It is tempting to think of pandemic planning as distinct from traditional continuity planning, a one-off exercise requiring one-of-a-kind preparation and response. But because of ever-expanding global trade and the ease and speed of international travel, an avian flu pandemic is one of an emerging class of threats—including those posed by chemical, biological, or nuclear terrorism—that could cause sustained, systemic disruption. Many businesses have yet to factor these nontraditional threats into their continuity plans. As they do, they will find that they are framing a broader, more resilient approach to risk management that can better protect employees, operations, and relationships, even in the face of traditional threats.

If the flu becomes a true pandemic, much of the impact on business will derive directly or indirectly from unprecedented absenteeism. Experts believe that infected people will be contagious for up to two days before symptoms develop, ill for five to eight days (in the absence of complications), and contagious for seven days or more after symptoms go away. During the peak periods, or waves, of a pandemic, companies could experience absentee rates between 15% and 30%, due to sickness, quarantines, travel restrictions, family care responsibilities, and fear of contagion.

Any preparedness plan must address human factors, such as employee education, hygiene, staff movement and evacuation, sick leave policies, and absenteeism. It must also focus on operational issues—managing supply chain and distribution-network disruptions, for instance, and minimizing the interruption of essential services such as electricity, water, telecommunications, transportation, and security. In response to the appearance of avian flu cases in Turkey, the government actually called on law enforcement to protect some hospitals in affected areas from anxious locals who were seeking medical treatment. Such public fear is an underappreciated part of the threat, and companies should anticipate that this type of scenario may occur on a progressively larger scale in pandemic phases four, five, and six.

We will probably see larger and more frequent outbreaks and rapid progress through phases four through six if the virus becomes more easily transmissible among humans. Phase three is the point at which companies should develop risk mitigation plans, testing them with tabletop scenarios and site-level drills, which need to be updated regularly. By phase four, the time for planning has passed, since any plans need to be implemented by then. By phase five, it is far too late to start planning—it is time for intensive strategy execution.

In doing their planning, businesses should look to the WHO’s six-phase pandemic-tracking model, which indicates the WHO’s assessment of the threat. We are now at phase three and have been for more than two years. (See “Tracking a Potential Pandemic” below.)

When companies first began to wake up to the threat of avian flu, such strategies often revolved around trying to stockpile antiviral medication as a stopgap measure, with the expectation that in a pandemic a vaccine would soon become available. It is now clear that antivirals would be in short supply and that viral drug resistance would be likely to develop. What’s more, an effective vaccine may not be available in appreciable quantities for many months after a pandemic is under way, and then shortages and distribution problems could limit use. Contingency planning by forward-looking companies, therefore, is becoming more coordinated, headed by pandemic or crisis teams that tap principal functions, including human resources, operations, security, legal counsel, and communications. This planning focuses on nonmedical risk-mitigation strategies to reduce infection and maintain business continuity.

Current models suggest that the next pandemic is likely to come in three waves, with each wave sweeping across the globe in a matter of weeks and lasting as long as three months. So there needs to be a shift in the nature of continuity planning, away from strategies that protect infrastructure and toward those that protect employees and their ability to conduct business during a sustained crisis.

As companies start to address pandemic preparedness, they are discovering that a pandemic is fundamentally different from other, more traditional business continuity threats and is outside the scope of issues typically considered by continuity planners. Plans are usually designed to help companies respond to localized threats—like fires, bombs, riots, earthquakes, and hurricanes—that affect infrastructure. Once the event has occurred, it is over and, while the effects may linger, recovery can begin. However, a pandemic isn’t an isolated incident. It is, by definition, an unfolding global event. Because of air travel, many cities around the world could be infected almost simultaneously.

Should a pandemic emerge, it would become the single greatest threat to business continuity and could remain so for up to 18 months. Companies need to develop rigorous contingency plans to slow the progress of a pandemic and limit its impact on employees, shareholders, partners, consumers, and communities. This will require more than simply double-checking the soundness of existing business continuity plans.

If the virus does mutate into a form that transmits easily from person to person—and this is the pivotal unknown—in the best case, the World Health Organization (WHO) says, 2 million people could die. In the worst case, according to some experts’ projections, up to 30% of the world’s population could be stricken over the course of roughly a year, resulting in as many as 150 million deaths and perhaps more than a billion people requiring medical care. It takes little imagination to envision the impact this could have on global business as employees fall ill, supply chains fragment, and services fail.

So far, the H5N1 strain of avian flu has infected millions of birds, mostly in Asia, but now increasingly in Europe and Africa; it has spread, with difficulty, to fewer than 200 people—although it has killed more than half of them. And it is evolving in ways that appear to allow it to infect a greater number of species, including pigs, wild and domestic cats, and dogs. From its origin in southern China in 1997, H5N1 has spread to almost 50 countries (at the time of this writing) and is now circulating through Asia, Europe, the Middle East, and Africa. This advance, coupled with the emergence of mutations that may facilitate the infection across species, increases the risk of a global pandemic.

