Forecasters with the NOAA’s Climate Prediction Center, a division of the National Weather Service, recently announced there is a 60% chance of an above-normal Atlantic hurricane season in 2020. With businesses across the United States already impacted by the challenges of the COVID-19 pandemic, it is of “paramount importance” that they shore up their business resilience strategies in order to minimize the unique risks of the impending tropical storm season.
“Business resilience is of paramount importance for everyone right now – both in terms of personal resilience and operational resilience. We’re in the middle of a global pandemic, and now we’ve entered hurricane season,” said Jack Holt (pictured), consulting director, business resiliency, risk control, CNA. “Some of our insureds are shutdown [because of COVID-19] and are now trying to work on how they can restart successfully as the public health situation and the government guidance around it continues to evolve. We’re getting new information about the pandemic every day, which they’re having to process quickly. That’s a core element of business resilience – being able to get information, endure what you’re faced with, and adapt quickly and efficiently to changing conditions.”
Now, businesses have the added challenge of hurricane season to deal with. When tackling multiple adversities in one go, “preparing in advance” is the key to business resiliency, according to Holt. To address this, CNA has developed a series of checklists – including a hurricane preparedness checklist and pandemic-related tip sheets – to help clients develop business resiliency action plans based on the potential areas of impact to their organizations.
“Business leadership and the risk managers in their organizations are going to have to take all of these checklists and combine them into one response – that’s absolutely key. And then they need to have a very simple decision-making structure,” Holt told Insurance Business. “At CNA, we recently published a document with Leadership Guidance for Response Team Decisions, which gives our clients a very simple structure to follow so they can quickly get the facts they need, find their voice of truth, and make decisions on evolving circumstances during any period of uncertainty.
“It’s also important for businesses to remember that business resilience is not a single plan; it’s a combination of plans and it’s a combination of management disciplines. The ISO standard 22316 [Security and resilience – Organizational resilience – Principles and attributes] lists multiple management disciplines that enable resilience. The four that we tend to focus on for hurricanes are risk management, incident response or incident management, crisis management and business continuity. All of those programs have to come under all of these situations to recover rapidly from any disruption that occurs.”
The NOAA’s prediction of an above average hurricane season should not be cause for panic. Tropical storms happen year after year, so for most companies, the goal is to improve their response after every incident. Most businesses have some experience to fall back on and some lessons learned from past storms.
“New businesses are probably the most challenged during this period, especially in the context of COVID-19,” said Holt. “Those are the companies who probably rely on resources like our hurricane preparedness checklist the most. We create these checklists to give clients some top of line things to think about. We’re encouraging our insureds to really think about business resilience in a simple and concise way. That’s going to be key to successful response and rapid recovery.”