Quick Polar Vortex Quiz:
Two fictional flights are scheduled to leave from different cities in the path of a blizzard.
One is grounded because snow closed the airport.
The other airport is open, but the flight is canceled because school is closed and the pilot doesn’t have anyone to watch her children.
Which is costlier?
Avoiding Company Failures
In theory, two canceled flights might incur the same costs (of course a grounded airport means multiple canceled flights which means more losses).
But on a philosophical level, the second example hurts more. Because when that employee can’t show up, you’re no longer dealing with the inevitable fallout of an inarguable natural occurrence; you’re advertising a company failure – and messing with customers’ good will. And that has longer-term implications.
People complain about acts of nature, Polar Vortex certainly included, but they’ll make room for their occurrence. Company failures? Not so much. It’s one thing to be grounded with your peers; it’s a whole other thing to be grounded while watching the rest of the world operate on schedule. The result? Well, picture the disgruntled leisure travelers taking to social media, or the ultra-valued frequent business customers who are about to change airlines.
Explaining Business Continuity Losses to Shareholders
Air travel is a purely hypothetical example (no offense intended), but these types of incidents – where crucial business goes undone because employees don’t have child care or someone to help with an aging parent — are all too common across industries.
There are millions of working parents in this country. On top of that, there are an estimated 44 million in the sandwich generation caring for elderly people. That makes it a sure bet that somewhere, in some company (including yours), someone is wrestling with how to get out the door, every day, all year long; attorneys who can’t be in court; sales people who can’t tend to major accounts; engineers who fall behind on critical launches. And even if you’re not thinking about it…an industry rival is, which means when a surprise happens, whether it’s snow, summer vacation, or a nanny cancellation, you’ll be hung up while your competitor is going strong. And just try explaining that to the shareholders.
Controlling the Costs of Absenteeism
Garden-variety unplanned absences cost employers $2,650 per salaried employee per year. It’s been estimated that in this single winter alone, the Polar Vortex cost employers as much as $5 billion in productivity losses from all those people who stayed home. Some of those losses could have been prevented just by giving employees access to child and elder care in a pinch.
So the pop quiz answer is, the costlier cancellation is the one that could have been prevented. Because it’s a shame to willfully lose out on productivity. And even the most complicated jobs can be completely undone by the simple inability to make it out the door.