No one knows whether avian flu will evolve into a human pandemic. It could, possibly, remain largely confined to bird populations and be remembered years hence as a scare that didn’t materialize. But little stands between the best- and worst-case scenarios.

An important approach to limiting the spread of avian influenza among humans is to provide the public with the information and tools needed to keep it at bay. All things being equal, the difference between a best- and worst-case global scenario may come down to how well governments, organizations, and individuals control people’s exposure. A pharmaceutical panacea is not likely to be an option.

Should the virus become easily transmissible between people, containing global spread is likely to be extremely difficult. Like the severe acute respiratory syndrome (SARS) virus, H5N1 may evolve into something that’s easily spread through coughing, sneezing, or contact with contaminated hands. Unlike SARS, it may be very hard to control by quarantine if patients are infectious before developing symptoms. In the event of a pandemic, effective antivirals will certainly be in short supply. And because it is not possible to make a vaccine in advance (we need to have the pandemic version of the virus in hand before beginning development), it could be four to eight months after the start of a pandemic until the first vaccines are ready for distribution.

Human illnesses caused by H5N1 follow a particularly aggressive course, often striking children and young adults. Influenza symptoms, including high fever, rapidly develop, often progressing to pneumonia. About half of the people infected with the virus during the past two years have died as a result. The mortality rate has raised widespread concern, although there is no way to know how high the rate would be if a pandemic emerged. For the pandemics mentioned earlier, the mortality rate did not exceed 2%.

That could change. At irregular intervals—three times in the past century—a new influenza subtype that is highly infectious in people has emerged. Up to 50 million people may have died as a result of the 1918–1919 influenza, and millions more died in the pandemics of 1957 and 1968, each of which resulted from virus mutations. A series of mutations or a single genetic reassortment event (a type of gene swapping among viruses) could enable H5N1 to spread efficiently among humans, triggering a pandemic.

If there is anything predictable about influenza, it’s that it has a propensity for change. That’s why health officials are so anxiously watching the avian influenza A (H5N1) virus. The virus readily infects birds and has spread to some other species but so far has shown a limited ability to infect humans. While rare instances of H5N1 passing from person to person have been documented, there is no indication that it can do so efficiently.

Scott F. Dowell, MD, MPH, is a global disease detection officer and Joseph S. Bresee, MD, is the head of influenza epidemiology at the Centers for Disease Control and Prevention in Atlanta.

Finally, many leaders think crisis management is not their job. That’s why they hired risk mitigation and security experts. But creating organizations that are strong in the face of uncertainty requires a new mind-set—and that must be driven from the top down. By developing a culture and mechanisms that support superior adaptive capability, companies will inoculate themselves against a range of threats, not just pandemics. They’ll become more resilient and competitive in the complex and uncertain business of business.

As for the two organizations described in the table, advantage in a crisis will go to the one that can leverage its capabilities and cooperate with other members of the community—even competitors. Companies should think about applying an open-source model to crisis response. Just as they invite partners and competitors to codevelop innovative products, they should look at whether codeveloped crisis responses would be better than proprietary ones. If they’d lose certain capabilities in a crisis and competitors would lose others, are there mutually beneficial opportunities for trade and collaboration?

This is exactly what marine expeditionary forces do, to great effect. One reason the marines are so nimble is that they practice. Companies should do likewise. A firm could establish a globally dispersed group with shifting membership that would devote, say, half a day every other month to engaging in crisis simulations. What would the group do, for instance, if 30% of the company’s factory workforce in Asia dropped out? What if the United States closed its borders? How would the team respond to an “unthinkable” scenario? The goal is not to create specific rules for responding to specific threats but to practice new ways of problem solving in an unpredictable and fast-changing environment.

Companies shouldn’t rely solely on a specialized risk management team to see them through a sustained crisis. What if the team gets taken out? Instead, they need to develop the ability to rapidly evaluate ongoing changes in the environment and develop responses based on simple principles. This means that companies need a global network of people drawn from throughout the organization that can coordinate and adapt as events unfold, reacting immediately and appropriately to disruptions such as lapses in communication inside and outside the organization and losses of physical and human resources. (If a main office overseas suddenly drops out of a company’s network, who is going to jump in?) This network needs to quickly cycle through a process of sensing threats, coordinating, responding, and then sensing again. It needs to engage in creative and collaborative yet disciplined problem solving on the fly, even as members of the crisis network move around or drop out.

I’m not saying that companies should not have comprehensive risk mitigation plans. They should be asking questions about their supply chains and internal organization like, “What’s our response if one component goes down? What’s our response if two components go down? Do we have redundant computer systems?” But just as important, companies need to ask, “What real-time sensing and coordinating mechanism will we use to respond to events we can never fully anticipate?”

