Archive for February, 2010

Impact of February’s Blizzards

Wednesday, February 17th, 2010
Still Feels Like Christmas

Still Feels Like Christmas

EQECAT, a company that provides risk management and modeling services to the insurance industry, estimated insured losses from the two blizzards that struck the East Coast this month to be in excess of $2 billion. The snow, ice and wind impacts caused businesses to close and additional costs in recovery. The Mayor of New York City, for example, reported that each inch of snowfall imposed $1 million in cleanup costs. So what are the key lessons for small businesses?

  1. Businesses physically removed from the affected area may also sustain storm-related losses. If your business is located in the southern or western states, for example, but you have key suppliers or customers in the eastern states where the blizzards struck, you have to plan for contingencies. One helpful strategy employed by many e-commerce websites was to advise customers of shipping delays on orders owing to erratic weather. It is better to manage the customers’ expectations of prompt delivery beforehand, than to deal with disappointment afterwards.
  2. Plan in advance for telecommuting wherever possible. It is best to keep your employees and customers off the roads, so that they won’t be in harm’s way and the emergency vehicles can do their jobs. This means you should have procedures in place to ensure network security while telecommuting.

And of course, be patient. We are all at the mercy of forces beyond our control and would benefit from humor in dealing with such situations.

Adding Insult to Injury in Haiti

Tuesday, February 16th, 2010

The only thing more horrifying than the human tragedy in Haiti is the so-called “disaster aid” that compounds the suffering of those who have already lost what little they have. Unfortunately, bureaucracy is the first order of relief efforts. USA Today reports that the U.S. Agency for International Development (part of the U.S. State Department) ordered U.S. soldiers to stop distributing food packages to desperate Haitians. However, the troops continued to give bottled water because they were not forbidden to do so. Sound crazy? Not really. Did you know that counselors of our Small Business Development Centers were forbidden to help their colleagues in the Gulf Coast assist their small business clients in the aftermath of Hurricane Katrina? The U.S. Small Business Administration prevented the counselors from crossing state lines. So many counselors went as unpaid volunteers. Bureaucracies have inflexible rules that get in the way of offering help. But had we acted honorably, the Haitians might not today be in such desperate straits. Tageschau Deutschland is reporting that U.S.-backed governments of developing countries received aid that motivated the relocation of the poor to areas particularly prone to natural hazards. Even worse, a public display of aid assistance may be used to weaken demands to accept more immigrants from Haiti to the U.S. where they would have a credible shot at rebuilding their lives. It is sad, but true, that the poorest are the most vulnerable to disasters, whether in the U.S. or overseas and that relief aid more often than not serves the interests of the donors, not the recipients.