Just as armies test their readiness under fire while hoping they will never go to war, distribution center managers should plan out and test how they will react to events that could interrupt their supply chains.

A panel of logistics experts, including representatives from industry, the military and the American Red Cross, offered suggestions on how distribution centers could prepare for disaster at The Warehouse of the Future conference.

Managers should develop written plans that would aid in restoring normal operations as quickly as possible after disaster strikes, they said. Those plans should include contingencies for all of the major activities the DCs perform. Larger firms may find that they can shift distribution to centers that aren't directly affected by the disaster, but smaller companies will need to find other ways to get around problems, they said.

Keeping utilities up and running is another major concern for distribution centers. As a result, many companies are opting for backup generators and reserve water tanks to prevent interruptions in operations.

Companies should also establish relationships with backup suppliers in case the primary supplier is unable to meet its commitments due to a disaster, said the panel. This is especially important for just-in-time operations, where the proximity of a supplier can be as important as the price of products and components.

The availability of information is critical to a quick recovery, so care must be taken in the storage of information, they advised. Recovery plans should require critical data to be backed up in distant locations, and those plans also should specify procedures for retrieving the data if systems go down. The panelists also suggested that distribution centers should shut down systems to test their contingency plans once each quarter. One way to do that is by eliminating one key element at a time — for instance, a facility could test how it would substitute manual materials handling systems for automated systems.

Finally, the panelists shared their experiences in coping with disruptions caused by the events of September 11. They cautioned attendees against thinking that a similar disaster could happen only in a place such as New York City. Oklahoma City residents can tell you otherwise, they said, and natural disasters can occur anywhere.