Economy of Scale

During a recent facility walk through to determine seismic risk, I had the opportunity to interact with a Fortune 50 facilities representative as he prioritized the need for securing item contents. 

There is a wide variety of approaches companies take in determining risk.  Some hire experts such as Peter Yanev to do an analysis and help guide the organization into an overall business continuity plan based on actual earthquake damage around the world.  In other words, fix what actually will fail.  Some entities have committees with varied backgrounds, who gather up as much information as possible in an attempt to come up with informed decisions.  In these cases, each member may have his or her own bias, and area of assumed risk.   I imagine conversations such as:  “We need to fasten everything worth more than $10,000 with safety straps.”  Or, “We need to fasten everything that is radioactive.”  Or perhaps, “We need to fasten everything in my department”.  Maybe there is one person who maintains, “We need to fasten everything!”

Still, in more cases than not, the decision on what to fasten is left to one person who simply gives it his or her best shot.  On this particular walkthrough, the facilities representative shared three pieces of information that influenced his prioritization process:

1. That item is too big to move in an earthquake.  It IT moves, we’re all dead.
2. That item MIGHT move in an earthquake, but adhesive fasteners aren’t going to hold it – any better than double-stick tape would.
3. We don’t need to fasten that (In this case computer monitors) because they don’t really cost much.

If there are three points every organization should understand, it is these:

1. EVERYTHING moves in an earthquake.  You need to determine if an item moving creates a problem.
2. Adhesive based fasteners can work INCREDIBLY WELL in earthquakes.  The larger the adhesive, the better it works.  The better the adhesive, the better it works.
3. THERE  IS AN ECONOMY OF SCALE associated with earthquake damage.  A company losing 3 monitors may not have an issue.  A company losing 3000 most likely will.  Additionally, if one company loses monitors in an earthquake, it is likely others will as well—and there is likely to be a monitor supply shortage after the earthquake.

 The committee member who says, “We need to fasten everything!” just may have it right.