Organization 2 is clearly better positioned to respond to evolving, unpredictable threats. We know from complexity theory that following a few basic crisis-response principles is more effective than having a detailed a priori plan in place. In fires, for instance, it’s been shown that a single rule—walk slowly toward the exit—saves more lives than complicated escape plans do.

Consider the organizations described below. Which one would fare better in a sustained crisis such as a pandemic?

Much of the organizational thinking about avian flu, and about crisis management in general, has focused on preparation. Many companies, for example, have created risk management teams to develop detailed contingency plans for responding to a pandemic. This is necessary but not sufficient. In the complex and uncertain environment of a sustained, evolving crisis, the most robust organizations will not be those that simply have plans in place but those that have continuous sensing and response capabilities. As Darwin noted, the most adaptive species are the fittest.

When I travel, I have a growing sense that people worldwide are frightened, hunkering down, worried about grotesque threats—terrorism, environmental degradation—that they can barely articulate. The threat to physical health presented by avian flu could be a chance for leaders to forge a new contract with members of their organizations, acknowledging each member as an asset and, in the process, making it so.

If the flu becomes a plague, employees must be assured that no organizational function is as important as their well-being. A pandemic would be an economic disaster, but it would also be an opportunity for organizations to repair the perception (often sadly true) that institutions no longer care about individual members. In the workplace, loyalty is increasingly seen as a fool’s game. But in the emotionally charged atmosphere of a pandemic, business as usual won’t be possible.

Widespread avian flu would introduce a new level of uncertainty into our already unsettled lives. If the threat escalates, people may be quarantined involuntarily. Whatever their organizational affiliation, people will feel they are losing control. The situation will require tireless, persuasive, optimistic—but factual—communication on the part of leaders. The medium of communication won’t matter much. In some organizations, leaders or their designees may want to start blogging regularly on flu-related matters. The tone of these communications will be critical, however. One of the insidious qualities of a health threat is that it destroys social cohesion. In the face of a deadly disease, people will become fearful of one another. Individuals who have amicably shared office space will begin recoiling every time a colleague sneezes. Genuine leaders will find the words to ameliorate those fears and enable people to remain connected and productive.

Abraham Lincoln is the great American model for this collaborative approach to crisis leadership. As Doris Kearns Goodwin describes in her biography Team of Rivals: The Political Genius of Abraham Lincoln, Lincoln drafted a wartime brain trust of former political rivals. He knew that Edwin M. Stanton had dismissed him as a country bumpkin, but he also believed that Stanton was the secretary of war the nation needed.

If a worst-case scenario unfolds as a result of avian flu, organizations will be stressed in ways that can’t be fully anticipated. As the pressure mounts, people will scrutinize their leaders relentlessly. They will expect their leaders to make smart decisions, yes, but they will also want leaders who have the ability, as Franklin Delano Roosevelt did, to comfort and galvanize them. In operational terms, leaders will need to share power as never before. No organization can afford to be without a succession plan during a pandemic. Some organizations may want to name co-CEOs or copresidents. And every CEO will want to build a team of top-notch people to share responsibility for solving the novel, complex problems that will inevitably arise. This leadership team will be better equipped to solve problems than any individual, and it will provide the organization with bench strength in case the leader becomes ill.

In a continuing crisis—a war or a pandemic—people want a great deal more. They want leaders who strive to unify their followers. They want leaders with Winston Churchill’s ability to articulate the common threat and inspire people to overcome it together. During a long siege, people look to their leaders for hope. Above all, they want those leaders to be individuals who are capable of greatness and who aspire to it.

In a short-lived crisis, followers may be willing to overlook character flaws and settle for a leader who acts quickly and makes the right choices. They may tolerate a leader who acts unilaterally or doesn’t communicate stirringly, as long as he seems motivated by the common good.

Warren G. Bennis is the University Professor and Distinguished Professor of Business Administration at the University of Southern California’s Marshall School of Business in Los Angeles. He is also the founding chairman of the school’s Leadership Institute.

Preparedness: Pandemic Planning Checklist for Businesses

This disaster-preparedness checklist, adapted from one developed by the U.S. Department of Health and Human Services and the Centers for Disease Control and Prevention (CDC), identifies steps your company should take to prepare for a possible avian flu pandemic. Businesses will play an important role in protecting employees and limiting the virus’s effects on the economy and society. Many of the suggestions below will also help in other emergency situations. (The original checklist can be found at http://pandemicflu.gov/plan/businesschecklist.html.)

