Swine flu has implications for business continuity

Swine Flu Pandemic Should Focus New Zealand Employers On Business Continuity Management

Most New Zealand companies are poorly prepared for any business interruption caused through a Swine flu pandemic or similar event. This is the view of Ray Andrew, New Zealand Managing Director of Jardine Lloyd Thompson, the long established and respected international insurance brokers who this week have rebranded themselves throughout the world to JLT.

Mr Andrew said that companies should be reviewing their business interruption cover and business continuity plans to assess whether they could carry on in the event of loss of staff members (and thus production), loss of supplier’s services or raw materials, loss of IT services and the consequential flow on effects of any pandemic in NZ or overseas

Swine flu cases numbers in New Zealand currently stand at about 1200, but the figures are much larger in the UK, Australia, Canada, the USA, Spain and other parts of the world, and are increasing daily.

“As a trading nation many miles from our markets, it is critical that we are not disadvantaged further by loss of production or loss resulting from the unavailability of raw materials or loss of on-line documentation, which in turn means companies cannot meet export contracts,” he said.

“New Zealand is the ‘asthma capital’ of the world, and it is people with respiratory problems who are suffering the worst. Most New Zealand companies will have staff who could be at risk to Swine fever, and prudent management should be planning now to consider how best they can cope with the impact of a greatly reduced workforce, caused by loss of people from illness.

“Whilst companies may have business continuity procedures and plans, I wonder how many address a potential crisis situation such as a pandemic?” Mr Andrew asked. “A pandemic can escalate quickly, last for several months and could infect at least 25 percent of the country’s population, according to public health experts at WHO. At the peak, employers could have 75 percent of the workforce absent!”

Recently, the JLT group conducted a poll at a web seminar across its clients globally, which suggested that 80 percent of respondents had “significant problems” in developing their business continuity programme. Among the problems identified were making the plans too complicated, being too ambitious, trying to achieve too much too quickly, and not taking the risk seriously, using a “tick box” approach to simply “get it out of the way!”

Another study in Australia across 66 business organisations and 28 councils highlighted the fact that only 18 percent of councils had documented business continuity plans, and 50 percent of these had never been tested. In the business organisations, only 13.6 percent had business continuity plans and 36 percent of these had never been tested.

“We know that in New Zealand it is a very similar figure,” Mr Andrew stated.

In that study, most organisations claimed they needed to be running again after 24 hours, and a third wanted to be operational within eight hours. Mr Andrew said that was totally unrealistic without detailed business continuity planning. A quarter of those surveyed also had no arrangements for alternative IT facilities, should their current equipment be unusable.

The latest JLT pandemic data coincides with the rebranding of the worldwide group as JLT. The company is already best known informally as JLT in many international markets but the rebranding marks the formal launch of new corporate identity, and a bringing together of various JLT worldwide operations under the one distinctive banner.

“This gives us a fresh look at how we present ourselves to clearly differentiate us from our competitors,” Mr Andrew said. “We have a drive underway for greater collaboration across the group, and within the group internationally. The ‘one brand’ will focus that direction and thinking, both with our clients and within the company.”

JLT’s largest shareholder, the Jardine Matheson Group was founded as a trading company in China in 1832. Jardine Matheson is today a diversified business group focused principally on Asia. Lloyd Thompson was founded in 1981 in London, and obtained full listing on the London Stock Exchange in 1987.

The Group was formed in 1997 by the merger of Jardine Insurance Brokers and Lloyd Thompson Group, combining Lloyd Thompson’s specialist skills in the London market with Jardine Insurance Broker’s international network. Today, the Jardine Lloyd Thompson Group employs more than 5,500 people worldwide.

In New Zealand JLT has offices in Auckland, Cambridge, Hamilton, Wellington and Christchurch. JLT provides risk management advisory and insurance broking services key business segments in New Zealand including the public sector, transport, education, construction sport, affinity groups, corporate and commercial organizations and the bloodstock industry.

ENDS

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