The threat of Bird Flu has far-reaching implications for business.

State of Flux

Alan Day outlines what companies can do to identify risks and protect their supply chains

Share your views on the risk and impact of Bird Flu

Since the middle of 2003, a highly pathogenic avian influenza virus has been infecting animals in South-East Asia and more recently parts of Europe . The World Health Organisation has declared it to be the 'largest and most severe [strain] on record.' Though originally found only in birds, the H5N1 strain, which causes severe respiratory problems, has now affected over 170 humans and in over half the cases the patient has died. The serious concern of health experts is that if this virus mutates and becomes easily transmitted between humans it could cause worldwide devastation.

Why should this matter to you? Imagine, for a moment then, if 30 to 50 percent of your workforce were too ill, unable, or simply unwilling to come into work. Imagine staff on the help desks you?ve outsourced overseas being unavailable due to serious illness. Imagine if your suppliers were unable to send you products due to cross-border trade restrictions. Imagine your customers not able to take delivery of your products because their warehouse staff has been struck with illness. Now imagine this happening in three weeks time.

To many emergency planners, the question is not if the bird flu virus will become a pandemic, but when, and how fast. The issue for your business is assessing your preparation and then mitigating the effects of such a scenario. It is not the case that this virus is happening elsewhere so it doesn?t matter. Unlike a typical natural disaster such as a fire, hurricane, or flooding, the effects of a health crisis in today's global economy cannot be localised easily. While the virus may start widely infecting humans in China , one infected person on an airplane travelling to another major hub airport can unwittingly spread a deadly disease thousands of miles beyond the original source.

This has important and immediate implications for your business. First of all, if your current business continuity scenarios don't cover a world-wide health crisis you must take action immediately. The effects of a health crisis are significantly different than a localised disaster, and must be analysed differently.

Your organisation also needs to evaluate its supply chain. While you may have made adequate preparations, your partners, suppliers, and customers may not have considered the deadly potential of this virus. Any break in the supply chain could have devastating consequences for the entire chain of companies. These breaks could happen for a variety of reasons: a factory must shut down because of an outbreak amongst its workers, or a trucking or shipping company that stops running because of a sudden lack of qualified drivers or merchant seamen. Perhaps one of your key customers must cancel orders because they have no need for your products or services.

Thus, your business must make progress immediately on two tracks: you must ensure you can adapt to a rapidly changing business situation and you must have completed a full evaluation of risk in your supply chain. The first track makes sure that you can respond quickly in the case of a crisis. Some of your companies are in industries where crisis management comes as a second-nature; others need more focused effort to stay flexible.

The second track enables your business to be fully aware of your current risk exposure, and gives you the information necessary to mitigate the risks you are exposed to. The risk of bird flu, a worldwide health crisis, is a unique scenario due to its severity and global impact and should be carefully analysed. Only once both sets of issues have been addressed your company should feel confident it can successfully handle the potential bird flu crisis.

  • What are your opinions on bird flu? European Leaders in Procurement, supported by the supply chain consultancy and research organisation, State of Flux , is hosting an on-line survey to examine what you think of the potential impact of bird flu and how well you feel your company has prepared for it. We invite you to take a few minutes and visit the link below. Responses will be collated and analysed to be published in a future issue.
  • Bird Flu Survey