Book Review: “Mastering Catastrophic Risk”

Book Review of Mastering Catastrophic Risk: How Companies Are Coping with Disruption by Howard Kunreuther and Michael Useem, Oxford University Press, 2018

Reviewer: Edward Thomas, Esq; President of Natural Hazards Mitigation Association

This is a truly excellent book which explains through a combination of insightful analysis, based on their years of research; and real world examples, based on interviews with major corporate thought leaders,  how major corporations are actually dealing with the ever changing and ever increasing foreseeable, unforeseeable and unforeseen risks to companies, their reputations and their employees. The authors, who have produced individually and as a team numerous other excellent books on risk management artfully weave their analysis together with these real world examples then produce action orientated and specific checklist of actions corporate managers can take to learn from the experiences of other companies in such a way as to protect their companies from future disruptions due to natural phenomena such as hurricanes and tsunamis as well as terrorist incidents.

 Managing Catastrophic Risk does a particularly excellent job of showing how far huge, Fortune 500 type, European and United States corporations have come in Risk awareness and institutionalizing the internal corporate infrastructure to deal with risk management.

However, it is also quite clear from reading the book that those major corporations are just now beginning to get serious about truly facing the reality of changing and growing risks and preparing to deal with those risks; the authors do not discuss preparations by small businesses and government at any level. Kunreuther and Eseem suggest that one of the principal manners in which business can successfully deal with risk is moving from short sighted intuitive thinking to much longer term thoughtful deliberative thinking; including devoting the necessary time, attention and resources to think about long term risk. Such thought process may well be difficult for increasingly resource starved governments and for small businesses barely struggling to survive. When one considers that small businesses account for fully one half the employment in the United States, and since 1995 have created over sixty percent of the new jobs in our Nation, we need, as a Society, to be extremely concerned about how well these small businesses and local governments are going to perform in understanding risk and dealing with it.

I strongly recommend this book for both the casual reader who wishes a better understanding of how large businesses are dealing with risk, as well as for use by those who wish to begin a deep dive in Risk Management. Leadership in corporate excellence and those who wish to begin to understand the awesome challenge we have dealing with the mounting risk posed by natural and human casused disasters to our Nation and to the World.

For those of you who think they do not have time to read the book, the excellent news is that the authors were interviewed for a really fascinating discussion of the high points of the book on a Wharton School produced podcast. That 23 minute podcast is available [without charge] online at: http://knowledge.wharton.upenn.edu/article/companies-prep-natural-disasters/

If the podcast does not get you sufficiently interested to read the book, Wharton has also produced an excellent four page issue brief that quite neatly captures some, but by no means all the most important, actionable points of this excellent book. That four page Issue Brief is available on line at: https://riskcenter.wharton.upenn.edu/wp-content/uploads/2018/06/Mastering-Catastrophic-Risk_Kunreuther-and-Useem_summary_2018.pdf

The online magazine Working Capital Review has also produced a very short summary of the book, based on material from Oxford University Press. That short summary is available at: http://workingcapitalreview.com/2018/06/disasters-corporate-catastrophe-checklist/

 

 

Meals for PR Hurricane Victims

The Diva cannot recall finding a relevant article in the Food section of the Washington Post, so today is a first. See: Jose Andres’s Riveting “We Fed An Island” Called for a Revolution in Disaster Relief.

José Andrés’s riveting ‘We Fed an Island’ calls for a revolution in disaster relief
with “We Fed an Island,” chef-and-restaurateur-turned-relief worker José Andrés doesn’t just tell the story about how he and a fleet of volunteers cooked millions of meals for the Americans left adrift on Puerto Rico after Hurricane Maria. He exposes what he views as an outdated top-down, para-military-type model of disaster relief that proved woefully ineffective on an island knocked flat by the Category 4 hurricane.

Andrés also points plenty of fingers. At President Trump. At the Federal Emergency Management Agency. At the American Red Cross. At Puerto Rican politicians who let their own people down. No one is spared Andrés’s critical eye, including the chef himself.

Upcoming Webinar

September 13th, 2018 – -Webinar Reminder-
“ADA National Network Learning Session: One year after Hurricane Harvey, How is Houston Making Its Disaster Planning Disability Inclusive?Webinars begin at 2.30pm EDT/1.30pm CDT/12.30pm MDT/11.30am PDT/8:30am Hawaii.
Registration: Free on-line at http://www.adapresentations.org/registration.php
Registration closes at midnight, September 12th, 2018.

 

New GAO Report on 2017 Hurricanes and Wildfires

Another must read:

2017 HURRICANES AND WILDFIRES; Initial Observations on the Federal Response and Key Recovery Challenges.   

Note that this site contains the full report (142 pp.), a short highlights, report and a link to a GAO podcast.

Update on Sept. 5: So far, the Wall St. Journal and CNN printed articles about the report. The WSJ requires a subscription to read but here is the CNN article: Overwhelmed FEMA called on ‘bottom of the barrel’ staff for 2017 disasters, GAO says

Here is the Wash Post article on the report: Hurricanes and wildfires overwhelmed FEMA in 2017, according to new GAO report.

From Bloomberg News: Watchdog Slams FEMA for Puerto Rico Hurricane Response
Agency faulted for lack of preparedness and adequate staff. Report says identify-theft scheme flourished in wake of storms.

“Rethinking Disaster Recovery and Mitigation”

From Rice University and TX A&M: Rethinking Disaster Recovery and Mitigation Funding in the Wash of H. Harvey. This report is 24 pages long. Also cited in the article is the link to their earlier report, Funding Primer, which is 14 pages.

The Diva considers the main report essential reading.  And the figure on page 6 is very important. Your comments are invited.

 

 

How to Write About Extreme Weather

This article is aimed at journalists, but it should be useful to many of us who write for blogs, websites, and other informational outlets. See: Covering extreme weather: What to avoid and how to get it right.

When extreme weather occurs, questions of whether and how climate change contributed to the event loom large. According to Rick Weiss, director of SciLine and past science reporter for the Washington Post, it’s a fraught area, and reporters can easily veer from what the research says.