- What are Critical Faults?
Critical faults at the organization level are situations that put at risk the organization’s ability to survive the fault. Such faults may be, for instance:
• Safety faults that cause human casualties
• Significant environmental faults that damage natural values and cause damage which is difficult to reverse.
• A fault at a critical link in the production chain that damages the organization’s production capacity.
• Faults resulting in significant financial costs that require, for instance, a recall of all products.
• A long strike.
• Withholding of a raw material from the production chain in a way that disables production.
• A natural disaster.
• And the list is long.
Therefore, an organization that takes its business life-cycle seriously needs to think ahead of the critical faults that put its existence at risk and plan as best as possible how to survive these and how to recovers from disaster back to business as usual.
The cornerstones of preparation for critical faults and disaster situations.
Disaster recovery can be broken down to four stages:
• Vulnerability assessment: relevant disaster scenarios and damage assessments for each scenario.
• Selecting applicable protection measures to reduce vulnerability.
• Recovery assessment disaster recovery and a Disaster Recovery Plan (DRP)
• Business continuity and a business continuity plan.
Additional issues (important, but mostly covered by other channels):
Employee preparedness and immediate lifesaving (usually treated through accordance with legislative requirements, training and drills).
Business continuity and a business continuity plan in case of critical damage within the organization’s supply chain.
We will now examine each item:
Vulnerability Assessment
Damage assessment and analysis of the impact of functional damage are conducted at the following levels:
• Direct safety damage (employees, neighbors etc.);
• Direct economic damage, meaning the loss of economic assets by the organization;
• Environmental damage;
• Damage to business continuity, meaning the organization’s ability to continue selling and providing service to customers;
• Damage to reputation (qualitative only).
To weigh the damage on a uniform basis, the damages are translated to financial costs (including setting a price to human lives). The environmental impact is calculated based on the rehabilitation costs, and the impact to reputation is estimated qualitatively, without financial quantification.
The impact estimation will determine which impacts are considered critical impacts* that require response;
* Critical impact: based on the damage assessment, the organization determines a policy that sets criteria that determine at what damage mean value the impact becomes intolerable for the organization.
Prior to a Disaster
After diagnosing the critical impacts, it is required to provide a detailed solution to these:
• Improving the preventative/protective measures;
• Coming under the umbrella of a disaster recovery plan (the following paragraph below).
Determining protective measures is a complex process. Since there is an “infinite” number of protective measures that can be put in place, and the reality is that there are budget limitations, proportional protection is required (protection that is aligned to the risk).
In any case, protective measures refer to the following four layers of defence:
Procedural layer. Prior planning and built-in preparation.
Preventative layer. Preventative measures designed to prevent escalation from “incident” to “disaster”.
Holding layer. Dealing (automatically/structurally) with a scenario and minimizing its immediate impacts.
Immediate solution. The organization’s preparedness to save lives and minimize damages.
Note: we can provide you, on request, with a presentation explaining what proportional protection is and how it should be implemented correctly.
Disaster Recovery Plan DRP
A Disaster Recovery Plan, DRP, is required to recover from critical impacts on the organization’s general functioning, and each of its structural functions specifically, with intent to minimize the safety, economic and environmental impact, improving business survivability and minimizing impact to the company’s reputation as the incident occurs. Therefore, the plan includes:
1. Providing solution to critical faults (organized, collected and classified in the previous section) in the following manners: suggesting solutions within the organization; suggesting alternatives outside the organization.
2. To set up and define the role of the rehabilitation team (or teams), the function of which is to handle the incident until the organization returns to full function ability. Among other things, it should be determined (in advance) what activities need to be performed in facilities/ structures/ departments that are forcibly shut down.
3. Defined a rehabilitation plan (within the organization’s emergency procedure) so that the passage from saving lives and recovering trapped survivors turns as quickly as possible into a rehabilitation process.
4. Forces and tasks in all aspects of rehabilitation.
5. A task force to manage rehabilitation and defining the team’s roles.
6. Accessories, forms etc. required for efficient task force work.
Note: a DRP plan is meant to be an integral part of the emergency procedures and fit into them. At organizations that have a DRP plan for computerized systems, the same platform can be used as a basis.
Hazmat and recovery from disasters and critical faults
In recent years, Hazmat has conducted:
Risk management for an earthquake (approx. 15 plants in the chemical and food industries sectors).
Risk analysis and DRP for critical systems at the Makhteshim plant, Teva (pharmaceuticals), Bromine Based Intermediates and others.
Dr. Alex Cohen, Hazmat CEO, taught until recently in Haifa University’s MA program for Disaster Management.
The results of the team’s unique work were presented at the 14th international convention on earthquakes and were widely acclaimed (14WCEE Beijing, October 2008). Click here for a link to the article published by Dr. Alex Cohen for the convention.