Business Plan for a Pandemic?
Tuesday, May 2, 2006
More than half of U.S. companies think there will be a global flu epidemic in the next two years. Two-thirds think it will seriously disrupt their operations as well as foment social unrest. But two-thirds also say they aren't prepared. One-third of executives surveyed say nobody in their organization has been appointed to plan for a pandemic; another one-quarter couldn't or wouldn't answer the question.
"Corporations are looking at this like deer at headlights," said Tommy G. Thompson, who spent much of his last two years as secretary of health and human services sounding the pandemic alarm and is now doing the same as a private consultant. "They are very skittish. They don't know which way to go. They are hoping the car is not going to hit them."
Pandemic influenza is the latest imponderable facing U.S. business, a form of unwanted globalization that threatens the life and health of even the smallest companies in the most literal way.
Several surveys show that a small but growing number of corporations is convinced -- as many epidemiologists have been for a while -- that a global flu outbreak is inevitable. The uncertainty about whether it will be the H5N1 strain of bird flu, which has spread from Asia into Europe, or some other strain is not stopping them from getting ready.
But how ready they are -- and the readiness of the business world as a whole -- is difficult to assess. The government does not require companies to have pandemic response plans, customers don't demand them, and many boards of directors doubt they are necessary.
Thompson, who heads the Deloitte Center for Health Solutions in Washington, estimates that only one in five U.S. companies "are in good position in terms of being able to react -- and even those are going to have to restructure and improve their plans."
In the past year, federal agencies, public health organizations and consulting firms have begun to provide guidance to businesses. One of the larger consultants is Singapore-based International SOS, which provides advice, clinical services and medical evacuations to about 1,000 large corporations and organizations.
In the past eight months, about 220 of its clients have sought help planning for a pandemic. For $5,000 a year, a company can get a 130-page guide, a weekly e-mail newsletter and a monthly Web-based seminar to provide updated epidemiological data and advice. At the high end, some corporations with unusual vulnerabilities, often because they have factories in Asia, are spending up to $40,000 a month for customized planning, said Tim Daniel, an International SOS executive.
"We are now seeing some organizations put together long-term budgets for pandemic planning -- line items for two or three years -- in seven figures per year," he said.
Current models, based on seasonal influenza and the three 20th-century flu pandemics, suggest that a new and highly contagious virus strain would spread across the United States in about five weeks. It would affect communities for six to eight weeks before receding. There would probably be at least two waves, separated by months.
At least a third of the population is likely to become ill in each wave, with peak absenteeism somewhat higher, about 40 percent of the workforce. Depending on the strain's virulence, 900,000 to 10 million people might be hospitalized, and 200,000 to 2 million might die.
Given this scenario, the consultants say, companies should expect that a pandemic will kill some employees, temporarily cripple workforces, sow confusion and fear, and force people to make harrowing decisions between allegiances to work or family. It would make communication difficult, threaten supply chains, and probably interrupt production of goods and delivery of services.