Floods in Thailand Cause Earnings Caution by Apple

Recent flooding in Thailand has caused damage to Nimec, who....Nimec the worlds largest hard drive supplier.  It controls up to 80% of the parts used in hard drives.

It shows the problem of not having back up suppliers for critical parts required by your company. 

Does your company rely on one vendor for key parts or services, do you have plans if something happens to them out of your control?

You can read about the hard drive problem here.

Business Continuity Insurance Claims from Japanese Earthquake Revelations

Original estimates for claims for business interruption resulting from the Japanese earthquake and nuclear disaster ranged from a low of 5 billion to a high of 15 billion.

The insurance industry now says claims will be around the 5 billion mark, as they did not have to pay on some of the biggest claims, like Apple Computers who claimed $500 million.  Why did they not have to pay?  Why did Apple claim such a large amount?

Apple was set to launch the IPad2 in the 3 weeks that followed the earthquake, they had business interruption insurance as many of the critical parts needed to fulfill the orders for the Ipad were made in Japan.

Much of their claim was denied though, because parts could also be made at other manufacturers...but most interesting was one critical part was made at a factory that was in the evacuation zone of the nuclear reactor, so the part could not be made.  Why were they not covered for this?

The insurer says that the supplier was not "physically" damaged by the earthquake, they were just made to evacuate, and the policy did not cover that apparently.

You should work very closely with your insurance broker to see, including the fine print, what sort of scenario's are and are not covered by your policy if you have one.  (P.S. get it in writing).

You can read more about it in this insurance industry article here.

Risk and Disruption - NFC Chip and Cash

You are about to have a new partner.....this new partner is going to take their cut right off the top of every payment made to you right at the point of purchase.

Who is this new partner......well the fight is on for who it will be, but the coming of the new NFC (near field chip) is here, and will be here in waves.

Combatants include, Google, Visa, Banks, Cable Company's, phone companies, mobile phone companies, smart phone makers, apple computers, everyone wants a piece of your cash, they want a percentage and to charge you transaction fees.

The NFC chip is designed as a unique identifier chip that will be tied to  everything from your visa accounts, your debit account, your loyalty card accounts, your anything to do with cash accounts.

All you will need to do to make a payment is to wave your phone near a reader and the payment will be made.....but who gets a transaction fee for that?  The cell phone company, Visa, in Toronto in anticipation of the fees Rogers Cable is applying to open their own bank so they can control all the fees.

Now these locked in phone contracts could really strangle everyone's wallet.   What if one phone company is paired with MasterCard....and another with visa.....and someone wants to buy from you....do you have to carry fees for both?  What if you want them to support your loyalty card....do you pay a fee for that?

The government is way behind on figuring this out..they are ceding the right to sovereign cash over to private companies, so that they get a piece of every bit of business you do.  These are big dollars at play.

If you own a building with a Banking Machine in it.....better start thinking of a new use for that space.   Watch here for more info.

Corporate Espionage

Fake Apple Store being Discovered

In the world of technology products (and many other industries), intellectual property is king, owning patents, trolling on patents, being number one means the majority of all profits for certain sectors are yours.

For technology products like smart phones, the windows from production to launch, to the end of that products life before a new version comes out is frighteningly fast.

RIM could not get its playbook out in time for last Christmas and his been playing catch up ever since.  Samsung and Apple are working hard to stall the success of each other product launches on tablets and phones.

With so much at stake, Apple has gone about advertising for security specialists to protect it's intellectual property all over the world, from cradle to grave, against corporate spies and counterfeiters.

The job has never been tougher and the window never been tighter, the only thing that separates a lot of technology companies today is their swiftness in moving from the idea of a product to execution and delivery of it to the marketplace, before it is copied, cloned, or counterfeited.

News Article on Apples Plans here.

Quick, Easy, Free Screen Sharing Tool - Good for Fast Troubleshooting

One of the simplest things that can "hang" a business is a problem for a customer using their PC to access your services, or to get settings right.

(might even be good to help out friends and relatives who are technically challenged....no way that is yourself of course!)

This neat little java program is free, requires no licenses, very simple to operate. Its a beta program by this screen recording company.

To check it out watch the short video below. It might save you a trip. Link to the site is Here.

Toyota - Learning how to protect its supply chain from earthquakes

Some very key points in this article about Toyota and how they are approaching Business Continuity Planning....they follow the same model as I teach in my book.