Pandemic Planning Checklist

Communication: Getting Straight Talk Right by Baruch Fischhoff When people face risks, they want facts that can help them make better decisions, even if they’re getting bad news. Confusing or irrelevant messages can make them uncertain and angry, forcing them to look elsewhere for help. During Hurricane Katrina, for example, some official communications omitted information critical to residents who needed to make choices affecting their immobile loved ones, their pets, and their property. Risk messages backfire when their authors try to spin the truth. In emergencies, spinners might fear that accurate information will incite panic. In fact, research shows that, in crises, ordinary citizens typically respond responsibly, even bravely. The better the information they have, the more effective their actions will be. Managers who ignore the need for frank, focused risk communications can endanger the people they’re responsible for, undermine their own credibility, and force stakeholders—employees, customers, suppliers, and investors—to look for other sources of information. Fortunately, it’s not difficult to get risk communications right. Doing so requires answering three questions. What information do people expect from you? Obviously, employees will want to know about corporate policies regarding health insurance, telecommuting, absenteeism, and hygiene practices (hand washing, use of masks, use of gloves, and so on). Suppliers and customers will want to know whether and how the company will stay open for business. Neighbors and investors will have their own questions. But rather than assume that you know what information your stakeholders need, consult directly with them. This will reduce a common threat to effective communication: misunderstanding others’ fundamental concerns. What does your audience currently believe? It’s unproductive to give people information that doesn’t make sense to them in terms of their existing beliefs. For example, people know that washing their hands reduces infection risk but perhaps don’t know that their usual methods miss their thumbs and fingertips. Similarly, people may appreciate the risk of an individual handshake without understanding how the risk multiplies the more hands they shake. Misconceptions about risk are often easily corrected—but you have to identify them first. Do you have the resources needed to communicate your message? Effective communication requires several capabilities. Fortunately, many organizations already have employees with the necessary skills: people who can learn the essential facts about the risks; people who can communicate with employees, customers, and others, learning about their beliefs and concerns; people who can create solid communications and, critically, test them to make sure they are understood as intended; and people who can disseminate messages once they’re ready. Management’s job is to coordinate this team, ensuring that its members play their assigned roles—and just those roles. Psychologists should not opine on medical facts; disease experts should not push their pet theories of risk behavior; and public relations experts should not put a happy face on things unless the facts warrant it. Effective communication calls for management more than charisma. Managers who follow this disciplined approach can make their firm an authoritative source of trusted information.

Baruch Fischhoff ( baruch@cmu.edu ) is the Howard Heinz University Professor of Social and Decision Sciences at Carnegie Mellon University in Pittsburgh and a member of the Institute of Medicine.

Modeling: Visualizing Your Vulnerabilities by Baruch Fischhoff Valuable as it is as an assessment tool, the preparedness checklist compiled by the Centers for Disease Control and Prevention (CDC) says little about how to approach the problems it frames. How should managers “gauge potential impact on business-related domestic and international travel,” “plan for scenarios likely to increase or decrease demand for [their] products or services,” or “evaluate what employee access to health care services would be”? (See “Pandemic Planning Checklist for Businesses” in this section.) In my work as a decision researcher and risk communication consultant, I’ve found that complex problems such as these, based on uncertain assumptions, are best explored through formal visualization. One way to do this is to draw what are called influence diagrams. A standard tool in decision analysis, influence diagrams challenge you to think clearly about what you know and don’t know. They require you to map explicitly the relationships among the factors shaping a vital event—like absenteeism during a pandemic. And they translate knowledge into a form that can be shared, pooled, and evaluated. I have used this approach with teams working on topics as diverse as hazardous chemicals, space exploration, electricity deregulation, anthrax vaccination, and climate change. Typically, the exercise reveals vague assumptions, incomplete analyses, or missing information—and thus creates opportunities for better problem solving. The model presented below is intentionally simplistic, with a sampling of the factors relevant to businesses planning for a pandemic. It’s meant as an orienting map, which firms can adapt to address their special concerns and circumstances. It shows, in gray ovals (outcome nodes), potential impacts of a pandemic, such as morbidity (incidence of disease), mortality, and health care costs. It shows, in white ovals (chance nodes), factors determining those impacts, such as the rate of spread, medical care, and the extent of absenteeism. And it shows, in orange rectangles (action nodes), interventions that might blunt a pandemic’s effects, such as antibiotics strategies (to reduce flu complications), makeshift hospitals (to distribute health care locally), and barrier methods, like masks and hand washing (to prevent disease spread while maintaining social interaction). Making an Influence Diagram Managers can use this diagram as a starting point for elaborating the factors that concern them. For example, they can specify what business activity means for their firm, then analyze how a pandemic would threaten it and what the consequences of success or failure in responding would be. Those threats include absenteeism and loss of community services (such as utilities, sanitation, and transportation). The major consequences for society if business fails to manage these threats are shortages, non–health care economic costs (such as lost production and productivity), and reduced social resilience. Seeing the big picture allows a reality check on contingency plans. Items that look straightforward on a checklist might prove to have unexpected inputs or require decisions based on information that’s currently inadequate. For example, where the CDC checklist calls on companies to “evaluate what employee access to health care services would be,” an influence diagram could reveal the threats posed by disruptions of public transportation (one community service), inadequate staffing—or nonexistence—of local makeshift hospitals, or employees’ lack of confidence in the barrier methods that could allow people to safely use health services (reducing their compliance). By identifying these items before a pandemic occurs, a firm will increase its chances of limiting their impact, through its own actions or ones it presses government to adopt. Creating a model is not magic. It takes, primarily, a commitment to confronting and thinking clearly about the issues relating a risk (avian flu) to a set of outcomes (morbidity, health care costs, and so on). Much of the utility of modeling is extracted from the process itself—putting a team of managers into a room for a day to haggle over the issues. Better to identify now what you don’t know than to wait to find out.

