"Everybody with systems thinking is so angry over what is going on..."Yossi Sheffi (professor of engineering systems at MIT) on the Katrina response. Yossi is quickly becoming the global expert on resilient enterprises. Here's an interview with him on NPR. He details the pro-active actions companies took (for example: Walmart and Home Depot) took to mitigate the impact of Katrina. Why did companies move faster and with more foresight than government? Example on the response of Hilton hotels from Business Week:
FRIDAY, AUG. 26 A colleague, David Blitch, hands Sawyers a weather report, saying "Katrina is aiming right for us." With the general manager on vacation, Sawyers tells the staff to offer all comers half-price rates; the $95-a-night fee goes mostly uncollected.
SATURDAY, AUG. 27 Very quickly, half the hotel's rooms are booked up, and many are packed with extra family members. An additional 200 reservations come in. Meanwhile, about 450 employees and their families have taken cots into the health club. By nightfall, Sawyers counts some 4,500 occupants, plus various pets. He cuts off more reservations: "I don't want to overtax our resources."WEDNESDAY, AUG 31 They decide it's time for everyone to leave. Hilton executives arrange for 19 charter buses, paying wary drivers extra to make the trip from Texas.
Yossi's view is that resilient companies have a corporate culture that pushes decision making to the periphery. In Toyota, for example, anybody on the production line can stop the line if they see a problem. This culture of responsibility runs from the top to the bottom. "People in resilient organizations know that when disruption is evident there is no time to go through the bureaucratic processes."While communications technology is important, it isn't enough. Companies must have a culture of communications (horizontal and vertical). Example: Dell. Every two hours managers get a report on their phone about the latest status of PC manufacturing. This is done so everyone can jump in to fix things when they go wrong. Added to a cultural of communications is urgency. When things go wrong, the entire company must participate in the solution. This urgency yields a flexibility that mitigates the need for excess redundancy.