FEMA assesses the impact of natural disasters by measuring their interruption of multiple large national chains and informally references a "Waffle House Index."
Waffle House is not the only business whose operations are measured to determine natural disaster impact, and FEMA does not formally use Waffle House closures to assess the scope of disasters.
The Federal Emergency Management Agency (FEMA) has inspired a number of rumors, myths, and urban legends. While the majority of these rumors are conspiracy-based ones involving FEMA camps, FEMA coffins, or general martial law conspiracies, another oft-referenced claim holds that FEMA uses something called the "Waffle House index" to assess the scope, scale, and impact of regional national disasters. See this email we received in 2015:
In this article ... They claim FEMA judges disasters based on Waffle House: "Waffle House because Waffle Houses stay open 24 hours, 365 days a year, they've become one of the key ways the U.S. Federal Emergency Management Agency gauges the severity of natural disasters. So, these days, instead of poring over aerial photos or sending out inspectors, administrators can simply check the "Waffle House index" to determine how badly an area has been affected by a storm.
The index is green when the local Waffle House is open and serving its full menu; yellow when it's open, but serving a limited menu; and red when it's closed. Those levels then indicate the extent to which a community has power and water.
Somehow, it ALMOST seems plausible.
Given its large presence in modern-day tinfoil hat lore, it's sometimes hard to remember that FEMA's primary purpose isn't enforcing the new world order upon us any day now. Wikipedia concisely summarizes FEMA's primary purpose as being "to coordinate the response to a disaster that has occurred in the United States and that overwhelms the resources of local and state authorities." FEMA operated as an independent agency from its effective creation in 1979 until 2003, when the Homeland Security Act of 2002 brought it into the Department of Homeland Security (DHS). (It's possible that FEMA's 2003 move from its originally independent status to being part of a law enforcement agency partly inspired fears that FEMA was sinister or authoritarian in nature.)
Compounding FEMA's public relations challenge is the fact that FEMA only tends to be involved in times of great distress. For Americans to require FEMA's help, whatever happened on the ground must have been quite severe. On top of that, the then newly-reorganized agency's widely-criticized, delayed response to Hurricane Katrina in 2005 left many with the impression FEMA was a bumbling (and at worst, carelessly lethal) example of federal inefficiency.
As the specter of Katrina faded, an interesting claim about FEMA began circulating around 2011. It held that one of FEMA's core disaster assessment metrics involved the Waffle House chain, and the level of impact on the operations of Waffle Houses near any given disaster factored into the agency's classification of the severity of such events. On 7 July 2011 an article titled "News of the Day — What Do Waffle Houses Have to Do with Risk Management?" was published to FEMA's blog and explained that:
Yesterday, EHS Today, a magazine for environment, health and safety leaders, explained that major companies such as The Home Depot, Walmart, and Waffle House serve as role models in disaster preparedness. They’ve taken necessary steps to prepare. These companies have good risk management plans to ensure that their stores continue to operate when a disaster strikes, and also provide basic supplies to people in their community.
As [FEMA Director W. Craig Fugate] often says, the Waffle House test doesn’t just tell us how quickly a business might rebound – it also tells us how the larger community is faring. The sooner restaurants, grocery and corner stores, or banks can re-open, the sooner local economies will start generating revenue again – signaling a stronger recovery for that community. The success of the private sector in preparing for and weathering disasters is essential to a community’s ability to recover in the long run.
FEMA's blog in turn referenced a 6 July 2011 article in occupational safety publication EHS Today:
Panos Kouvelis, Ph.D., the Emerson Distinguished Professor of Operations and Manufacturing Management and director of the Olin's Boeing Center for Technology, Information and Manufacturing, says that companies like Lowe’s Companies Inc., The Home Depot Inc., Walmart Stores Inc., and Waffle House Inc. are role models when it comes to disaster preparedness.
That article went on to explain specifically how Waffle House factored into FEMA's disaster assessment practices:
The "Waffle House Index," first coined by Federal Emergency Management Agency Director W. Craig Fugate, is based on the extent of operations and service at the restaurant following a storm and indicates how prepared a business is in case of a natural disaster.
For example, if a Waffle House store is open and offering a full menu, the index is green. If it is open but serving from a limited menu, it’s yellow. When the location has been forced to close, the index is red. Because Waffle House is well prepared for disasters, Kouvelis said, it’s rare for the index to hit red. For example, the Joplin, Mo., Waffle House survived the tornado and remained open.
The notion that FEMA bases its disaster assessments entirely on the impact on Waffle House locations appeared to originate with that article. However, the context indicated that Waffle House was one of several large chains observed by FEMA to assess how badly affected an area's operations might be after a national disaster.
A 19 July 2011 Insurance Journal article credited Kouvelis with the insight about large chains in general, quoting him as indicating that "companies that are most frequently exposed to supply-chain disruption are the ones that have the best risk management plans." That article focused on the general concept of looking to the biggest business entities to determine impact on operations, not necessarily just Waffle House:
Kouvelis teaches his students about the "Top Four" companies — Lowe's Companies Inc., The Home Depot Inc., Walmart Stores Inc., and Waffle House Inc. — that are role models when it comes to disaster preparedness.
"These companies have many stores in the southern part of the United States that are frequently exposed to hurricanes," Kouvelis says. "They have good risk management plans in place and are great examples of how their supply chains get affected in two different ways. On the one hand, your own supply chain is exposed. At the same time, your stores are supposed to be the first to react and provide the basic supplies. Your supply goes down, while your demand goes up."
On 1 September 2011, Fugate was quoted in a Wall Street Journal (in an article on the clues yielded by the chain alongside more formal metrics such as the Saffir-Simpson Wind Scale:
If you get there and the Waffle House is closed? That's really bad. That's where you go to work.
Perhaps more interesting than FEMA's reliance on Waffle House was the chain's own disclosures about disaster management that were related in the WSJ article. While the company admitted "sales volume can double or triple in the aftermath" of a disaster, Waffle House maintained their "strategy is more about marketing and building goodwill than profits":
"If you factor in all the resources we deploy, the equipment we lease, the extra supplies trucked in, the extra manpower we bring in, a place for them to stay, you can see we aren't doing it for the sales those restaurants generate," said Pat Warner, a member of the company's crisis-management team.
Its hurricane playbook explains how to reopen a restaurant and what to serve if there is gas but no electricity, or a generator but no ice. An important element is limiting the menu so the company's supply chain can focus on keeping certain items stocked and chilled or frozen. In May, the two Waffle Houses in Joplin, Mo., were among the few places to stay open after the deadliest tornado in six decades tore through the area.
Since FEMA, Fugate, and Kouvelis' mention of FEMA's "Waffle House Index" in 2011, the "fun fact" has slowly become a staple of listicles and other "strange but true" articles. However, the applicable metric is neither formal nor universal: Hurricane Sandy (for instance) primarily affected New York and New Jersey, where Waffle House isn't an omnipresent brand. The professor who popularized the idea named Waffle House among four large chains in total known for disaster preparedness, perhaps none as catchy as Waffle House. It's true that FEMA factors the impact on large businesses into its assessment of natural disasters, but it's similarly accurate to note Waffle House itself holds no particular magical ability to divine the scope of a hurricane, earthquake, or flash flood.