Business Continuity and Damage Mitigation

Hurricanes and Nor’Easters can strike any where, at any time leaving a wrath of destruction in their wake.  When Mother Nature shuts down a manufacturing facility, how do you get things up and running again?  Said another way...How do you maintain business continuity and mitigate damage?

Keith Koontz, a Kevin Kennedy Associates’ Lead Consultant and a Professional Engineer (P.E.) with over 25 years of manufacturing, mechanical, and industrial engineering experience as well as project and operations management experience, outlines some of the critical steps.

Assess and document the damages for insurance claims including lost production and business activity valuations.

  • Review damaged equipment and assess the cost to replace or repair, while also considering replacement lead times and production schedules.
  • Perform an assessment of raw materials, WIP, and finished goods as to suitability to use per internal and customer specifications.
  • In medical applications, a review of the potential damage caused by mold or water damage and assessment of selective cleaning and repackaging must be performed while complying with  GMP requirements.

Evaluate the impact of the storm on your supply chain. Determine if your approved suppliers have been affected by the storm or if your logistics chain was broken. Integrate new suppliers as necessary. Consider:

  • Identification of new component supplier.
  • Vendor assessments per company specific criteria and ISO standards.
  • Expedited scale up and incoming quality plans to insure dock to stock to reduce downtime.
  • Possible assembly at new or old suppliers to help reduce confusion during the transition and restart.
  • Storage and handling requirements for inventory and WIP while restarting.

Evaluate the impact of the storm on facilities regarding fulfillment of  product demand and maintaining product quality.

Immediately begin the rapid response planning for physical transfer to alternate production sites which could integrate undamaged production and support equipment. Be prepared by having compiled:

  • CAD layouts for production lines and support operations.
  • Evaluations and plans for site layout and material handling.
  • Coordination with Architectural & Engineering firms.
  • Sources for replacement equipment and alternate sources of personnel if needed.

Address the contingency planning to maintain or ramp up production capacity with reduced employee availability or a spike in demand including:

  • Planning for parallel ramp up of facilities as they become available to include physical equipment and ERP data links.
  • Logistics to move employees to new locations or to bring them to present location or facility.
  • Review of programs to assist in the renewal or replacement of key equipment and facility.
  • Operations planning and budgeting.
  • Customer service and proper notice so as to retain customers and assure them of supply.

Facilitate the temporary transfer of production to other contract manufacturers.  Important factors in that effort are:

  • Selection.
  • Project management.
  • Surveillance audits and management reporting.
  • Review Bill of Materials (BOM) that are critical to this transfer process, drawings, tools, work instructions, skill level assessments, training, and detailed transfer plan.

Evaluate the emergency preparedness of your facility. Look at recovery and emergency plans and identify what worked and what didn’t work.

  • Have you updated your disaster recovery plans? Under ISO this is a critical requirement.
  • How effective was your off-site storage of company critical data? For example, should you store in a different region so that a regional issue doesn’t adversely impact your operations?
  • Did you have a back up electrical or utility plan?
  • Should your plan include a phased shutdown to help recovery operations?
  • In medical and pharmaceutical products, how do you clean out the system if operations are interrupted?

Advanced planning is critical to both avoid and survive the aftermath of powerful storms or ever worse,  natural disasters.  Before your manufacturing company faces disaster, ask yourself…“Have we developed and implemented business continuity and damage mitigation plans?”

 

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