After the Jan. 1 earthquake on the Noto Peninsula, some factories were forced to halt operations for an extended period due to extensive damage.

Others, however, managed a quick recovery thanks to prepared business continuity plans (BCP), which aim to minimize damage while maintaining essential operations and expediting recovery as much as possible in the event of emergencies, which include disasters.

A factory of Murata Manufacturing Co.’s subsidiary in Anamizu, Ishikawa Prefecture, where a tremor registered an upper 6 on the Japanese seismic intensity scale of 7, must suspend operations until May for repairs to buildings and equipment.

Murata Manufacturing had formulated BCPs at every domestic plant under the leadership of its top management.

In fiscal 2022, the company strengthened the review of its action plans and damage assumptions.

Following the earthquake, 10 of its 13 factories in three prefectures in the Hokuriku region have resumed operations, with one more expected to follow suit this month.

But some factories faced delays in resuming operations, such as one in Nanao, Ishikawa Prefecture, set to restart in March and the other in Anamizu in May.

Among large companies, NTN Corp., a major bearing manufacturer in Shika in the same prefecture where the seismic intensity reached 7, plans to partially resume operations in April.

NGK Insulators Ltd. has yet to announce when full restoration of its group company’s factory in the same town might be possible.

PLANNING FOR THE WORST

The Kanazawa-based Takayama Reed Co., the largest domestic manufacturer of reeds--essential components for weaving looms--managed to restart production about a week after the earthquake, thanks to a BCP developed in 2018.

The company’s Yoshikawa factory in Nakanoto, Ishikawa Prefecture, which exports 70 percent of its production overseas, was hit by a tremor measuring a lower 6 in seismic intensity.

Production equipment in the factory collapsed, but most of the hundreds of reeds in production remained intact due to routinely securing objects with belts in preparation for earthquakes. Only three suffered damage.

Having a BCP in place also enabled a swift initial response.

The day after the earthquake, the company confirmed the safety of all 85 employees and set up a recovery task force in accordance with the BCP.

“Looms cannot operate without reeds,” said Toru Takayama, the president of Takayama Reed. “Even in a crisis, we have a duty to continue our business.”

The government introduced the approval system of the Business Continuity Enhancement Plan, which is a simple version of the BCP, in fiscal 2019 to encourage small and midsize companies to prepare for disasters in advance.

Certified companies are eligible for support such as preferential tax treatment and priority access to subsidies.

BUS SERVICE RESUMED 2 DAYS LATER

Medaka Kotsu, a transportation company based in Noto Peninsula that operates charter and school buses, received certification in March last year.

The company developed its BCP after discussions with an instructor dispatched through the local chamber of commerce.

The plan covers not only employees’ safety checks and seismic reinforcement, but also overall business management, such as securing alternative production sites and a cash flow.

By creating a BCP with the instructor, “I envisioned all the first actions I should take clearly in my mind,” said Ryuichi Hoshiba, the president of Medaka Kotsu.

First, he confirmed the safety of the 10 employees, along with the condition of the office and the five buses.

As the office was equipped with a portable power generator, Hoshiba could quickly boot up the computers, then created operation plans.

Some of the employees had their homes completely destroyed or lost family members, but the company resumed operations on Jan. 3.

The bus transported people stranded at Noto Airport to Kanazawa, taking 10 hours for the one-way trip.

The shuttle service for Chiba city officials, who are assisting in the disaster-affected area, is continuing.

In drafting the BCP, the company also considered financial management in the event of a business interruption--how much of their own funds would be needed and how to obtain a loan.

The company said it was able to simulate this disruption before the earthquake.

“If we had not developed the BCP, we would have focused only on operating buses and might have run out of funds in two months,” Hoshiba said. “Small and midsize companies, in particular, should have a BCP.”

(This article was written by Kenta Nakamura, Takashi Funakoshi and Tomohiko Kaneko.)