New Orleans Company Applies Katrina’s Lessons to New DR Strategy
July 10, 2012 Alex Woodie
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Businesses and residents of New Orleans learned lessons about disaster preparedness and recovery the hard way from Hurricane Katrina in 2005. One of the companies impacted by the storm was Stewart Enterprises, one of the country’s largest operators of funeral homes and private cemeteries, which had several properties submerged by flood waters. After the company recovered, it took steps to overhaul how it prepares for future disasters. Stewart Enterprises owns and operates 219 funeral homes and 140 cemeteries in 24 states. The 102-year-old company, which is headquartered near New Orleans and publicly traded on Nasdaq, has about 5,000 employees and revenues of about $512 million last year. Prior to Katrina’s landfall in August 2005, the company had a disaster recovery (DR) plan that had already proved itself with “normal” disasters. With operations extending along the Gulf Coast, up the Eastern Seaboard, and into the Midwest, the company had survived many hurricanes, ice storms, tornados, and other natural disasters common to this part of North America. But of course, as a category 5 hurricane barreling up the Mississippi River from the 90 degree waters of the Gulf of Mexico, Katrina was no “normal” storm. After the levees failed due to Katrina’s storm surge, parts of New Orleans were submerged in up to 15 feet of water. The devastation that New Orleans suffered as a result of Katrina has been well documented. Almost 2,000 people lost their lives, and many more are still recovering from their losses. Total damage is estimated at $81 billion, the most for any natural disaster in this country. Stewart also suffered damages when three funeral homes and five of its cemeteries were submerged in Katrina’s floodwaters. Inside these facilities were hundreds of thousands of business documents, including burial contracts and correspondence with family members. These were the only copies of the documents, due to the impracticalities of keeping a second, separate set of paper-based documents synchronized with the master set, says Brian Pellegrin, a director of IS business support at Stewart. The nature of the cemetery business prevented the company from making backup copies of its documents. “It’s not one week’s worth of paperwork or one contract and we’re done,” Pellegrin said. “That’s an open file that’s continually updated literally over decades. It is an open and ongoing relationship that we have with that family, so it’s really impractical to have complete duplicates offsite at another location.” The documents were critical to Stewart’s business in New Orleans, not to mention the relationships that Stewart had with families of the deceased in its care. But restoring them would be difficult. “They were submerged under mud and sludge and oil and whatever else was in that muck,” Pellegrin says. After the floodwaters receded, Stewart paid a firm that specializes in paper restoration $1.5 million to restore what was left of the documents. They cleaned the pages one by one, and successfully recovered more than 90 percent of the documents. For Stewart, it was an expensive lesson in disaster preparedness. Going Paperless As luck would have it, just prior to Hurricane Katrina, Stewart had turned down a proposal from digital records vendor Laserfiche that would have converted the paper documents into digital documents, and thereby protected them from the storm. Stewart moved quickly to put the proposal into production. “To be honest, at that time, we were in DR mode. We didn’t send out RFPs and do a 90-day search. We had just had the proposal from Laserfiche. We were a little concerned about the price tag and transition to digital,” Pellegrin says. “But after the disaster, the price tag was nothing compared to our frustration and the need for business continuity. We looked at that with a different set of eyes, that we wanted it to be digital. That way, those records would not be put in harm’s way again.” Stewart decided to implement Laserfiche first in its hometown market around New Orleans. The hundreds of thousands of documents that were recovered from the floodwaters would be converted into digital records and stored in Laserfiche’s SQL Server-based database. Stewart employees who had lost their homes to Katrina worked in the office of a Laserfiche business in nearby Baton Rouge to input the documents and apply the correct indexing and metadata. There initial effort to input documents into Laserfiche lasted several months in the beginning of 2006. At the end the project, Stewart’s funeral homes and cemeteries around New Orleans were completely digital. Today, as soon as a new Stewart customer signs a contract, the paper document is scanned into the Laserfiche system. Any updates to the contracts, such as “pre-need” changes to the contract or gravestone markings requested by the surviving family, are immediately input into Laserfiche, which now serves as the master repository for documents. Stewart also makes extensive use of the workflow capabilities in Laserfiche. As soon as a new document is introduced, or an existing document is changed, it’s immediately routed to the appropriate person for approval. Having the documents exist electronically also gives Stewart much greater visibility into the state of its business. In fact, the company has hooked Laserfiche into its business intelligence application, which enables managers to track business operations on a real-time basis. Stewart has widened its Laserfiche investment since 2006, and today all of its facilities use Laserfiche. About six Laserfiche file and database servers control about 4 TB-worth of TIFF documents, which are accessed from about 500 full-access clients, and 1,000 read-only clients at the company’s facilities around the country. Not all of the facilities are 100 percent digital at this time. After all, some of Stewart’s cemeteries are 100 years old, and have documents extending back that far, so the massive scanning effort continues. But the company is well on its way to becoming completely paperless. Preparing for the Next Disaster With many of its critical documents stored digitally in Laserfiche, Stewart has successfully eliminated a major weakness from its disaster preparedness and recovery plans. At the same time, it has gained operational efficiencies through streamlined workflow. The company is able to convert the data in the documents into actionable information, thereby enabling the company to make better business decisions. But the operational efficiencies are just a side benefit of the Laserfiche implementation at Stewart. “Our number one goal is disaster preparedness,” Pellegrin says. “Our goal was not to reduce headcount or get any kind of efficiency gain or ROI. Our number one goal is to preserve these documents so that we can serve our families.” Document preservation is a critical thing for a company in the funeral and cemetery business. “In our business, customer service has to be 100 percent. You don’t get a chance to go redo the muffler. We have to have it right, and we have to have it right every time,” Pellegrin says. “Our top priority is serving families at the worst time in their life, so if we can do something in terms of technology to make it easier for us to provide customer service and take care of the families, then that’s what we’ll do. We just cannot risk we’ll have a fire in Wisconsin or in Maryland or in Seattle and then these customer records, which we’ll need for decades, will be lost. We just can’t risk that.” The company has bolstered the disaster preparedness of its IT system in other ways, too. According to a September 2010 case study by IBM, the company acquired two Power Systems 550 Express servers as part of a server consolidation and DR project. The Power Systems boxes run its Unix-based Oracle human resources and payroll applications (the company has largely replaced its IBM iSeries environment with AIX and Windows-based applications over the years). It also signed a co-location contract that gives it space in an AT&T data center near Dallas, Texas, which serves as a backup to its primary data center at its headquarters in Jefferson. Data is replicated between the two sites, and Tivoli Storage Manager backs up the Power Systems environment, while an IBM TS3310 LTO tape library stores data from all of Stewart’s most critical systems, including Laserfiche. For those who survived Katrina, the hurricane served as a wake up call to get DR plans in place. Stewart very nearly lost hundreds of thousands of pages of critical documents to the floodwaters. But with additional layers of protection now in place, the chances are slim that it will ever have the difficult task of facing its families empty handed.
This article was corrected. Stewart Enterprises is 102 years old, not 112. IT Jungle regrets the error.
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