Medtronic Puts Communities First in Wake of Hurricane Maria
On September 20, 2017, the fifth-strongest storm to ever hit the United States struck Puerto Rico. Hurricane Maria left 100 percent of the island without power, damaged or destroyed 80 percent of homes, and knocked out 85 percent of the cell towers on the island. Medtronic, a global leader in medical technology, services and solutions, would be facing not just an operational crisis as the 2nd largest private employer on the island with multiple facilities, but a humanitarian response to care for the thousands of impacted employees, their families and communities.
As the storm approached, Medtronic developed a dedicated response effort to account for the wellbeing of all employees, mitigate business impact, partner with the community to provide short-term and long-term support, and keep our many interested stakeholder groups informed with the latest humanitarian and operational information.
Part of the Medtronic Mission—written in 1960—is to recognize the personal worth of employees and to maintain good citizenship as a company. When disasters occur around the world, Medtronic supports relief efforts through business and philanthropic response. The imminent threat Hurricane Maria posed prompted development of an immediate disaster response program to minimize employee and facility impact.
It was clear that humanitarian aid would be needed, and rapid response would be critical. Medtronic launched business continuity plans which included the following steps:
- Business teams partnered with Medtronic Global Command Center, their dedicated emergency response hub for tracking global events, security and employee whereabouts.
- Identified list of key internal and external stakeholders that would require activation, communication and outreach (global employees, customers, regulatory bodies, suppliers, investors, media).
- Business assets—such as satellite phones and generators—were procured and distributed in the event of power outage.
With a presence in Puerto Rico since 1974, Medtronic has 5,000 employees in five locations in Ponce, Villalba, Catano, Juncos, and Humacao. All four Medtronic business groups have some degree of manufacturing on the island. For this response effort, the safety and well-being of our employees on the island was the top priority, and colleagues around the world were ready to help.
A cross-functional team—led by two Medtronic executives and comprised of business leadership, communications, government affairs, facilities, HR, supply chain, manufacturing operations, and philanthropy—was quickly appointed and temporarily reassigned at operational headquarters to provide full-time support. A dedicated “war room” was reserved and all communications were routed through the group to ensure accurate and consistent sharing across various stakeholder groups.
In Puerto Rico, island and site leaders were in regular contact with the Medtronic Global Command Center. Medtronic leaders worked with government officials, including the Department of Homeland Security and the Puerto Rico Governor, to streamline humanitarian and operational recovery. Staff traveled to the island to support colleagues based there, providing immediate and long-term rebuilding efforts and capturing stories to share progress. Medtronic elevated its partnership with disaster relief NGOs through the Medtronic Foundation to coordinate onsite response. All island employees were frequently updated and engaged.
Medtronic established a four-pillar response framework: People First (humanitarian); Prioritize Recovery Efforts (manage operations to meet commitments); Streamline Communications (drive informed decisions and minimize confusion); Resume Operations (restore full production, shipping).
Examples of activation included:
Provided Humanitarian Aid:
- Daily/weekly delivery of critical aid supplies and 125+ personnel via 70 flights and 40 ocean containers
- Created an “oasis” at each of our sites with on-site showers, laundry, childcare, hot meals, dry goods, drinking water (2 million bottles), 1,290 generators and 40,000 gallons of gas, on-site medical services, and cash advances.
- Prepared and delivered 10,000 care packages containing insect repellent (mosquito Bourne-disease control) and nebulizers to six hard -hit communities.
- Supported broader community via transportation of a 500-lb. water pipe from the U.S. mainland to Villalba, enabling power generation for the entire city (full story in impact section).
- Increased financial donations to disaster relief NGOs
- Promoted employee volunteering
Ensured Employee Well-Being:
- CEO, Omar Ishrak, and business leaders conducted personal onsite visits to employees at multiple locations.
- Sent daily Emergency Notification System push messages to employee cell phones.
- Hand-delivered announcements to local radio stations to be read on-air for employees.
- Launched internal effort to raise funds for employee assistance.
- Hired 40 drivers to go door-to-door, seeking employees who had not responded.
Provided Frequent Business Updates (Internal/External):
- Created internal global website and sent regular all-staff emails from executives to inform global employees.
- Created weekly Puerto Rico Update newsletter with twenty stories produced, many with video.
- Produced daily operations status report on all aspects of recovery for global leadership, detailing employee status, operations recovery, community support, and government relations.
- Provided media and investor updates on employee and operations recovery; kept commercial teams, customers informed, suppliers and regulatory bodies informed.
The ultimate success factor was that all 5,000 Medtronic employees in Puerto Rico were accounted for, received humanitarian aid, and returned to work. In the immediate aftermath of Hurricane Maria, Medtronic provided free meals to its employees and paid their wages even while production was offline. The company set up “oasis” sites for employees and their families at each facility, bringing in more than two million bottles of water, as well as thousands of boxes of food. The sites provided free gasoline, generators, on-site showers, laundromats and child care, along with a variety of other services such as medical care, ability to withdraw $500 dollars per day from pop-up Credit Unions, and assistance with FEMA applications.
"When we need food, they provide food," said Juncos, Puerto Rico mayor Alfredo Alejandro Carrion. "When we need water, they provide water. They are giving so much. We have been working hand-in-hand with Medtronic and the company has been such a good citizen for this town."
On November 11, 2017 Medtronic announced that non-GAAP revenue impact from the storm was $55-65M, far less than the $250M estimated on Oct. 6 and largely driven by the resilience of employees and strength of our recovery efforts. Our employees in Puerto Rico made countless selfless contributions, despite extensive impact to their personal lives, coming to work every day to ensure customers and patients worldwide received our products. We were fully operational within approximately 6 weeks, compared to other healthcare companies that continue to face production challenges. To date, Medtronic has donated $12M toward Puerto Rico disaster relief, including company giving, employee donations, and Medtronic Foundation contributions.
Company co-founder Earl Bakken established Medtronic’s first Puerto Rican plant in Villalba in the mid-1970’s. Today, Medtronic is Villalba’s largest employer. After the hurricane, government leaders had planned to use the nearby Toro Negro hydroelectric plant for power but the plant did not work due to a pipeline problem. Medtronic was already providing relief on the ground when Mayor Hernandez-Ortiz called on the company to help restore power to the city. Medtronic arranged a charter to fly a section of the broken pipeline to Puerto Rico, then arranged ground transportation to Villalba. Medtronic’s intervention cut the delivery time from 3 weeks, to 2 days. The 92-year-old plant now provides water to half of Villalba’s 25,000 citizens and electricity to a third, including a local hospital, schools and the police station.
“I personally refer to Medtronic as Villalba’s heart,” said Mayor Hernandez-Ortiz. "Medtronic is a great neighbor. An important neighbor. It has been for a long time and I want, I hope that Medtronic stays in Villalba for a long time.”