After the earthquake and tsunami in Japan, a key location for Sony Ericsson, the team acted quickly to locate staff and get the business back on track. Jonathan Pearl outlines the issues for a corporate after such a disaster

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At last month's Legal Week Corporate Counsel Forum Europe, held at Luton Hoo and chaired by former Herbert Smith senior partner Lord David Gold, Sony Ericsson vice president and general counsel Jonathan Pearl led a panel alongside former Northgate Information Solutions legal head Jeremy Evans on crisis management. The pair outlined how their companies had dealt with the disasters of the Japan earthquake and tsunami earlier this year, and the enormous fire following the Buncefield oil depot explosion in Hemel Hempstead in 2005. Delegates heard how the crises affected the businesses as well as the legal teams' roles in dealing with the initial disasters and getting the business back on track.

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I've read a few articles on crisis management and I've even been to a course or two on the subject. I was also heavily involved in writing my company's disaster recovery plan. But nothing fully prepares you for the real thing. So – here are my observations and a few tips learned from my recent experiences of the Great Eastern Earthquake and Tsunami.

At 4:46pm Japan Standard Time on Friday, 11 March 2011, a 9.0Mw earthquake occurred 20 miles below the seabed, 43 miles off the east coast of Japan. This was the most powerful known earthquake ever to hit the country, and one of the five most powerful in the world since records began in 1900 – so powerful that the main island of Japan, Honshu, was moved 8ft eastwards and the earth shifted on its axis by 10-25cm. The quake was followed by a tsunami, with waves of up to 133ft – some of which travelled up to 6mi inland.

Like many, I watched the live-feed TV images showing the waves crash through towns – tearing up buildings and bridges like they were made of balsa wood and throwing cars and airplanes around like they were miniature toys.

The earthquake and tsunami caused massive destruction to Japan's infrastructure: roads, railways and power and water supplies were swept away. Around 125,000 buildings had been destroyed. Over 4.4 million households were left without electricity. Around 1.5 million people were left without clean water. There were huge explosions, fires, dams burst. Worse still – over 15,000 people lost their lives and over 6,000 were injured. A similar number were made homeless or displaced.

Within 30 minutes of the quake, my chief executive officer called and asked me to put our prepared disaster recovery plan into action. I quickly assembled a crisis management team (CMT) comprising all the key players, including HR, sourcing, sales, development, IS/IT and corporate communications. Roles and responsibilities were quickly allocated. For the next four weeks the CMT met via teleconference at least once a day. The CMT reviewed all the data that was coming in and made all the major decisions on how the company handled the crisis. After each meeting we circulated minutes documenting open issues and agreed actions.

Sony Ericsson has more than 1,100 employees based in Japan, including many European expatriates. The first task was to locate all our Japan-based employees and the many employees who were on business trips in Tokyo when the quake struck. If, like us, you have a highly mobile and international workforce, just finding out how many people you have in a major city like Tokyo at any given time is not an easy task. Knowing for sure that they are all safe is even harder. Luckily, we subscribe to a service that tracks our staff travel for precisely this reason. We soon knew that, fortunately, none of our staff had been killed or injured, although a large number had family members or friends who were directly affected.

Japan is not only the home of Sony, our 50%-owning parent, but also a major sales region. Further, the factories in the Sendai region, where the tsunami hit hardest, are a major source of vital electronics components. Many electronics components were in short supply even before this disaster, given the strong global consumer interest in smartphones and electronics. In the context of just-in-time manufacturing, one missing key component can quickly bring production to a total standstill.

The earthquake and tsunami compounded an already difficult supply situation with logistical issues and a massive price spike caused by some manufacturers offering suppliers premiums for preferential treatment. All of this, and the possible impact on our quarterly-announced results, had to be carefully managed by the CMT.

Disaster recovery experts tell you: beware the "false dawn of recovery". The earthquake aftershocks continued for many days. The tsunami also caused three level seven meltdowns at the Fukushima Nuclear Power Plant complex, which dominated the crisis for following two weeks. The Japanese Government set up a 10km evacuation zone, affecting hundreds of thousands of residents. For several very tense days the world watched with bated breath as the authorities attempted to gain control of the fire raging at the Fukushima plant. Even when the situation at the nuclear plant was brought under control, there were still major power outages across Japan – a problem which is ongoing.

Clear, transparent and timely communication to stakeholders is a vital key to successfully managing any crisis. But the initial scarcity of data was quickly followed by an avalanche of information from inside and outside the company. Some of this data turned out to be wildly inaccurate: like the spoof-BBC report that circulated in Asia warning people to stay indoors if it rained because of nuclear fallout.

Sony Ericsson has a highly international workforce – a huge advantage in most circumstances. But this threw up some unexpected challenges as we began to recover from the initial effects of the earthquake. In fact, our communications challenge was made more difficult by the varied and sometimes contradictory advice given by the US, Japanese, French, German and Swedish Governments to their own nationals located in Japan.

One person in the corporate communications team did a great job of keeping the CMT informed of news bulletins and press statements from our competitors and household brands in other sectors that were affected. Another part of the corporate communications team took the lead in drafting internal and external communications which were all pored over by the CMT. The distinct management of inbound and outbound communications is a model adopted in many broadcast newsrooms and I can thoroughly recommend it.

Crisis management experts tell you to "think the unthinkable". During the four weeks following the initial quake, the CMT considered a wide range of possible scenarios: should we charter planes to move all our Tokyo-based staff to a "safe" city in Japan, or even further afield? Should we buy supplies of iodine to protect our staff from radiation sickness? If we took any of these drastic measures how would staff, customers and other stakeholders react? What would be the impact on our long-term consultants and our sub-suppliers? Thankfully, many of the measures considered weren't necessary, but the ongoing planning and questioning by the CMT was vital in order to keep on top of the crisis.

Finally, I was amazed by the indomitable spirit of our staff in Japan and the fortitude of the Japanese nation as a whole. Many of our staff slept in their offices rather than abandon their colleagues and customers. Because of the huge disruption to the transportation system, some staff walked up to two hours to and from their homes and the office each day for several weeks. There was no looting and no rioting. People selflessly helped their neighbours and their community.

People wanted to carry on working and took pride in exceeding their customers' expectations in truly adverse conditions. Ironically, Sony Ericsson Japan had one of its best-ever months' sales results in March – truly demonstrating the fortitude and resolve of this inspiring nation.

Jonathan Pearl (pictured) is corporate vice president and general counsel of Sony Ericsson Mobile Communications.

Click here to read a Legal Week interview with Jonathan.

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