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The Implications of a Pandemic Flu Outbreak On Businesses in the Global Economy Gayle Jacobs

The Implications of a Pandemic Flu Outbreak On Businesses in the Global Economy Gayle Jacobs Global PRC Associates, LLC. Overview. A Flu Pandemic as a Political Risk Effects of a Pandemic on the Global Economy Impacts on Companies in West Michigan What Are Other Businesses Doing?

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The Implications of a Pandemic Flu Outbreak On Businesses in the Global Economy Gayle Jacobs

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  1. The Implications of a Pandemic Flu Outbreak On Businesses in the Global Economy Gayle Jacobs Global PRC Associates, LLC

  2. Overview • A Flu Pandemic as a Political Risk • Effects of a Pandemic on the Global Economy • Impacts on Companies in West Michigan • What Are Other Businesses Doing? • Case Study: The Intel Corporation • Looking Ahead: The Next Steps

  3. A Flu Pandemic and Political Risk • Background on Political Risk • Businesses face risk on political, economic and sociological levels • Present clashes in Lebanon disrupting UPS shipments • Terrorism and kidnapping on BP-Shell oil pipelines in Nigeria • SARS outbreak in 2003 A transnational health pandemic would have far greater reach and impact on the global economy than any one war, embargo or natural disaster.

  4. Effects on the Global Economy The flow of goods and services thrives with fluid borders. It is greatly impacted by variables such as market demand, logistics networks, the international banking system, technology and at the root of it all, people. What does this mean for your business?

  5. Critical Factors Workforce Shortages of 30-40% (Precautionary) Border Restrictions Affecting Critical Imports Or Sales/Exports Overseas Major Swings in Demand (Ex: Medical Equipment Sales, Consumer Goods) Mfg Plants Factories Call Centers Retail Operations, Stores Logistics: Trucking, UPS, FedEx Dramatic Changes to Your Business Operations

  6. The Domino Effect A supply shortage causes a disruption to production Related goods cannot be produced Ripple effect is felt in other industries, and it compounds Schools close and parents can no longer go to work (at electric company, factory, etc.) Businesses unable to collect revenues to pay their obligations Families lose ability to earn income when wage earners stay home due to child care, fear or illness Consumers cannot pay bills for utilities and other goods

  7. Michigan’s Role in International Trade:$37 billion in 2005 Exports Michigan’s Top 15 Export Markets World Total: $37,584,052 Partner Amount Canada 22,633,157 Mexico 4,193,399 Japan 1,070,898 Germany 1,056,962 UK 715,931 China 697,860 Austria 591,512 France 478,730 South Korea 464,907 Belgium 442,777 Brazil 404,462 Saudi Arabia 396,193 Netherlands 385,685 Australia 369,631 Venezuela 357,334 (In Thousands of USD) ……… Source: The Office of Trade and Industry Information (OTII), Manufacturing and Services, International Trade Administration, U.S. Department of Commerce.

  8. What Other Businesses Are DoingA Case Study: Intel Corporation Intel Corporation, the world leader in silicon innovation, has nearly 100,000 employees in 199 countries. Their 2005 revenues were $38.8 Billion. After the SARS outbreak in 2003 which cost the lives of several of their colleagues in Asia, they aren’t taking any chances with an Avian Flu Pandemic Threat.

  9. A Case Study: The Intel Corporation • Design Responses Around Each Level of the 6-phase Threat Scale • Organize Cross-Functional teams (Preparedness, Regional Response, Travel, Threat Assessment, Corporate Emergency Operations Center) • Start Hygiene Campaign For the Work Place Including Educational Materials and Hand Sanitizer Pumps • Establish Corporate Communication Lines (especially for expatriates) and a Medical Triage Contact Number • Create System to Track Cases of Illness and Severity

  10. The WHO Global Influenza Scale Source: World Health Organization

  11. A Case Study: The Intel Corporation

  12. A Case Study: The Intel Corporation Track and Manage Any Cases In a Case Management System Reproduced with permission of the Intel Corporation, Occupational Health 2006

  13. A Case Study: The Intel Corporation Point of Entry Temperature Screening Reproduced with permission of the Intel Corporation, Occupational Health 2006

  14. A Case Study: The Intel Corporation Above all, communicate with your work force as much as possible. • Roles, Responsibilities and Goals for All Involved • Company Approach Toward Managing the Threat • Employee Instructions At Each Phase on the Threat Scale • Any Situational Updates • Trigger Points • Return Policy for Expatriates Overseas • How To Stay In Touch Once Homebound or Ill • Organizational Contact List • Guiding Principles Throughout All Phases (next slide)

  15. A Case Study: The Intel Corporation Guiding Principles for Intel’s Pandemic Response: • We promote a healthy work environment • We treat people with dignity and respect through communication and transparency • We will minimize the spread of infection by partnering with local governments and public health organizations, such as WHO and CDC • We will implement a staggered deployment strategy based on risk and need at each location/geography • We will maintain business continuity by developing appropriate levels of coordination and contingency planning

  16. Looking Ahead: The Next Steps Utilize tools and resources from this summit Establish a pandemic flu team First goal: conduct an audit of implications for company Challenge: report findings to top leadership within 2 weeks Set measurable goals and constantly monitor progress, get buy-in from corporate level management to ensure involvement Tier employees into layers most and least critical to operations; cross train Tier 2 and 3 staff Hold leaders accountable for progress and compliance Examine supplier and other external relationships and identify alternatives and back-ups Identify where your business is most vulnerable and back up the weak points (e.g. “just in time” inventory)

  17. Looking Ahead: The Next Steps You’ve heard the experts – the next pandemic is not a matter of ‘if’, but ‘when.’ You have a lot of work to do!

  18. Looking Ahead: The Next Steps Consider The Following: On the morning of September 11, 2001 approximately 19,000 employees were working in World Trade Center Towers 1 & 2 and 58,000 people in the entire World Trade Center complex. Following the plane impacts, Tower 1 stood for 103 minutes and Tower 2 stood for only 56 minutes. During that brief time, nearly 17,000 employees evacuated safely. Casualties among building occupants numbered 2,270 (not including the 403 first responder and 157 plane passengers). Roughly 88% survived a mass exodus from two of the tallest structures in the world. The Explanation: Consistent and regular fire drills resulted in an instinctive and orderly evacuation despite conflicting instructions and limited exit routes. WTC disaster training saved thousands of lives that day and is one of the untold success stories of that unforgettable day.

  19. Thank You and Good Luck! For additional copies of this presentation Or the “Looking Ahead” checklist contact: Gayle Jacobs Gayle.Jacobs@globalprc.com (703) 585-7647

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