"I think we also have to take seriously that [terrorists] might try during the cycle leading up to the election to do something. In some ways, it seems like it would be too good to pass up for them."
National Security Adviser Condoleezza Rice, Fox News, 4/18/2004
With only a few months to go, security preparations have intensified and are expected to result in major logistical disruptions, affecting residents and businesses alike. Each city is taking its own approach to security and the manner in which routine and unexpected challenges are handled could have a significant impact on the business communities' ability to operate during the conventions.
In Boston, police have already announced week-long transit closures-including North Station and parts of I-93-and a restricted zone around the Fleet Center, where the Democrats will meet. Related security measures, including the training of auxiliary police personnel, are expected to cost approximately $40 million.
Extensive plans are already in the works to protect the party conventions — which have been classified as National Security Special Events. With the designation — a concept that evolved from the 1996 Summer Olympics in Atlanta — comes heightened security coordinated by Homeland Security's Secret Service agency.
Dow Jones International News, 4/20/2004
New York's Mayor Bloomberg has said the city will not close Penn Station, which is adjacent to Madison Square Garden, the location of the Republicans' meeting. However, the rail station might close for several hours if requested by the Secret Service. The city is training 10,000 police officers in emergency response techniques. These and other security measures could cost as much as $65 million.
However, these cost estimates do not account for the impact to businesses where employees, suppliers, and vendors may have trouble accessing offices and delivering expected products and services. In addition, they could be forced to shut down for the week and could suffer even larger economic impacts, should an unexpected incident occur.
"Over 1,000 groups have filed applications for demonstration permits," said Kevin Sheekey, special adviser to New York Mayor Michael R. Bloomberg. "Some are large, some are small. And we've got the people to handle this." The protesters expect opposition to President Bush will lead to big turnouts for their events.
The Washington Times, 3/29/2004
Past weather-related closures, anti-war demonstrations, and other significant events, such as regional blackouts, provide some indication of the extent of possible business interruption during the conventions. Such incidents forced many executives to implement their business continuity and/or emergency response plans. The conventions might well cause the same or greater impact, particularly if there is a terrorist incident or significant public protest.
The question for businesses in both cities: Are they prepared to maintain operations and protect employees in the event of a business disruption during the conventions? When considering organizational readiness, business executives need to be asking themselves:
- Are we prepared to deal with the increased security requirements surrounding the conventions?
- How difficult will it be to travel to and within the city? Will our employees have trouble reaching the office?
- Do we have plans to ensure that the event doesn't disrupt our day-to-day business activities?
- Will our customers or suppliers have trouble reaching our facility? Will we have trouble reaching them?
- How will we communicate with employees if we need to shut down or ask employees to work remotely?
- Are our emergency procedures and policies current? Do they adequately integrate with appropriate federal, state, and local officials and the surrounding community?
- Is our internal staff adequately trained to deal with a security threat or respond to an emergency?
- If there is a threat, do my employees/tenants know and understand our evacuation procedures?
- Are we compliant with best practices for our industry sector?
- In the event of an emergency, do we know how to effectively communicate with internal and external audiences?
"Boston will pay the price for holding a convention at a transportation hub in an age of terrorism, as local and federal officials yesterday detailed their plans to shut down North Station and Interstate 93 during the Democratic National Convention, a double whammy that is expected to affect nearly 1 million drivers and commuters in the last week of July."
The Boston Globe, 4/1/2004
In preparing for the conventions, executives in both cities should consider developing and/or assessing current business continuity and emergency response plans. They need to be aware not only of the security vulnerabilities of their own facilities, especially if located near the convention sites, but also of the range of possible impacts the conventions may have on their businesses as well as on their employees, suppliers, vendors, and customers.
Based on such assessments, executives can make decisions about how best to run their operations during the convention periods. They will then be prepared for any disruption to business, whether due to unmanageable traffic or an unexpected incident.
Planning activities should include the development of communications programs to provide timely and appropriate information to assure different audiences — such as employees, shareholders, clients, analysts, the media, vendors, and the public — that convention-related challenges are being managed effectively. In addition, in the weeks leading up to the conventions, executives should test their evacuation, crisis management, and risk communications plans, ensuring that they are current and take into account any summer absences, new team leaders, chains of succession, and new company management.
To help evaluate and manage their convention-related exposures, executives should consider the following services:
Marsh's Risk Consulting practice has the tools and solutions to assist you in proactively dealing with the conventions in New York and Boston. Working together, we can help you stay ahead of any business interruption or emergency response issues, and manage and recover from them, if a problem arises.
If you have any questions or would like additional information, please contact us.
