Creating a Culture of Business Resilience: A Role for Local Government, Part 1

This is part one of a two part series. Watch for part two next Monday, September 19, 2011.

Christopher Atkinson

The year 2011 has been marred by historic severe weather
events that catch communities unaware and ill-prepared. This has driven home
the importance of how local governments respond to such events, and the role of
planning and preparedness in assuring community resiliency. Cities and counties
are the primary line of response in emergency management, but the duty goes
well beyond first response. Local governments are increasingly expected to
reduce vulnerability and increase resilience in their communities–to address
concerns raised by individuals and businesses, and to cultivate a culture of
resilience that allows people and organizations to continue after disaster.

Resilience has been defined by de Bruijne, Boin, &
van Eeten in 2010 as “the capacity of something or someone to bounce back to a
normal condition following some shock or disturbance.” Jha defined vulnerability in 2010 as “the
conditions determined by physical, social, economic, and environmental factors
or processes, which increase the susceptibility of a community to the impact of
hazards.” We may think about
resilience and vulnerability in terms of government’s response to hazard
events, like hurricanes, tornadoes, and earthquakes. Given the risk that
communities face, the level of resilience and vulnerability extant in a
community is potentially the difference between a manageable hazard event and a
full disaster. Individuals, and their businesses and communities, vary in their
vulnerability and resilience.

Governments have a responsibility for encouraging
business resilience because they are dependent on the achievement of the
business community. Revenue from business operation, for example, is dependent
on the success of the local business community. If businesses fail, whether the
failure is the result of the business owner, a disaster event, or something
else, the government will not derive needed revenue from business activity. As
Wemple notes in a 2011 Public Entity Risk Institute presentation on challenges
of economic recovery following natural disasters, major employers may move away
from communities that are not disaster-ready, resulting in reduced employment
and secondary impacts on the rest of the local economy. It is in the interest
of local governments to work with business communities before hazard events
strike, to develop a public-private partnership that reinforces the goal of
resilience among local businesses, from small businesses to large legacy
businesses.

A policy response to more and greater hazards is to seek
to decrease the vulnerability of local businesses, to keep a hazard from
turning into a disaster event. Barnshaw & Trainor note in their 2007
chapter “Race, Class,
and Capital amidst the Hurricane Katrina Diaspora” that businesses that
were vulnerable before a crisis event will continue to be vulnerable after the
crisis event. Firms that are more vulnerable will likely never regain their
full pre-disaster capacity. Kramer suggests, in 2009’s Disaster
Planning and Control, that economic development efforts are a
textbook part of long-term disaster recovery at the community level.
Governments can encourage reduction in vulnerability by proactively reducing
economic vulnerability in the local small business population, through
provision of technical assistance to firms and other development programs and
planning for inevitable disaster events in at-risk communities.

Being aware of how differently sized businesses respond
to disaster and how institutional culture can impact, positively or negatively,
business resiliency, may assist in better planning for disaster at a policy
level. Childs (2008), in Prepare for the Worst, Plan for the Best: Disaster Preparedness and
Recovery for Small Businesses,suggests that businesses, and
particularly small businesses, should have well-considered disaster recovery
plans in place to address the concerns they will have in a post-disaster
environment.

Small businesses constitute the majority of all
businesses in the United States, so there are serious implications for public
policy. The Census Bureau has indicated that about 95% of all businesses in the
United States have gross receipts of less than $1 million, and 96% employ fewer
than 50 employees. Small business fortunes are more closely tied to the
individual economic well-being of their owners. If a small business owner is
impacted, the impact may carry through to the business. The personal and
business dimensions of small business ownership are such that the two are
closely linked.

Watch for part two next Monday, September 19, 2011.

Christopher Atkinson recently defended his dissertation
titled “An Evaluation
of the Impact of Local Government Institutions on Business Resilience in
Disaster,” earning the Ph.D. degree inPublic Administration at Florida
Atlantic University. Email: [email protected]

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