Hurricane season began June 1 in the United States, and officials predict a total of eight Atlantic storms with three expected to be intense, having sustained winds of more than 111 miles per hour. Monsoon season has begun in India, and Japan recently entered its typhoon season.

Even if you believe your business is located only in areas that are unlikely to be affected by severe storms, it may still face weather-related risks if a supplier on which you rely is forced to suspend production. With today's complex, interdependent, and often global supply chains, it is likely that severe weather will have some effect on your operations.

Understanding the potential danger severe weather poses and preparing for it is the key to managing weather-related risks. Your employees should know what to do before, during, and after a storm hits. To gauge preparedness and protect your people and business, you should be asking the following questions:

• Do I clearly understand my potential natural-disaster losses? How can I mitigate their impact?
• Is there a formal plan in place to manage such risks? How do I inform key stakeholders about policies and procedures?
• Do employees and operations managers know what to do in an emergency?
• How can I continue operations if employees must vacate a facility? How can I determine when it is safe to re-enter?
• How can I manage and minimize the impact on my supply chain?
• What is my post-storm plan?
• Is there a plan in place to effectively communicate with my employees, customers, suppliers, the media, public officials, and the general public?
• Have I established accounting and technical protocols to accurately measure and track the extent of my losses? Can I adequately capture, manage, and report damages?
• Will my current policies sufficiently cover any natural disaster property and casualty claims, including business interruption losses? How can I present my claims to ensure maximum recovery?

To begin to answer these questions, organizations should start with a natural hazards risk assessment to understand the potential impact of severe weather on its business. Computer modeling can be used to analyze and quantify property risks and develop strategies to help mitigate natural hazards.



"We cannot say exactly when or where it will happen, but climatology will eventually right itself, and we must expect a great increase in land-falling major hurricanes."
William Grey, Colorado State University Associated Press, 5/31/2004

Once the risk is properly understood and quantified, organizations should review their business continuity plans and emergency response capabilities to ensure that people know what to do in the event of a storm watch, warning, and emergency — and after the storm hits. Understanding the organization’s insurance assets and being prepared to file claims can also have a significant impact on a company's ability to quickly resume business after a storm hits.

Even if your facilities are not impacted by a storm, your supply chain can be affected by events halfway around the world. You should take steps to identify, quantify, and prioritize critical weather-related risks that may impact your supply network and develop strategies to mitigate the exposure.

With several regions worldwide already in the midst of — or just beginning — the season for severe weather, now is the time to assess your organization's preparedness and ensure your people, facilities, and operations can sustain a weather-related disruption.