Are you ready for bird flu?

Up to half of large organisations have not adequately prepared for a pandemic, according to research from Deloitte & Touche, so it is time to get your act together.

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Monday morning, 9 a.m. The CEO calls you into an executive meeting as word comes that a full-blown H5N1 avian influenza pandemic is spreading rapidly from Central Asia. Your job: Keep mission-critical IT systems working despite staff absenteeism rates that could reach 40 percent at the height of the pandemic, which is expected to run its course over a period of six to eight weeks.

Supply chain disruptions are expected as countries close their borders, so you can't count on spare parts. With emergency travel restrictions in effect, you can forget about moving staffers between global locations to cope with labour shortages. You also need to enable remote access for an unprecedented number of employees who will either be out sick, caring for ill family members or afraid to come to the office. You have weeks, possibly just days, before the outbreak overtakes one of your major data centres.

Are you ready?

For many businesses, the answer is probably no, according to Stephen Ross, national leader of the business continuity management practice at Deloitte & Touche LLP in New York.

"The vast majority of Organisations have not done anything," he says. Even large companies are playing catch-up. In a Deloitte survey of 163 large companies conducted in December 2006, 48 percent of respondents said their companies haven't adequately prepared for a pandemic. That's 14 percentage points better than the same survey the previous year. But, Ross adds, "While many large companies have begun their pandemic planning efforts, there's still a significantly large number that have not."

Planning resources

These websites contain information that might prove helpful if you're adding avian flu to your business continuity plan.

Why such inaction? A major pandemic hasn't occurred in years, and the probability of an outbreak this year can't be predicted with certainty. That may lull businesses into a false sense of security, but the potential for catastrophic losses makes planning vital, say pandemic experts and business continuity planners. "The impact of this is so high that the risk rating tells you this must be a priority," says Don Ainslie, global security officer at Deloitte.

Not if, but when

"The probability of a pandemic outbreak is [100 percent]," says Michael T. Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota in Minneapolis. It's just a matter of when, he says.

The World Health Organisation has already issued a pandemic alert for the deadly H5N1 virus, although at this point, the virus still isn't able to spread directly between humans. "What we need to do," says Osterholm, "is emphasise to these companies that, unlike many events [such as tornadoes and earthquakes] that may never happen to a company, this is one that will."

A flu pandemic could devastate companies and the world economy. The U.S. Department of Homeland Security estimates that worker absenteeism could reach 30 percent to 40 percent during a pandemic's peak. For a corporation with about 20,000 employees, the cost of lost labour and health care could exceed $60 million, a Deloitte study says.

Supply chain disruptions in one sector, such as the oil and gas industry, could have a domino effect, says Osterholm. According to the Congressional Budget Office, a severe pandemic could cost the U.S. economy more than $600 billion, or about 5 percent of the gross domestic product.

The U.S. hasn't seen a large-scale pandemic since the Spanish flu outbreak of 1918, when one-third of the world's population became ill and at least 50 million people died, according to a government report. In the worst-case scenario described in a WHO report, if H5N1 mutates directly into a human-to-human transmissible form, the mortality rate could hit 60 percent to 65 percent. In contrast, the mortality rate in 1918 was 2.5 percent.

"Obviously, in that kind of worldwide pandemic, it would be as catastrophic as anything we've ever seen or known. We're talking 1 billion -- with a 'b' -- or more deaths," Osterholm says.

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