Beating Bird Flu, Jed Christiansen explains how

Try to imagine the following scenario: You are a successful manager who has dramatically increased profit margins by slimming down production and storage costs. You now reign over a nearly empty warehouse while products are manufactured in a low-cost country and transported to their destination 'just-in-time' with no surge capacity. Everything is going well. And then avian flu becomes a human pandemic. Many of your own employees are unable or unwilling to travel to the office, your supplier is facing the same problems and can't make deliveries although most shipping and trucking routes have been closed anyway. In addition, the government has imposed a ban on the import and export of goods critical to your business. Suddenly, you are facing severe losses, possibly a shutdown.

This scenario could be just weeks or months away. Every year various strains of influenza cause thousands of deaths worldwide. Around 48,000 people die in the US and UK from influenza-caused illness each year with little attention paid to this statistic.

However, the current focus on bird flu is striking fear in the hearts of emergency planners in governments and companies worldwide.Why should this matter to you? Put simply, the H5N1 variant of Avian Flu is remarkably dangerous to humans. more than 170 people have been infected through contact with diseased birds, and over 100 of them have died. many of its human victims were previously young and healthy, indicating the strain's strength.

If this particular strain mutates and becomes easily spread between humans there is considerable risk of a pandemic outbreak. (In 1918, an outbreak of similar strength killed over 40 million people worldwide in months.) and lean supply chains are particularly at risk because of the modern global expanse of operations and numerous logistical chokepoints. Unlike natural disasters, which have physical and material consequences in a particular city or region, a health crisis can easily span borders without warning.

In today's global economy with heavy traffic across borders, human travel can rapidly spread contagious diseases. Influenza is particularly dangerous as it is highly communicable.

Between illness and absences some companies are estimating that as many as 50% of their employees will not work during a pandemic. While your company may have plans for employees to work at home and maintain operations, have you evaluated the effects of an outbreak to your supply chain?

According to the world health Organisation, "Despite an advance warning that has lasted almost two years, the world is ill-prepared to defend itself during a pandemic."

The keys to survival in a potentially chaotic environment are threefold: an open mind, organisational flexibility and good communications. A company must engage its employees, its suppliers and its customers quickly and consistently in a changing environment. With so many potential problems, a company must remain flexible and have a variety of alternate plans to call upon. As soon as possible, your organisation should take stock of its true level of reparation for a health crisis. Specifically, you must be open to the potential effects in your supply chain. Delaying or ignoring the problem only serves to exacerbate the eventual effects on your business. A business should make a full assessment of the risks in the supply chain and understand the potential impact of an influenza pandemic.

The first step in this process is to trace your supply chain. What countries are involved? Which ports and airports are your products shipped through? where are your warehouses? This should be a relatively easy process.

Next, a business must be creative with their disaster planning as problems won't necessarily erupt in expected places. Your factory in China may stay in operation while the port you use for shipping is suddenly shut down. So make sure you have plans - and back-up plans. These could include moving products through other ports, warehousing them in the country of origin, or closing down production.

Now is the time to examine each link in your supply chain, think about potential effects and set priorities. Delays and problems may exist for days, weeks, or perhaps even months. Make sure your business is ready for as many eventualities as possible.

However, try as we might, there will still be unforeseen problems and responding to these will be key to survival. an organisation must be nimble to successfully navigate a health crisis.

It would be a good exercise for your company to review roles and responsibilities for key individuals throughout your supply chain. As a situation develops, it may be very likely that key managers and problem-solvers throughout your supply chain could be unavailable or  ncapacitated. Your organisation should be clear about what authority is granted to peers and subordinates so that no time is wasted while responding and adapting to a crisis situation.

One potential way to assist your company's flexibility is to set up a group of people from across the organisation to serve as a central information hub in a crisis. whether physically or virtually located together, this 'tiger team' should be able to quickly and easily communicate problems. They should have the authority to enforce changes as well as represent all the functions that the supply chain touches.

Finally, good communication to, from, and across your organisation is vital in a rapidly changing environment. Companies and employees should be extremely proactive in their discussions. With absences likely to occur in your company staff should be prepared to adapt their role and solve problems with unfamiliar partners. Tell staff to 'overcommunicate' to ensure action on problems.

The way to make sure all this actually happens if a crisis comes is simply through leadership from the top. Procurement chiefs should regularly address their department in the midst of a crisis. This could take many forms. for example, a daily e-mail update or teleconference should set the tone for the rest of the organisation.

Since a health crisis such as bird flu is likely to strike suppliers and customers, it would be wise to set up similar daily updates and chains of communication between your organisation and their organisations. Key points for this would include contact lists of people who should be immediately informed of any supply chain problems. (Possibly using the same 'tiger team' of problem solvers discussed earlier would be best for your company). It?s only when problems are communicated quickly that they can they be addressed quickly.

While a global pandemic is obviously a serious risk to your supply chain, treat each day until it occurs as another day to prepare and test your business continuity plans.

Jed Christiansen is a consultant at State of Flux, a supply chain change solutions organisation