As climate change raises the temperature of the Earth, some parts of the United States will see more incidents of extreme precipitation, increasing the likelihood of flooding. If they haven't already, supply chain managers had better start preparing for this eventuality—and that means doing a lot more than buying an extra umbrella to keep at the office, asserts a new paper from the commercial property insurer FM Global.
"Coping with Extremes: The Impact of Climate Change on Extreme Precipitation and Flooding in the United States and How Business Can Prepare Now" presents current data about changes in rainfall in the United States and reviews the leading scientific explanations for why this is occurring. It shows, for example, increases in extreme rainfall incidents in the Northeast, Great Plains, Midwest, and Southeast. The report also urges companies not to wait until a flood occurs to react but to take steps now to reduce the impact of flooding on both their and their suppliers' operations.
"The consensus among the technical community is that [climate change] is happening," said Louis A. Gritzo, vice president and manager of research at FM Global, in an interview. "You need to think about whether your suppliers are located in flood-exposed regions and go the extra mile to protect the integrity of your supply chain."
Previous research by FM Global found that while 90 percent of companies have operations located in regions exposed to floods,
more than 60 percent of the respondents said their organizations were not well-prepared for a flood. This is a mistake, said
Gritzo. He and the report recommend the following steps: