personnel and their spheres of responsibility. Even organizations that are highly advanced in the area of operational risk management need to reconsider its risk management strategies due to the distinctive characteristics associated with crisis management planning.
The outbreak of SARS in 2003 proved that even a disease with a relatively small health impact can have adverse economic implications. An estimate by the Asian Development Bank, the economic impact of SARS was around U.S. $18 billion in East Asia, which comes to around 0.6 percent of their total GDP (ADB, 2003). It is estimated that a modest pandemic lasting over one year might cause a loss as high as three percent of Asian GDP and 0.5 percent of world GDP. In addition to high morbidity and mortality, a pandemic may cause massive social, political, and economic disruption. While no one can predict the impact or duration of the coronavirus pandemic, which already has had a greater impact than SARS, Head stated that she has not seen any signs of organizations who have any preparedness process in place to handle this health crisis.
In light of that, every organization needs a comprehensive crisis management response plan as a component of their business continuity plan. This includes a detailed framework that assesses the risk, establishes governance, develops a response plan, trains employees and key stakeholders, and maintains and improves the plan going forward. Head also shared a crisis management planning checklist that can be referenced during the recording of the webinar.
Join us for upcoming offerings of the Risk Readiness Webinar Series.