The article does not have it totally correct, but paints some key points.

First they set the target and the goal...to be able to return to full production with in two weeks of any major disaster.  The goal is key, it drives the research, and the planning, and the costs.

They are currently about 80% of the way thru identifying what I call "single points of failure".  Once these are identified, you look to discover protections, backups, or workarounds.  Notice from the article many of the failure points are in their vendors not necessarily in their production facilities.

One of the things they discovered was they need to standardize more of their parts, some parts are slightly different than the same parts for other countries, therefore they could not be used to continue production.

The key is to first set the goal.  The article is here.

Is Your Business Near a Nuclear Reactor - There is Insurance for That

What happens if an earthquake or a Tsunami strikes, or some kind of nuclear safety malfunction....governments institute an "Exclusion Zone"....barring people from entering certain areas.

You can now buy insurance if your business is located in one of these areas and it interrupts your revenues or production.

You can read about the company offering this coverage here.

Our First Real Social Media Hurricane

Hurricane Irene is due this weekend, all along the eastern seaboard government agencies are springing into action.

Companies who have Business Continuity Plans will have a real live chance to execute, keep detailed notes, look for areas to improve or correct.  Those who have no plans, can contact us here to find out how to make them.

Now, to social media will it help your company, are you using it?  Will it help communities?  We will likely see thousands of twitters, twit pics, and facebook updates documenting the hurricane.  But will providers be able to keep up?

During the earthquake in DC this past week, cell phones and text messaging would not work at all....now the providers say it was all okay, just some delays....that's not what the people who used the service say.  Are you counting on your cell phone to work?

What happens if during evacuations, looting takes place, will police or military be deployed.....will looters use blackberry and twitter to co-ordinate.....will the government have the service shut down, like happened in San Fransisco with BART protests, like the British Government is considering after their riots?

At last report, Hurricane Irene is weakening to a Cat 2.....maybe it will blow over, or maybe not.

We may get a chance to see the governments response to disasters like this, will it just be to shut down like NY transit is going to do, will it shut down communications?

We will see.

Dis-inter-mediation, Transaction costs at Checkout

One price breakdown that you never see is what it costs you to buy something with a credit card, or with a debit card, but you know the cost is built into the prices in the store.

This new player in the credit card transaction business, is giving a scare at least to the established players.

Using an I phone and their reader, they give a low cost, no fuss, low overhead solution for small, if not soon every business.

This tight little story about a cupcake shop and what they pay tells a great story and lets you in on the secrets of the game.

Read the article here.

World's Largest Pivot - Bold Move, or the Death of HP?

The word "pivot" is huge in the emerging world of technology start-ups.

Twitter was a pivot, gaming companies made the pivot...its what you do when what your business was to become has hit a stall, and you need to go in another different direction and more or less change the core of your business operations or revenue....on the fly.

HP is the biggest play yet at this as they give up hardware and move into the world of software as there full time core.

The move is either brilliant, as the PC device era is dead, without software revenue to boost it, or its a mistake if they cannot dominate in software.

General Electric was and probably is the best at exiting businesses, just before they have peaked (I have seen them do it brilliantly), but they have a stable of businesses, not just one to rely on for revenue.

Is coding the future, other countries are far ahead of North America in software engineers...the other thing that GE famously did is they would not go into a new business unless they could be number one or two in the market....no third place for them.

This is either a brilliant move if they can pull it off....or the death throws of a giant. Read more here.

London Riots Insurance Estimates Losses at $322 Million Dollars

As we reported before Insurers may make claims against the local police authority for damages from riots if the claims are made within 14 days, the government has agreed to extend the time to make claims under the act to 42 days.

More info in this article.

Stage Collapse Kills Four in Sugarland

As we posted earlier about the stage collapse in Ottawa Ontario, then the band Cheap Trick refused to play the PNE in Vancouver where the same make of stage was used in case it collapsed, another stage has collapsed, leaving 4 dead. Dramatic video shows the collapse at about the 20 sec mark. Unknown if this is the same stage manufacturer, no info at this time.

UPDATE - Another person has died bringing the toll to 5 Dead

London Riots and Insurance Claims....

Why you need to be quick to get your claims in.

According to the Chartered Institute for Loss Adjusters....the insurers can take their losses and make claims against the police agencies for losses.

The Claims need to be lodged with the police within 14 days of a riot.

Riot is defined as “when 12 or more people have gathered to use or threaten violence for a common purpose” (full definition within Public Order Act 1986).

This is according to the Riot Damage Act. They include a form for making claims on their site here.

Concrete Failing All Over Montreal - Mob Involvement?

Montreal is seeing its bridges and roads crumbling, big chunks of concrete falling onto roadways....worries about bridges and tunnels.

Lots of reasons are being suggested, but could there be any ties to the mob and inferior concrete?

In Manhattan the District Attorney has laid organized crime charges against the company that graded and approved cement for work on projects....seems it was owned by the mob.

The New York mob has long had associations in Montreal.....wonder if there is any connection?

Story on Montreal here.

Infrastructure Security - Siemens PLC controllers vunerable to hack

One of the devices which helps control everything complicated systems run on is the PLC controller.

(A programmable controller is a digital computer used for automation of electromechanical processes, such as control of machinery on factory assembly lines, amusement rides, in many industries)

A security program exists with the pre 2009 Siemens controller according to this security experts report. He say among other problems is a hard coded back door password in all the controllers that can be used to change their programming.

If you run an industry that may be a target for terrorist hackers, you need to read this story.

...this is the same exposure that has been used to attack nuclear plants and water treatment facilities.


Update - Siemens says it is issuing a fix for some of the security holes identified....read about it here.

Stage Collapse in Ottawa Cancels Cheap Trick Concert at PNE

A collapse of a stage that Cheap Trick was performing on in Ottawa dramatically collapsed when windy stormy weather moved in.

The manufacturer of the mobile stage, is the same manufacturer who supplies the stages to the Pacific National Exhibition in Vancouver.

Cheap Trick was scheduled to play a concert there, but cancelled when they became aware that the same stage was being used, and they want to know why it collapsed, and that it won't do it again.

The cancellation won't result in lost money for tickets being returned, it was a concert paid for by the PNE, but now they will have lost this attraction...which could ultimately hurt attendance.

You have to keep an eye out for risk, what happens somewhere else in the world could affect you and your business.

Read about the story here.

Does your Insurance protect you from this?

Are you in finance, or operations for your company? Have you looked at a comprehensive review of what can interfere with you business operations and cash flow.

One of the areas is government and infrastructure.

Are you prepared if you get a sinkhole in front of your street that prevents access?

One owner in this story says its a triple loss.....he is losing Customers, Income, and inventory from the water damage.

Read more here.

How to Break into Fort Knox?

As someone who used to protect the Canadian version of Fort Knox, I have a few thoughts on this column......but I will keep them to myself.

A short slide show on what protects Fort Knox.

.....although there are a lot of people questioning if the gold is really still in there!

Getting Your Insurance Policies in Shape for Business Continuity

What are some of the simple things you should do now, before you have a business interruption?

1) Call in your insurance agent and find out what your policy currently covers in terms of business interruption and claims.

2) Have your insurance agent point out any gaps or potential gaps in your coverage, so you are at least aware of your options and can weigh the benefits of increasing coverage, or manage the risk yourself.

3)Develop clear guidelines for how to contact and process information in the event of a loss.

4)Decide if you need to create, update, or train your team on emergency responses to business interruption events. (we can help you with that plan)

5)Insure your program protects key documents, invoices and accounting required to make claims.

If you need help putting together a business continuity plan, contact us at rossmcleansecurity.com

Security at a Las Vegas Data Center

One of the purest forms of Business Continuity Planning is at massive data centers.

Downtime at a data center can be tens of millions of lost revenue a minute for its customers.

While physical security measures have always played a key role, energy and cooling for the centers is rapidly rising as key points of failure.

For this data center, even the heat off of each led light is a consideration in their planning.

Read the article here.

Hottest Title on Wall Street - Chief Risk Officer

As we discussed a few years ago....risk and managing it is increasingly an important consideration for businesses.

This article shows the profiles for some of the top Risk Management Officers on Wall Street (they needed them in 2008).

The position now reports to the CFO and pay is thru the roof for top risk managers.

The article is here.

Managing Risk more important now .....

2008 and beyond, we have moved into new territory for managing risk at the macro level.

Companies and individuals are starting to see that risks exist that can wipe them out.....it just could not happen to them.

