3. What resilience strategies did Nissan use? List and evaluate each?

Nissan's resilience strategy was regarded as an exceptional reaction to Japan's triple disaster in
March 2011. After being damaged by an earthquake, tsunami, and nuclear crisis, the Japanese
automobile industry began recovery efforts to resume production and delivery of vehicles, but it
took months before they could return to pre-disaster levels of operations (Please refer to the charts
in the appendix). Experts and analysts rated Nissan's resilience measures and supply chain disruption
management much superior to those of its competitors. Nonetheless, Nissan took more than a
month to resume production and more than 3 months to get back to pre-disaster production levels.
Each day of downtime costed the company $25 million.  
Nissan’s operational resilience identified potential problems before they could actually happen and
came up with a plan to minimize the effects and allow the company to quickly recover. This disaster
recovery approach was comprised of a number of elements, including but not limited to the
company's earlier developed capabilities for swift recoveries and the ability to make quick decisions. 

Anticipation of problems and develop strategies accordingly: The organization created a culture in

which preparation for major disasters was the norm rather than the exception. Everyone knew what
to do when it inevitably happened. The company was able to undertake recovery operations in a
timely and focused manner due to its annual execution of drills and simulations.

Respond fast and Recover: To begin with, Nissan set up its global disaster control headquarters in
Yokohama in less than 15 minutes. The committee supervised all recovery efforts and kept an eye on
both domestic and international operations. The company also had a unique post and deployed a
senior person as Nissan's chief recovery officer, giving them an advantage over other automakers
because this person was only concerned with restoring the company's supply chain to normal.

Internal and external communication: Operational resilience relies on communication. The disaster

recovery strategy must first be explained and understood at all organizational levels. Second, to
maintain operations in the event of any disruptive occurrence, communication must be upheld.
Nissan’s communications were transparent, and the management also spoke about areas of
improvement. Nissan's chief operating officer Shiga stated that the company's manufacturing
strength—process engineering activities and manufacturing craftsmanship—would be improved if
Nissan implemented what he termed a "supply risk management chain" that included risk
management concepts. Nissan's chief recovery officer Ghosn mentioned that “You need to establish
a clear order of importance and a diagnosis of the company, or the country. This is absolutely
essential, because after this you are going to act and when you act you need to do it fast. People
need to be aligned and share your vision so you can move in the same direction”.

A people focussed recovery: In an attempt to lessen the impact of a business continuity incident,
companies may ask employees to perform tasks that conflict with their usual work schedules. Basic
health and safety precautions might be overlooked during this uncertain time to avoid a financial
loss to the company. Nissan’s approach was to prioritize the safety of its employees along with the
safety of its suppliers, dealers, and linked companies before engaging in the best ways to restore
operations.

Relationship Management: Nissan supported its suppliers and affiliated companies to restore

quickly. The majority of Nissan's plants resumed operations within a week, and all plants resumed
operations within a month; however, Nissan experienced difficulties obtaining supplies, so it assisted
its suppliers based on the requests received to restore operations as soon as possible. Nissan did not
have any backup sources to aid in the timely supply of delayed parts. Nissan took more than three
months to return to production levels/exports/sales somewhat comparable to the previous year's
data (Please refer to the charts in the appendix).

Long-term tracking & optimization: The crisis management group continued to address production
recovery problems as they emerged during the following months and optimized their disaster
recovery strategies. Nissan later found out that they had underestimated the potential damage that
a calamity may do.
Nissan used agility, flexibility, and exceptional corporate culture to build resilience during the crisis.
When faced with adversity, Nissan also relied on efficient processes to overcome problems. Only one
month after the earthquake, vehicle production resumed. Nissan transferred hundreds of workers
from other locations to aid in the restoration efforts at damaged facilities.