Post-Disaster Business Continuity Plan
Promoting Business Continuity Planning
Canon actively promotes post-disaster business continuity planning. Following the directives of the Canon Group Medium-Term Plan for Disaster Prevention Structure Enhancement (2007-2009), instituted in 2006, we are proceeding with phased improvements, such as upgrading the earthquake resistance of older buildings, establishing disaster prevention agreements with local communities, and implementing systems to collect and disseminate information.
Due to the critical importance of our Shimomaruko headquarters in Tokyo, Japan as the home base for all Group operations, we have rebuilt all on-site buildings, established a risk-management facility, installed backup generators, stockpiled fuel, equipment, and supplies, and established a multiplex communication system. Moreover, we set up the Disaster Recovery Center*1 in Toride, Ibaraki Prefecture, to back up information systems to ensure that the mainframe system will operate securely in the event of a disaster.
We have also updated all Group company facilities, setting up emergency communications equipment and support structures, and inculcated a sense of readiness in our employees through disaster-preparedness training.
Also, in regard to our business continuity plan (BCP)*2, the Facilities Management Headquarters has jurisdiction in creating a plan for the initial post-crisis response, while each of the products operations is responsible for creating their own follow-up BCPs.
As a result of these efforts, we achieved 100% of the goals of the Medium-Term Plan by the end of 2009. Taking that into account, we set about strengthening the disaster prevention system at each site and in each division from 2010 onward. Our activities included conducting another risk assessment of the Shimomaruko headquarters building in preparation for an earthquake with an epicenter directly below Tokyo, emergency communications drills using mobile phone messaging, and creating evacuation plans at shift-work sites.
- *1Disaster Recovery Center
A facility prepared for data backup in the event of a system breakdown due to a disaster. - *2Business Continuity Plan (BCP)
A business continuity plan is an action plan that includes measures to provide for the continuation of a minimal level of business in the event of fire or accident, and to restore operations promptly.
Crisis Control Center
Re-strengthening our disaster prevention by learning from the Great East Japan Earthquake
When the Great East Japan Earthquake struck on March 11, 2011, the Earthquake Disaster Recovery Task Force (Task Force Chief: Chairman & CEO Fujio Mitarai; Task Force Assistant Chief: President & COO Tsuneji Uchida; Executive Director: Executive Vice President & CFO Toshizo Tanaka*) was quickly established based on Canon's business continuity plan framework and began working to assess the damage situation, including that of our business partners.
The chief of the task force established a business recovery policy on March 14 that took into account the damage assessment. Based on that policy, and as a result of a concerted company-wide effort, we were able to resume operations spanning development, production and sales at all Group companies and operational sites by the end of April. This speedy recovery from damage that exceeded anything presupposed in the manual was made possible by our daily preparations and flexible response to the situation.
Taking the experiences of that time into consideration, we have been engaged in a number of efforts since the disaster along the theme of "Re-strengthening our disaster prevention system by learning from the Great East Japan Earthquake." We have been working to improve our disaster response by such means as issuing the Earthquake Measure Guideline in September 2011, and have sought to improve disaster prevention awareness through practical drills, such as nighttime evacuation drills and cleanroom evacuation drills.
- *Our Directors at the time
Damage Caused by the Great East Japan Earthquake and Our Recovery Response
The Great East Japan Earthquake, which struck on March 11, 2011, caused power outages, damage to buildings and stoppages in production equipment at three operational sites and five Group companies, including the Utsunomiya Office and Fukushima Canon.
Not only the products operations having the aforementioned operational sites and Group companies, but also those that did not suffer direct damage were greatly impacted by parts and materials supply stoppage or delays from damaged suppliers. In addition, a number of other business continuity issues, such as the worsening power supply situation, arose.
Amid such conditions, each products operation worked to minimize the impact on production by various means, including concentrating inventories and using substitutes. At the same time, we moved to further strengthen the business continuity system by seismic retrofitting and improving the quake resistance of production equipment, as well dispersing through procurement from multiple regions. We also implemented power-saving measures to deal with the power supply situation.
Damage from the Floods in Thailand and Recovery Response
The areas of Thailand hit by floods in the latter half 2011 suffered major damage. The floods also had a serious impact on the global economy.
Canon's inkjet printer manufacturing operations in Ayutthaya were damaged in the floods. We responded to the situation by making efforts at substitute production, both by increasing production at our plant in Vietnam and by bringing our new plant built in Nakhornratchisima to full capacity soon after it went online in November.
Due to the high concentration of factories in Thailand engaged in the production of high-tech parts, such as semiconductors, many businesses were impacted by a tightening of the parts supply chain. Nonetheless, we worked to reach production recovery in a short time by switching to in-house production, finding substitutes, and making other efforts to secure replacement products.
We also set about making structural improvements in line with the above efforts that would allow us to hedge future risk. This involved efforts to diversify our supply chain through such measures as dispersing fixed production, transfering production during emergencies, and redistributing our supply structures, as well as engaging in procurement from a number of regions.
We also took steps toward flood prediction, such as observing the accumulation and release of water at upstream dams, to defend against future flood damage. We worked hard to restore the Ayutthaya plant after the floods receded, and as a result the plant restarted operations in December 2011, and manufacturing of all products was underway again in February 2012.