Baruch Fischhoff ( baruch@cmu.edu ) is the Howard Heinz University Professor of Social and Decision Sciences at Carnegie Mellon University in Pittsburgh and a member of the Institute of Medicine.

Avian Flu Resources The best one-stop resource for managers is Flu Wiki (http://fluwikie.com), a collaborative flu encyclopedia and portal that presents an array of official and unofficial information. Because wikis allow users to edit and add information, the contents of Flu Wiki are continually updated and corrected. (Note the spelling of “fluwikie” in the URL. Alternative spellings will take you to commercial or other sites that we don’t recommend.) Preparedness and response. On Flu Wiki’s home page, click on “Influenza Plans and Surveillance—National and International,” and then “International Bodies,” and you’ll call up the Web sites of global organizations, including the World Health Organization (www.who.org), and a country-by-country list of public health bodies, news reports, and publications with planning and response information. The “WHO Pandemic Preparedness” page, also found under “International Bodies,” is a particularly robust resource. The Centers for Disease Control and Prevention link (on the “Influenza News Sites and Resources” page) delivers you to the CDC’s avian flu page; if you go from there to the CDC’s home page, www.cdc.gov, you can reach the “Business Gateway to CDC Resources,” which includes planning tools for businesses. (See “Pandemic Planning Checklist for Businesses” in this section.) Also on Flu Wiki, under “Pandemic Preparedness,” you’ll find several workplace continuity plans, such as the government of New Zealand’s well-regarded “Business Continuity Planning Guide.” (For more on New Zealand’s approach, see “What to Expect from Government” in this section.) News and other resources. Flu Wiki directs readers to news reports, basic scientific information, and commentary on flu-related legal, ethical, economic, and political issues. The site also hosts discussion forums, RSS feeds, blogs, and multimedia presentations.

Policy: What to Expect from Government by Larry Brilliant When government officials respond to a public health disaster, they’re in a position to either save lives or wreak havoc in ways that no one else can. Working in disease control for the past 30 years, I’ve found that the difference between successful and bungled responses often depends on government competence in three key areas: providing early disease detection, rapidly responding with sufficient vaccines and treatments, and supplying credible information about symptoms and how to prevent transmission. Currently, only governments have the power to ensure that cases of infectious disease are reported promptly and accurately, that policies are in place to make vaccines available, and that good public health practices are widely known and followed. When and after an epidemic strikes, it takes power and authority to help a population return quickly to some semblance of normality. Contrast Hong Kong’s quick killing of more than 1 million chickens in 1997 with China’s failure to find and report cases of severe acute respiratory syndrome (SARS) in 2003. Hong Kong’s fast reflexes preempted a dangerous epidemic; China’s slow response to SARS spread and prolonged the deadly disease. Contrast, as well, Pakistan’s monthly polio vaccination rounds, which virtually eliminated the disease there, with the Nigerian state of Kano’s 13-month vaccine ban, which caused a polio outbreak within the country’s borders that spread as far as Mecca and Indonesia. During the World Health Organization’s successful smallpox eradication campaign that I worked on in the 1970s, leaders and laggards alike were found in national, state, and district governments. In India, state governments ultimately wiped out smallpox in part by using their health, police, and fire departments to stop trains and buses from transporting disease carriers and by closing down hospitals that were disease transmitters. But lackadaisical officials in some districts complicated the effort by failing to contain endemic disease spreaders, creating a checkerboard of infected regions within the country. This example points up the importance of coordinated government responses at all levels. So what should we expect from public officials in the event of a pandemic? The government of New Zealand outlined its own job description regarding health emergencies. The summary is a good template for all governments to follow: Create a preparedness plan. Work to keep the disease out of the country. Stamp it out if it gets into the country. Manage national response during the acute phase. Help the country recover from it. If government does its job, businesses can develop and implement their own preparedness plans more effectively. For example, managers must rely on government at all levels, from local to federal, to tell them how borders will be protected from incoming infected people or animals—and, just as important, under what circumstances suppliers and business-critical personnel will be allowed to cross those borders. Government officials also should set standards for personal hygiene, created and vetted by experts in the areas of infectious disease and risk, that managers can distribute. They should disseminate reliable information about the availability, benefits, and risks of various treatments. Governments should help develop assessment tools that managers can use to determine when essential workers who have been exposed may safely reenter the workforce. Finally, they must help businesses bounce back once a pandemic has subsided by reestablishing essential services and using the various means at their command, including tax credits and loans, to stimulate economic recovery and growth. Executives who live in democracies, especially those who control large multinationals, have not only the political influence but also the responsibility to make government officials do the job they were hired to do and, along with the rest of the electorate, to throw them out if they fail.

Larry Brilliant, MD, MPH ( larrybrilliant@gmail.com ) is the founder and former chairman of the global health project group Seva Foundation, based in Berkeley, California. He has worked for the World Health Organization’s smallpox, polio, and blindness programs and is the executive director of Google.org, the philanthropic arm of Google.

The Law: Limiting Exposure—of the Legal Kind by Peter Susser If an avian flu pandemic strikes, businesses with inadequate communicable-illness policies and response plans could face a laundry list of HR-related legal concerns. Most developed countries have laws designed to protect employees from physical harm at work. In the United States, employees are protected under the Occupational Safety and Health Act, so if an employee becomes infected at work, the employer may face penalties. Meanwhile, labor unions have petitioned the government to issue an emergency workplace standard dealing with pandemic influenza. This call for action, along with the potential for various types of lawsuits (workers’ compensation, invasion of privacy, discrimination, unfair labor practice, negligence), underscores the need for health communication, hygiene, privacy, and leave policies that specifically relate to infectious diseases. The value of such legal preparedness, of course, is relevant to any life-threatening infectious disease, not just avian flu. Education and communication. Companies need to educate employees, in advance, about modes of transmission and symptoms and tell people to inform management if they have been exposed to the virus. Although disability discrimination laws protect employees with covered health conditions, limitations can generally be imposed if there’s a direct threat to the health or safety of others. The manager can judge, ideally with input from a consulting physician, whether the employee should come to work. By the same token, policies need to be explicit about when employees with transmissible conditions will be allowed back. By discouraging potentially infected employees from coming to the office and ensuring that those who are infected stay away, companies protect staff from harm and protect themselves from certain types of legal liability. In either case, it is important to document the relevant communications. Hygiene. Companies also need to be able to show that they have given employees accurate information about ways to prevent the spread of infection—and that they have provided people with the means to act on that information. For example, public health guidelines are specific about the importance of hand washing and how to do it effectively. Be sure to provide disinfectant soaps, and step up disinfectant cleaning of hot spots such as doorknobs, light switches, and elevator buttons. Consider stocking up on disinfectant wipes, disposable gloves, and masks (which could later become hard to obtain), and plan staffing, shift work, and even physical layout changes to minimize contact among employees. All of these measures will help protect workers from infection and help protect you from liability. (Some states, for example, allow additional awards—beyond normal workers’ compensation awards—when injury results from an employer’s “willful” or “intentional” act, which might include failure to provide appropriate protections.) Privacy. In discussions with employees, managers must be mindful of privacy restrictions related to personal health information. Employers should understand what information an employee might be obligated to disclose—likely, anything that could interfere with his or her ability to perform the job’s essential functions or that could increase the risk to coworkers or third parties through workplace contact. Failure to understand such boundaries could expose the company to privacy invasion or discrimination claims. Fortunately, even rigorous privacy rules allow employers to disclose employees’ protected health information to authorities for public health purposes. Leave. Companies should analyze, in advance, their legal obligations to provide employees with leave in the event of sickness or disability. U.S. laws are articulated in the Family and Medical Leave Act, the Americans with Disabilities Act, and state workers’ compensation laws, for example, as well as in individual businesses’ contract and policy language. Companies should also consider under what circumstances they would want to extend or expand benefits and protections, and they should evaluate their level of income protection for employees on leave, perhaps adjusting benefits plans for employees who exceed their sick-day allotment. One important goal is to have policies that encourage exposed or ill employees to remain at home rather than come to work and expose coworkers—and the company—to potential harm.

Peter Susser ( psusser@littler.com ) is a partner in the employment and labor law firm Littler Mendelson. He is based in Washington, DC.

