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Case Study: Dealing with Disasters

Levi Strauss & Co. was directly affected by Hurricane Katrina, the most destructive storm to strike the United States and the costliest storm in U.S. history, causing $108 billion in damage [unadjusted 2005 dollars] and 1,833 fatalities, according to the National Oceanic and Atmospheric Administration (NOAA).

The company took full advantage of the plan and tools it had in place to mitigate its disasters.

Levi Strauss & Co. had a three-day advance warning of the storm, and immediately began implementing its disaster management plan, said Moss. Levi’s looked at the potential impact and saw that it had at least one distribution center in the eye of the storm, in Canton, Miss., as well as a facility in Little Rock, Ark., that could be impacted.

The first piece: avoiding problems. Levi’s either rerouted or held departing shipments due to arrive in Canton from its Latin American supplier bases.

The second piece: managing potential issues. Levi’s worked with its ocean carriers to figure out what to do with shipments already en route. Several shipments were diverted to Norfolk.

The third piece: communication and visibility tools. Levi’s used its visibility software to track information, monitor what was happening, and manage the process from its distribution centers at the purchase, SKU and brand level. The logistics and transportation teams, along with its partners, also analyzed what its customers would need after the storm and notified partners of delayed shipments.

“What we found was that we could bring a lot of use to partners by telling them where their goods are and how long it will take to get to a location, unload and deliver,” said Moss. “It turned out that Canton [the primary DC serviced by the Port of New Orleans] was highly impacted.”

The distribution center was without power for three days and shut down for weeks. A second location was underwater, she said.

But goods were not all that Levi’s needed to manage; its people and the community needed assistance too. Again, communication and information were key to handling the human side of the equation both before and after the storm.

“We had to deal with commercial needs but also consider the needs of fellow employees, especially in the Canton area. Their homes were under water,” she said.

All in all, dealing with Hurricane Katrina was “quite a big process.”

Source: Gary Barraco,


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