From the banking sector, mortgages, to even the value of the dollar that everything you own is based on is at risk.

We have extreme concentration of power and money in sectors now, single points of failure that can fail three times or more removed from you, but can bring down your financial position.

Those are just the man made risks.

Japan has suffered from "the lost decade" where they have not recovered from their financial woes...they were the manufacturing jewel of the world but due to competition in India, China, and Korea, were never able to regain top spot and margins on their products. They face increasing competitive nations who can go lower on costs.

Add to that the recent nuclear accident caused by the earthquake and the tsunami. The costs are devastating.

If you think it can't happen to you, think again.....read about how Suzuki Motors is looking to move entire factories out of danger zones, even to move some of them out of country.

Short article here.

Convenience Store Clerk Stops Armed Robber with Samurai Sword

Corner stores are being robbed at an amazing rate in Toronto, almost all of the robberies fly below the radar because the main stream media does not cover them.

In Toronto recently one store owner saw a man who shoplifted from his store previously, he chased and caught the man and held him until police came (which can be quite a wait most times)...the police came and promptly charged the STORE OWNER....for assault and kidnapping.....eventually after much pain and actually going to trial...the charges were dismissed.  Trying to capitalize on this the government is introducing new legislation that will allow broader citizen arrest powers.

I shudder to think what the police would have charged this brave store owner for.

Chip and Pin Debit & Credit Cards Security Broken?

Here is a rather long, yet compelling video by an expert who shows just how the chip and pin cards are broken, and what they describe as the most open vulnerability they have ever seen in banking technologies.

How is the technology defeated.....essentially the pin is actually useless when hacked at the point of purchase, the copied cards trick the purchase device into approving the transaction as the card presented and signed for, which requires no pin.....in the demonstration they used the pin...... 0000  four times and the card was accepted every time.....but most importantly the receipt returned from the cash register shows it being accepted by the chip and pin being correct.

So the audit trail shows on all the banks records that the chip card was present and the correct pin was entered.  Why is this important and why are the banks not rushing to spend the money to fix it?

Because as the expert shows, new terms and conditions on the user contracts state that if the card is present and the correct pin is used, the card owner is solely responsible for any losses, because in the banks opinion their system is uncrackable.  So the only way they claim a purchase can be made is by you or your negligence with the card and your pin.    Not the banks problem they say.

The video shows a chart in the decline of fraud with the new cards, which is really the decline of the bank paying back cardholders their money for their flawed system.  So if you have a loss on your card and the bank won't refund you the money.....send them the link to this video.

Shrinkage are you safe?

How does one steal nearly $1 million worth of electronics and hardware from storage giant EMC? Easy: Just use a small bag and lots of patience. Unfortunately for the thief, not getting caught while doing this proved slightly more difficult.
The engineer in question is Kevin Kelly, who worked at EMC's North Carolina location as a tester. Also, as a catpurse, since he was able to smuggle approximately $930,000 worth of goods out the door in a small bag over the course of an undisclosed amount of time. He then sold those goods under a pseudonym to a company called BL Trading.
Eventually Kelly was arrested for his crimes and today faces up to 32 years in prison, even after pleading guilty. BL Trading is being charged with a host of crimes too, including receipt of stolen property, fraud and transportation of stolen property. [IT News via Slashdot]

Parking Garage Entrances - A Death Trap Liability?

There have been two deaths at parking exits and entrances in the GTA recently.  The most recent one at a hospital in York Region on Christmas day, killing a young mother of 3.

Earlier in the year another man died while trying to enter his apartment's underground parking entrance.

In both instances the drivers could not reach or had trouble getting to the device to open the gate or the garage door, opened their door and leaned out, but the vehicles moved forward and pinned them in their car door pushed up against the protective bollards around the parking equipment.

Likely, they never put their vehicles in park and their foot slipped off the brake.

Almost all parking garage and lot exits or entrances have similar setups.  But with the difference in vehicle sizes from Vans and trucks to Smart Cars.....and the differences in the devices.....push a button, insert a card, or even proximity card devices all may lead to being part of the problem.

No word on any lawsuit or insurance claim for the dead mother yet.

If you have an entrance or exit like this, at minimum consider getting up signage that tells people not to exit their vehicle to access the devices and if they must to ensure the vehicle is placed in park.

These are terrible tragedies .....but also potential liabilities for property owners.