Test Case: A Preview of Disruption by Sherry Cooper If an avian flu pandemic strikes, it will have hugely disruptive effects on global society and the economy. I can say this because I have lived through a mini–test case of such an event: the 2003 outbreak of severe acute respiratory syndrome, or SARS, in Toronto. During its four-month run in Toronto, ending in June, SARS killed fewer than 50 people. Even China and Hong Kong, the two places that were hardest hit by the virus, suffered “only” 648 deaths in total. Compared with the 1918–1919 influenza pandemic, which killed as many as 50 million people, SARS was quite moderate—but it sure didn’t seem that way in the first half of 2003. On April 23, the World Health Organization sent out a warning against all unnecessary travel to Toronto, Beijing, and China’s Shanxi province. Travel to and from Toronto plummeted overnight. At least four major Toronto conventions were canceled, leaving hoteliers holding the bag for more than 50,000 room nights. Overall, SARS cost the city’s hotel industry more than Can$125 million; more generally, the tourism industry in the province of Ontario lost more than Can$2 billion in income and jobs. Toronto’s city life, too, was transformed by the SARS outbreak. More than 15,000 people were quarantined in their homes for ten days. Many businesses, our bank included, designated some essential employees to telecommute in the event that even a single person at the office became exposed to the virus. Mass transit was deserted. Visits to museums, the zoo, theaters, and restaurants declined sharply. In suburban Markham, all 1,700 students and staff in a high school were quarantined after one student picked up the disease from a parent who was a health care worker. By far, the part of Toronto most severely compromised by SARS was its health care system. Because the first reported SARS patient in the area presented no history of contact with pneumonia (his mother, just back from Hong Kong, had died from undiagnosed pneumonia the week before), hospitals did not recognize right away that this was SARS. Thus, they placed infected individuals in double rooms, exposing other patients, their families, care providers, and other frontline workers to the virus. By the end of the epidemic, nearly half of the reported cases were among the health care workers; three of them died. Even though all hospital procedures were reengineered within 72 hours once it became clear we were dealing with SARS, surveillance and infection control were still inadequate. Beyond shortcomings in treating SARS itself, the burden on the health care system caused delays in testing for and treating other illnesses. Patients had to postpone or skip essential treatments such as chemotherapy and radiation. Family doctors and specialists were overwhelmed. I visited a physician who had a sign on his door telling patients to go to the nearest emergency room if they had a dry cough or fever. To avoid risk of infection, many people refused dental work, and many dentists refused patients. Although the impact of SARS on Canadian GDP is difficult to tease out from other factors, the Bank of Canada has estimated that the disease cut second-quarter GDP by 0.6%. Moderate as this estimate sounds, the effect in Toronto was significantly more dramatic, as Toronto represents about 15% to 20% of Canada’s economic activity. The negative economic and social effects of SARS in Hong Kong were even more severe, as it suffered seven times as many cases and fatalities as all of Canada did. During the peak of the outbreak, in the United States—where there were no deaths from SARS—transpacific travel fell 40% below the previous year’s level. It’s clear from Toronto’s experience with SARS that we cannot afford to wait and see what happens before we prepare for the next pandemic. Because of the nature of the virus and the effective responses of global health officials, SARS was short-lived. We will not be nearly so lucky should the avian influenza become a human pandemic.

Sherry Cooper ( sherry.cooper@bmonb.com ) is the executive vice president of the BMO Financial Group and the chief economist for BMO Nesbitt Burns. She is based in Toronto.

Conversation: Staying Connected William MacGowan on Continuity and Communication As a provider of IT infrastructure for some of the world’s largest corporations, Sun Microsystems is a critical enabler of other businesses’ pandemic plans. William MacGowan, Sun’s senior vice president of human resources, spoke with contributing editor Denise Caruso about how his cross-functional planning team is building a continuity plan to keep the global workforce at Sun healthy so that its customers can prepare, too. What has been Sun’s greatest challenge in developing a continuity plan for a pandemic? We have weathered a lot of continuity crises—we had 350 employees in the towers on September 11, we had customers in Hurricane Katrina—but those were isolated crises that had global effects. With flu, the problem itself is global, which creates a unique set of concerns. Linking these new global issues with our current continuity plan presents a very different challenge. What is the company’s advantage? We’re lucky that half of our 38,000 employees already work remotely through our internal iWork@Sun program. This has obvious benefits for keeping workers from infecting one another if a pandemic does hit. What we’ve built is a sophisticated telecommuting system that gives them full, secure access to their desktops whether they’re at home, at the office, or traveling. We’ve also begun presenting the iWork strategy to our customers as part of their continuity plans, starting with more than 80 of our insurance customers. Keeping our customers up and running is good for them and for us, and it contributes to global business continuity as well. How is Sun being innovative in the way it is educating its employees about the threat? We already have an entire internal organization that’s dedicated to online education and training, and we’re using it to develop programs that will improve our response to a pandemic. One challenge has been figuring out how to make the information available in a variety of languages for our employees in other countries. We’ll also use our intranet radio station, WSUN, to inform employees. Radio has several benefits—for instance, as long as you can get to a phone, we can do a show with you as a guest. You don’t need to be sitting at a computer. This could be very useful for getting experts’ advice out to our employees in an emergency. For example, if we saw signs that the World Health Organization was about to move the flu to the next level on its pandemic alert chart, we could have a flu expert call in and broadcast the information to employees within a day. We could also let employees e-mail or phone in questions to the expert; that would personalize the contact. Employees tell us all the time what a difference it makes when the company’s leaders talk to them—they feel they know and trust these guys. In a time of turbulence, you can imagine how important this kind of trust becomes. Would you be willing to give outsiders access to these broadcasts? We haven’t thought about that. But once our plan is fully in place, if it seems like it will be useful, I’ll have no problem putting out the information to the public. We could easily add a link to our external Web site. Also, we’re always interested in exchanging good ideas and information with companies that are further ahead than we are in other areas. What do you think is the weakest spot for business overall that should be shored up before a pandemic strikes? From a business-planning perspective, I’d have to say it’s our dependence on external providers, even down to the basics like electricity and transportation. There’s so much that we take for granted on a day-to-day basis. That’s why companies should be swapping best practices, figuring out how to help one another. We’re all connected. If our customers, partners, and communities continue to function, we’ll all get through this together. A pandemic crosses borders, social strata, religions, and political camps. If we can’t leverage our technology to make a difference in this situation, then shame on us.

