Business Continuity – Where ‘Business as Usual’ is the Goal
Business Continuity – Where ‘Business as Usual’ is the Goal
From typhoons in Guam, earthquakes in Anchorage, blizzards in Chicago, and hurricanes in Hawaii, Matson is no stranger to operational risk. Such incidents have been increasing in frequency and always test our organization’s ability to respond and recover. It is critical that Matson Navigation and Matson Logistics further develop our disaster recovery procedures, including backup plans and business restoration methods, with the goal of minimizing operational impacts of any disruption.
In March of this year, the company announced the creation of a Business Continuity Office with a team of leaders dedicated full-time to guiding our efforts to prepare for and, if necessary, respond to business interruptions, such as system outages, natural disasters, or other disruptive events anywhere in our service network:
- Paula Strano, director, business continuity - Commercial
- Marwan Aiche, principal, business continuity - IT Services
- Lek Friel, manager, business continuity - Operations
- Laurie Doolittle, director, strategic projects
Supporting the team is an executive steering committee representing key functional areas of Matson and comprised of John Lauer, EVP and chief commercial officer; Joel Wine, EVP and chief financial officer; Rusty Rolfe, EVP and president, Matson Logistics; and Rich Kinney, SVP, network operations.
The Business Continuity Office’s broad mandate is to formulate and implement a comprehensive strategy to prepare for and maintain Matson’s operational continuity during any disruption, regardless of the cause. The group will provide a framework to meet Matson’s mission-critical and disaster-related responsibilities if an emergency causes a loss of technology, people, building/geographic location, or critical third-party vendors.
“In 2015-16, Matson began a program called the Systems Outage Plan Initiative, or SOPI, which was focused primarily on how we would handle a system outage of core Information Technology applications,” said Wine.
“We made a lot of good progress, but the pandemic made us realize that we were taking a somewhat narrow view by just focusing on IT system outages. With Matt’s approval and guidance, John, Rusty, Rich and I decided to recalibrate our goals for this program so that it becomes enterprise-wide business continuity management. Each level of the organization needs to be able to run its piece of the company in the event of a significant disruption.”
advisory consultant, MHA Consulting; Michael Herrera, CEO, MHA Consulting.
“As past incidents have shown, business interruptions are an unfortunate and real part of the world we live in,” said Kinney. “Our previous efforts on SOPI helped us weather those earlier incidents, and now our Business Continuity Office will guide us to the next level of preparedness.”
“We’ve accomplished several important goals since the office’s inception early this year,” said Doolittle. “In addition to establishing executive sponsors and a steering committee, after interviewing five outside consulting firms, we selected MHA Consulting out of Glendale, Ariz., to assist us in guiding our organization.”
Working with the Business Continuity Office, MHA conducted a corporate-wide Current State Assessment as a first step. This assessment provides an in-depth review of the capability and maturity of a company’s current Business Continuity, which includes the areas of Crisis Management, Fire & Life Safety, and IT Disaster Recovery programs, based on alignment with industry standards, best practices, and guidelines. The output was a management report outlining findings and recommendations. These were then used to develop an overall, multi-year
business continuity roadmap to guide efforts to increase the sophistication and maturity of Matson’s programs.
“Based on the highest operational risk, Honolulu Terminal Operations and the Phoenix Customer Service Center were chosen as our initial assessment priorities,” said Strano. “The Business Continuity Office, along with MHA consulting, visited both locations, did a thorough walk-through, and interviewed the individuals responsible for key functions at each location.”
Consulting, Lek Friel, and Michael Herrera, CEO, MHA Consulting, conduct a TRA walkaround at the Honolulu terminal.
These activities resulted in an assessment of risks related to each physical location, natural events, operational activities, people, third parties, and technology. Recommendations and mitigation options were identified. In addition, complete Business Continuity Plans were developed for each location’s key functions that are designed to re-establish business unit functionality within desired timeframes in the event of a disruption. In early November and December, tabletop drills were conducted in Phoenix and Honolulu – training exercises designed to expose participants to possible disruption scenarios. These exercises allowed teams to utilize the Business Continuity Plans developed earlier in the year and new Business Continuity Disaster Recovery Kits while identifying areas for improvement.
“The Kits are ready to be used on short notice,” said Aiche. “They include laptops that are secure and loaded with required business software and web shortcuts, plus mobile hotspots that are activated on a flexible, low-cost plan that can be increased during an outage.”
“The drills simulated a baseline scenario of key applications having availability issues and then escalated the situation to increase the scenario’s severity,” added Strano. “Discussions took place regarding what steps would be taken under the circumstances. Additional scenarios were then added requiring the participants to show what they would do in support of their roles if they needed to be conducted manually.”
Participant feedback has been positive, noting that the activity stimulated thinking, identified gaps, and generated a list of opportunities for improvement. These drills will continue periodically and involve greater participation and expanded scope beyond only technical outages.
Over the next two to three years, onsite risk assessments will be conducted at substantially all Matson locations, and Business Continuity Plans will be developed for each functional area. In 2023, the Roadmap calls for 24 assessments to be conducted, along with the creation of Business Continuity Plans and tabletop exercises for the ports of Long Beach, Anchorage, Guam, and Hawaii’s neighbor islands. The Business Continuity Office will also provide a means for all other business functions that do not have comprehensive plans to generate their own Basic Business Continuity Plans.
Key objectives for next year also include broadening the Business Continuity Office’s program governance and deliverables for Crisis and Emergency Management and IT Disaster Recovery.
“While there is no end to this program, I think we’re off to a great start,” added Lauer. “This is a capability Matson must have, practice, and continuously improve upon.
“Business Continuity is an ongoing responsibility, and we’re providing an enterprise-wide implementation program. This isn’t about having a reference book on a shelf somewhere. Every department must know what to do and regularly conduct drills. That ongoing ‘practice’ will ensure that each department is prepared for the day when something happens. That level of preparation is what our customers expect and deserve from Matson.”