Crisis Management Case Study: Hurricane Sandy and the Fastest Reopening

On the evening of October 29, 2012, Hurricane Sandy came ashore near Brigantine, New Jersey. Before founding Bryghtpath, I led global crisis management, business continuity, and intelligence at Target. Nearly 200 of our stores were disrupted, along with distribution centers, two data centers that powered our e-commerce site, and tens of thousands of employees. This crisis management case study is what I saw from inside that response: what worked, what didn’t, and why the preparation turned into a multimillion-dollar advantage.

The short version: we reopened faster than any of our principal competitors, nobody on our team was hurt, and our after-action review still found about 40 things to fix.

Hurricane Sandy by the Numbers

Sandy was not a powerful hurricane by wind speed. It was an enormous one. The National Hurricane Center’s Tropical Cyclone Report records that:

• Sandy made landfall as a post-tropical cyclone with 70-knot (about 80 mph) maximum sustained winds. Its field of tropical-storm-force winds grew to about 870 nautical miles across before landfall.
• The storm tide at the Battery in Manhattan reached 14.06 feet above mean lower low water, 4.36 feet above the previous record set in 1992.
• Sandy caused 72 direct deaths in the United States, mostly from storm surge, and at least 87 indirect deaths. About 50 of the indirect deaths came from extended power outages in cold weather.
• At least 650,000 homes were damaged or destroyed, and about 8.5 million customers lost power, some for weeks or months.
• U.S. damage was estimated at about $50 billion, which made Sandy the second-costliest U.S. cyclone on record at the time, after Katrina.

Read that list as a business continuity planner and the pattern is clear. The damage came from water and from duration: flooded facilities, power out for weeks, and employees whose own homes were underwater.

Before Landfall: Sharing Plans, Not Just Forecasts

The most important work happened days before the storm. For about three years before Sandy, local, state, and federal emergency management agencies had been building joint planning with the private sector, and retailers and utilities had embraced it.

So the information flowed both ways before landfall. Emergency managers shared storm track updates, road closures, and evacuation plans. We shared our plans for store closures, employee evacuations, where we were pre-positioning recovery supplies, and how we would respond after landfall.

I described it on the podcast this way: “I knew, even though I worked for a private sector organization, that I was not in this fight alone.” That confidence was earned before the storm, not during it. I told the full story on Managing Uncertainty, Episode 126.

Landfall: Tell Executives What You Know, What You Don’t, and When You’ll Know

On the day Sandy came ashore, our CEO called me expecting an update. The honest answer was that we did not yet know the extent of the damage. We would not have access to our New York, New Jersey, and Long Island stores until the next day.

So I told him exactly that: what we knew, what we didn’t, and when we expected to know more. Then I offered him direct access to me for anything he needed.

That structure works for every executive briefing in a crisis. Executives can handle uncertainty. What they can’t handle is silence, or false precision that falls apart by the afternoon.

After Landfall: Ice, Water, and the Public-Private Payoff

Within 24 to 48 hours after landfall, we had significant amounts of ice, water, and recovery supplies at our stores in the affected area, for both donation and sale.

That mattered beyond our own business. FEMA had activated its National Business Emergency Operations Center, and companies were reporting their status into it. That information was consolidated and shared at the highest levels of state and federal government. If emergency managers knew the big-box stores in a community were open and stocked, they could send their own supplies somewhere else. Retail status became part of the government’s resource decisions.

Not every request made sense. At one point FEMA wanted to distribute gasoline in retail parking lots. I didn’t like the idea. But it wasn’t my decision, so I escalated it to the leader who owned that policy. In a crisis, knowing whose decision it is matters as much as knowing the answer.

The underlying lesson is one I repeat often, from a US Northern Command challenge coin: “When you need a friend, it’s too late to make one.” I wrote about it after Sandy in Resilient Communities Need Public/Private Partnerships to Survive.

The Board Story: Nobody Hurt, Reopened First

Our CEO kept the board informed through its normal channels. My team gave him a simple timeline, the impact on our stores and our people, and a day-by-day graph of our reopening rate against our principal competitors. We had the competitor data through an information exchange run by our retail trade association.

The graph showed that we reopened faster than any of them. Business intelligence then put a number on the difference. As I said on Episode 285, it was “a multimillion-dollar advantage in revenue because we were open and they were not.”

But revenue was the second line of the story, not the first. “The most important thing to us and to the board was not necessarily if all of our stores were reopened,” as I put it on Episode 310. The first question was whether anyone was hurt, including employees sheltering at home with their families or returning to damaged neighborhoods.

Nobody hurt, and reopened faster than the competition. That became the CEO’s favorite story to tell the board about resilience. It also answered, for good, the question of whether business continuity was worth the money.

What Didn’t Go Well

Communities, leaders, and the board were happy with the response. Our after-action review still logged about 40 items that didn’t go well.

One example: we had arranged credentialing so our convoys and recovery teams could get into affected areas. It worked in every state but one, where township officials turned away a convoy the state had already cleared. Fixing that took real effort at senior levels of government.

A response that everyone praises still deserves a hard look. If you skip the after-action process because things went well, you will repeat the 40 problems next time, and next time you may not be as lucky.

Five Crisis Management Lessons from Hurricane Sandy

1. Preparation is a competitive advantage. The money we spent on continuity before Sandy came back as revenue after it. Measure your program in those terms when you brief your executives.
2. Build public-private relationships before the storm. Know your emergency managers, your state’s private sector liaison, and your trade association’s information-sharing channels. Exchange plans before landfall.
3. People first, then operations. Account for employees and their families before you count stores. The board asked “was anybody hurt?” before it asked about sales.
4. Know who decides. Pre-define decision rights so that requests like FEMA’s gasoline proposal go to the right owner fast.
5. Run the after-action review, especially when you win. Assign every finding an owner and a date. Then exercise it.

If you are planning for this season’s storms, start with our guide to hurricane planning and Ready.gov’s hurricane toolkit.

Sandy didn’t reward the companies with the thickest plans. It rewarded the ones that had built relationships, practiced decisions, and stocked the shelves before the water came in.

Keep Going

A few ways to go deeper if this was useful.

• Read more. Resilience, crisis management, and continuity writing at Bryghtpath Insights, or the structured Ultimate Guide to Crisis Management.
• Build the response capability. Our Crisis Management services build the team, the decision rights, and the practice that made the Sandy response work.
• Get a maturity score. Our Resiliency Diagnosis® is a standards-based review that produces a maturity score and a prioritized roadmap.
• Talk to us. Set up a call to think through your program with us.