Global Impact: All Eyes on China by Wendy Dobson and Brian R. Golden Many scientists assume that China would be the epicenter of an avian flu pandemic, a possibility that would have far-reaching economic consequences. That prospect, while hardly certain, brings into focus the country’s rural areas, where 60% of China’s 1.3 billion people live. Many are farmers whose livelihood depends on poultry and who live in regions with rudimentary public health surveillance and services. But family members often work in industries in nearby centers, and more than 70 million young people from these households provide low-cost labor in urban jobs, staying in city dormitories most of the time but traveling home for holidays and harvests. Mobile subgroups like this one are potential vectors of flu transmission. The spread of flu would reduce their mobility and create labor shortages in urban industries: the manufacturing exports “workshop” (employing young women), the construction industry (employing young men), and tourism and hospitality (which depend on both). Migrants remit around 40% of their earnings to their families, so domestic consumption would decline as their incomes shrank. The urban population would avoid travel, crowds, and shopping, further reducing consumption, as occurred with the far less infectious severe acute respiratory syndrome. Existing avian flu cases, while small in number, have had a high mortality rate (53% since 2003). Because so many of the infected may die, one serious long-term concern about a pandemic is demographic. Garden-variety seasonal influenza is disproportionately dangerous to people with underlying illnesses or with relatively weak immune systems, many of whom are in their fifties and beyond. However, because avian flu can cause immune system hyperactivity, it is also especially lethal in those with the strongest immune systems. Thus, unlike seasonal influenza, avian flu could kill the most productive members of the workforce. This outcome would compound the already apparent impact of China’s 1979 one-child-per-family policy, which has reduced the size of the cohort entering the labor force. The workforce would shrink even faster, putting pressure on China’s inadequate social safety net and on the low real wages that sustain China’s workshop. Fully 90% of China’s exports are manufactured; a quarter of these head to the U.S. market, accounting for a fifth of U.S. imports. Disease in the manufacturing workshop will depress China’s performance as the world’s third-largest exporter because of potential harm to its main customers (the United States, the European Union, and Japan) and to its East Asian suppliers, which provide almost half of China’s imports. The impact will be felt differently by different industries and types of businesses. About 45% of China’s exports are telecom and office equipment, textiles, apparel, or auto parts; most of these items are produced by large foreign-invested enterprises in coastal areas. Such enterprises will fare reasonably well because governments and employers will act quickly to contain disease outbreaks and locate alternative labor. Instead, problems will arise among local parts suppliers and those who produce the other half of China’s manufactured exports. These producers are domestically owned small businesses, operating with thin margins and supplying the parts for the country’s export platforms and myriad consumer goods—leather, plastics, furniture, toys, sports equipment, food—that giant retailers like Wal-Mart then import. Logistical and employment problems, both from quarantines and from the spread of flu, would ripple through international markets to consumers and retailers in the form of higher prices and lower availability, sales, and employment. While devastating, the 1918–1919 flu, which killed up to 50 million people, occurred at a time when events diffused more slowly in some parts of the world. Now that China is so integrated into the world economy, if an avian flu pandemic begins there, the global impact will be immediate.

Wendy Dobson directs the Institute for International Business and is a professor of business economics at the University of Toronto’s Rotman School of Management. Brian R. Golden is the Sandra Rotman Chaired Professor of Health Sector Strategy at the Rotman School of Management and the University Health Network at the University of Toronto; he is also the director of the Rotman Centre for Health Sector Strategy.