DISASTERS WREAK HAVOC FOR FACILITY PROFESSIONALS IN THE 1990S

DISASTERS WREAK HAVOC FOR FACILITY PROFESSIONALS IN THE 1990S

DISASTERS have caused numerous problems in the 90s, teaching cruel lessons that many facility professionals have taken to heart. Some of the recent disasters had been anticipated and planned for far in advance, but even with a lifetime of planning, sometimes nothing can be done to prevent nature's wrath. Let's review some of the major disasters of the 1990s, so far.

The Kobe earthquake
On Jan. 17, 1995, the 7.2 earthquake that hit a section of Kobe, Japan, a city of 1.4 million people, shut down power, telephones and hundreds of miles of rail service. An estimated 834,000 households were without gas and 400,000 were without electricity. The quake lasted 20 seconds and snapped vital lifelines to western Japan. The devastation shattered Japan's belief that sophisticated engineering would enable its newer buildings and roads to withstand a major quake.

Perhaps the most visible symbol of the earthquake's power was an elevated highway lying on its side. A variety of design decisions made long ago account for the vast structural damage wrought by the earthquake, which destroyed or damaged at least 20,000 buildings. With damage estimates close to the $100 billion range, the quake is one of the most expensive natural disasters on record. Officials in Kobe estimate that the cost of disposing of all the rubble to be $1 million.

Another problem was the astounding number of homeless that have overwhelmed Japanese agencies. The government says it will take one or two years to rebuild Kobe and return citizens to proper housing. A member of the Japanese Parliament said that the quake taught a cruel lesson in the need for crisis management planning.

The blizzard of '93
Another disaster that took everyone by surprise was the Blizzard of '93. The blizzard was considered the worst storm of the century. The blizzard swept through the United States and Canada and resulted in an estimated $1.6 billion in property damage, ranking it above the $900 million for the California fires and the $1 billion for the L.A. riots.

The storm had a positive impact on some parts of the local economy, while crippling others. Damage was incurred in 24 states and put 21 percent of the nation's carpet manufacturing capacity temporarily out of commission.

The economic loss from days of canceled work and diminished sales over three months time equaled $30 billion, exceeding the $12 billion brought on by the L.A. riots. In Stewartstown, N.H., water supply was lost to homes, businesses, municipal buildings and schools. In Mississippi, 4,111 miles of power lines were knocked down by the weight of the ice. Repairs to power lines were about $100 million.

Although the predictability of weather seems easier than that of earthquakes, the Northeast was not prepared for the numerous storms to stay around for so long. Business disruption is seen as a viable threat, and more facility managers seem to be coming to terms with what-if circumstances on a daily basis. Risk managers must ensure they have procedures for winterizing their businesses.

Hurricane Andrew
Hurricane Andrew swept through Florida on Aug. 23, 1992, destroying 35,000 homes and damaging 30,000. In Homestead, Fla., one in seven businesses closed and never reopened. The hurricane cost insurance companies $16 billion in claims, wiping out 10 small insurance companies. At the time, Andrew was the costliest catastrophe insurers had seen at (sic) since Hurricane Hugo.

The South Florida Water Management District had a long-standing hurricane preparedness plan that enabled the district's personnel and facilities to continue functioning through the storm. Since the mid-80s, the district has take measures to prepare for the inevitable hurricane. The district assisted the state in its disaster response, and immediately began effective recovery activities. The district proved that in a crisis period, risk plans can save time, money and even lives.

One factor that may have softened the business impact of Andrew was the predictability of hurricanes relative to other types of disasters. The hurricane caused more than $10 million in damages to the Burger King corporate headquarters on the shores of Biscayne Bay, but the corporation jumped to its feet with a restructuring plan and began rebuilding within 72 hours after Andrew hit. The company's disaster recovery plan called for securing back-up equipment, establishing data lines, locating an off-site base, getting vital equipment from vendors and relocating to another site.

The Midwest floods
Insurance companies' expenses from the Midwest flood in 1993 reached approximately $285 million. The financial toll of the flood was several billion dollars, but insurance claims were minimal because property insurance policies typically do not cover floods.

The flood damage to metro businesses in Des Moines, Iowa, exceeded $1 billion. The $1 billion figure is based on a flood damage survey of 297 Polk County businesses, which indicated a $182.5 million loss of property, plant and equipment and a $175.7 million loss in projected income.

The floods overwhelmed Des Moines' water supply and cut the city's power drastically. Damage to public systems, including Water Works and Metropolitan Transit Authority was in excess of $150 million.

The World Trade Center bombing
On Feb. 26, 1993, the bomb explosion beneath the World Trade Center sent a shiver of dread through building owners, designers and occupants around the country. Designers who acknowledge that terrorism has not been a major consideration in most office building design are now thinking more should be done to make tall buildings resistant. For example, security in Chicago was tightened in the aftermath of the explosion. Building managers throughout Chicago posted extra guards in their lobbies and parking garages and reviewed their emergency evacuation procedures.

For most of the 55,000 people who work in the Center, one of the nation's premier centers for industries like banking, securities, shipping and accounting, it was a period of hardship and working conditions approaching the bizarre. The disaster caused thousands of hours of lost work tens off millions of dollars of lost business and huge relocation expenses. Many employees of large companies were forced to work out of warehouses.

The bombing of the Center is prompting the rethinking of building design and security practices, although it is hard to prepare for hostile acts in the same way you prepare for disasters such as hurricanes and earthquakes.

The Los Angeles earthquake
The Los Angeles earthquake on Jan. 17, 1994, was not nearly as deadly as the one in Kobe, but many Californians dealt with its effects for a long time. The quake caused $20 billion of damage and disrupted many businesses. Retailers reported heavy damage to some stores and airlines canceled or delayed flights. Calling into and out of the L.A. area was difficult to impossible throughout the day because of the heavy volume of calling. Many department stores suffered structural damage including Sears, Dayton-Hudson Corp. and R.H. Macy & Co.

Power outages swept through much of the area as transmission substations, transformers and power lines went down. As many as 13 million people were without power shortly after the quake. The earthquake rattled others' utilities too, as far north as Alberta and British Columbia. Transportation, airlines and rail lines also were affected. Seven interstates and three state highways were closed. Most newer buildings performed satisfactorily during the quake, but the pattern of damage to facilities was random.

The California brush fires
Before the earthquake, Californians had to contend with horrifying brush fires in late 1993. The toll for the week of wildfires was 868 homes, 198,000 acres and at least $1 billion in damage. The fires prompted a review of building codes in California, especially for homes.

The thread of commonality running through major disasters is that they all strike with little or no warning and many times they are much more devastating than we anticipate. We can't always predict what mother nature or some other force will do to thwart our masterfully conceived plans. But luckily most professionals face problems that not catastrophic and can be planned for and managed.

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