Hurricane Katrina killed 1,836 people in August 2005, cost over $80 billion in damage, and flooded 80 percent of the city. Yet analysis — the Hurricane Pam simulation — had revealed the dangers in July 2004.
Before three months had ended in 2008, 23,500 people had become infected with dengue fever in Rio de Janeiro. Thirty had died. Chaos set in, exacerbated by conflicting messages from public officials.
The surge in dengue fever overwhelmed hospitals, causing disruption in medical care and administrative disarray. During the week of April 1, the military had to intervene in the worst-hit areas of Rio by setting up tents with emergency hospital care.
As of April 3, 2008, the epidemic had infected 55,000 people. Deaths totaled 67. Nearly half were children younger than 13.
The dengue outbreak was blamed on several factors. Critically important, though, is that it was not a surprise. Everybody knew it could come. Yet despite that knowledge, the cost in lives, suffering, public funds, and public confidence was greater than it had to be. As President Lula said, “all levels of government have mishandled the crisis.” But how can that happen when everybody knows the danger and the stakes are so high?
The Urgent Need for Learning
Developing countries are not the only ones mismanaging crises. New Orleans, in the United States, is located in an area highly vulnerable to hurricanes, and analysis had shown that the city’s flood protection was inadequate. Hurricane Katrina killed 1,836 people in August 2005, cost over $80 billion in damage, and flooded 80 percent of the city. Yet analysis — the Hurricane Pam simulation — had revealed the dangers in July 2004.
A massive increase in natural disasters is expected due to global warming. As an example, the flooding in Brazil’s Santa Catarina state in 2008 left at least 50 dead and more than 20,000 homeless. The rain-fueled flooding in southern Brazil affected 1.5 million residents and cut off five cities from the rest of the nation. Of course it’s impossible to say that a given disaster is (or is not) the result of global warming. Then again, it’s not likely that global warming is going to make the earth a calmer and more-hospitable place.
According to a study by the World Economic Forum, levels of risk are rising globally. People cannot prevent hurricanes, floods, flu, or mosquitoes. That makes good preparedness that much more important and the inadequacy of current preparedness, in business and govern-ment, that much more dangerous. And we haven’t even begun to talk about man-made crises such as energy blackouts, infrastructure collapse, and industrial accidents.
Caring Isn’t Learning
On July 17, 2007, TAM flight JJ3054 crashed at Congonhas airport in São Paulo, killing all 187 people aboard. The Brazilian Public Safety Ministry attributed the crash to four problems: a failure to close the airport in heavy rain, faulty construction of runways, inadequate alarms in the cockpit, and insufficient pilot training. The August 2007 cover of Exame magazine put it more succinctly: “A country that doesn’t learn.”
Notice the headline was not “a country that doesn’t care.” Countries care about aircraft ac-cidents. They care about dengue fever, hurricanes, earthquakes, pandemic flu, and more. Countries invest in supplies, personnel, and plans. But, based on results, it’s not enough.
We must stop confusing caring with learning and we must stop confusing stockpiles of supplies with preparation. We must stop blaming unskilled people for failing the first time they handle a major crisis. We must stop expecting unskilled people to handle major crises. We must help crisis decision-makers get the skills they need.
How do we help unskilled people become skilled? Experience is critical, but on the-job-training during a crisis is too late. We need to learn not from tragic experience but before tragic experience. Moreover, we must expand our view of what we must learn and who must learn it. It’s not only about first responders practicing moving supplies and equipment. It’s also about senior officials practicing the tough decisions they’re expected to make and coordinate under enormous pressure.
The good news is that it can be done and it doesn’t have to bankrupt us. In fact, it saves money as well as lives.
Preventive action, in terms of long-term investments and policies, is necessary. But money and materiel alone don’t solve mismanagement. The cure for crisis mismanagement is better crisis management skills, and that means helping leaders build the skills they need.
We emphasize that “better crisis-management skills” does not imply replacing managers themselves. We emphasize also that it is unreasonable to expect anyone to manage a crisis well when that person has little or no relevant experience. So, we need to safely create that experience before a real crisis hits. We need to invest in crisis-management skills for those leaders, in government and in industry, in whom we entrust our lives and prosperity. We need to invest in those skills not only because they pay off for us all but also because few people have had real-life experience managing large-scale disasters.
We say crisis management skills because no one knows in advance what crisis he or she will face.
First responders — law enforcement, fire fighters, medics, the military, and so on — have protocols and frequent training. Not so for senior leaders, in business and in government. Like first responders, senior leaders need to practice their crisis skills safely and effectively. Teams of senior leaders with excellent skills can make and coordinate better decisions, under pressure. They can be the heroes who prevent or reduce human and fiscal misery when a crisis hits.
The key is a good, fast, cost-effective, safe way for senior leaders to get the advantages of experience.
Rehearsals are necessary but not sufficient. They highlight certain issues — radios on different frequencies, equipment in the wrong place, even missing keys — but rarely those involving teamwork at senior levels or the massive problems when everything goes wrong. Rehearsing isn’t even practical when the scenario is too big or complex, yet that’s exactly where we most need preparation.
The ideal is for senior leaders to say, “gee, that felt just like the simulator” after they handle a crisis. Which is exactly what some simulation-trained leaders have said after successfully handling a crisis.
Mark Chussil is a founder of Crisis Simulations International, LLC (www.crisissimulations.com). He is also founder and CEO of Advanced Competitive Strategies, Inc. (www.whatifyourstrategy.com). He has published extensively and has lectured and consulted on six continents. He earned his bachelor’s degree from Yale and his M.B.A. from Harvard.
Pedro C. Ribeiro is the founder of Stratech/TheProjectOffice (www.stratech.com.br) specialized in strategy, project, risk management and crisis prevention. A former director of Ernst & Young Consulting, Unisys, and EDS, he has more than 30 years of executive and consulting experience. He holds an M.B.A. from The Wharton School, with specialization at Harvard and MIT, and has presented seminars in Europe, United States and Latin America. Stratech is a partner in Brazil of Crisis Simulations International.