Recurring Natural Disasters in Contingency Plans - What's the point?

SamuelB

Starting to get Involved
#1
How does the IATF standard expect you to continue production when a disaster such as a cat 5 hurricane decides to tear through your area of production?

Not only could your plant be damaged beyond repair, but there are going to be utility, infrastructural, human and supply disruptions...good luck with producing parts under those circumstances. In this situations, small businesses would be shut down for good.

Not every business has a remote production facility.

Luckily where I live its unlikely that we will ever get a major disaster, but this requirement still does not make sense to me.
 
#2
Seeing as we don't know where you are it's hard to determine whether your statement is entirely accurate, but you can always burn down...Oh wait, that's a disaster!

Any viable business that doesn't have some type of basic contingency plan for adverse events is not being real wise....
 

John Predmore

Involved In Discussions
#3
In my opinion, the expectation of a risk management process is not that you continue production following a disaster, but that your company plan for significant foreseeable risk. If your company is in an area that experiences recurring natural disasters, then that would be an obvious big risk to include in business planning. Your Risk Management strategy, if it is not possible to eliminate a risk, would be to minimize the impact of the incident on stakeholders and external parties (e.g. employees and customers). You called it contingency plans. I think there are ample case studies where having a crisis reaction / recovery plan reduces duration and extent of disruption compared to having no advance plan.

Your plan may be compared to what is considered industry best practices. If the plan is put into action (a disaster occurs) you may be asked to show evidence that the plan was followed. Like all business processes, there should be periodic effort to evaluate and improve the effectiveness of the plan and those efforts should be documented.
 

SamuelB

Starting to get Involved
#4
John Predmore - burning down is not a natural disaster, that's something else. We have plans in place which assume partial plant burn downs, but if we experience a full burn down I don't see how we can continue producing.

IATF should be more clear with their requirements about planning for fires and natural disasters. Good luck in implementing contingency plans when your whole plant is destroyed.
 

Ninja

Looking for Reality
Trusted
#5
burning down is not a natural disaster, that's something else.
I assume you are not in California then...Californians may disagree a bit...

We have plans in place which assume partial plant burn downs, but if we experience a full burn down I don't see how we can continue producing.
Perhaps YOU can't produce...so what will you do?
Contract out to a competitor while you rebuild?
Rent space and equipment from the equipment manufacturer for a time?
Build off-site stock prior to the event and ship from there?
Maintain disaster stock at the customer site?

No plan is going to let you produce in a burnt shell of a building...and you aren't required to...
but you do need to have a plan for staying in business and limiting the impact on external parties.
 

BradM

Staff member
Admin
#6
Samuel... to me, the point of the contingency plan is not to try to identify a potential solution for every potential situation. Meaning, you may not be able to fix everything. But at least you have identified and documented that you won't be able to fix it.

Let's suppose... that it's Jan 2 and in the middle of the night (no one is hurt) your facility is hit by tornado or a fire. What is the plan? On Jan 3 Is everybody just going to show up and stare at the ravaged building? Are the owners just going to take the insurance money and fold up? Or... do they have plans of rebuilding and continuing operations? Are there key personnel? Do you have a plan to pay them something while production is down? Is there a contract firm that could assist with production while you are down?

So it's less about trying to propose magical (and unrealistic) solutions;and more about identifying potential risks, which ones to mitigate, and demonstrating that management agrees with the documented plan as laid out.
 
#7
What's the difference between a fire burning the place down, a tornado tossing it into the next county or 15 feet of flood water? Nothing other than ash vs an empty foundation vs mud.....Disaster is disaster, so either plan for potential consequences or don't...However your insurance carriers, investors and other interested parties may have a thing or 2 to say if not before the fact, definitely after.
 

Johnson

Involved In Discussions
#8
In fact the IATF 16949 doese not requires production during an emergency case, but that requirens an emergency plan, which is guide how to recover your production ( for example, what to be down firstly... and how to ensure the customer production is not effectived (like through air shipment)


How does the IATF standard expect you to continue production when a disaster such as a cat 5 hurricane decides to tear through your area of production?

Not only could your plant be damaged beyond repair, but there are going to be utility, infrastructural, human and supply disruptions...good luck with producing parts under those circumstances. In this situations, small businesses would be shut down for good.

Not every business has a remote production facility.

Luckily where I live its unlikely that we will ever get a major disaster, but this requirement still does not make sense to me.
 

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