Lehman also is developing business continuity plans tied to the color-coded Homeland Security Advisory System devised by the Office of Homeland Defense. If the country moves from yellow (elevated) to orange (high) warning level, for instance, certain executives might be instructed to work across the river in Jersey City, and nonessential employees might be told to work at home. In fact, home offices were so crucial in the recovery that Bridget O’Connor, Lehman’s head of business continuity, is trying to get employees to work from home one day a month to make sure they have the know-how to keep working if headquarters is closed.

But decentralizing operations can be more complicated than it sounds. "The way Wall Street operates, it’s still very face-to-face relationship driven," says Sarah Diamond, managing director for KPMG Consulting in Boston, who has seen a lot of financial services companies begin to rely on IT?not geography?to stay together. "They’re looking now at less concentration of people within one real estate location, as well as taking advantage of technology and doing more telecommuting. It changes the style of the way they do business."

Before, Lehman had been so focused on personal interactions that it had considered ditching its Jersey City building and concentrating all its operations in Lower Manhattan. "If we’d gone down that path, we’d probably be out of business," Beyman says. Now, Lehman will keep not only the property but also the backup trading floor there.

"Who knows what we’ll do three years from now, but for right now we have hot standby for our traders. I don’t know if that prepares us for World War III and the devastation of New York City, but it certainly prepares us for any kind of the really foreseeable future-type of events, like the evacuation of Manhattan, as horrible as it may be. We never would have gone down that path before, but now we go down that path."

The Savvy Networker

"You can never be too rich, too thin or have too much telecom recovery."
-John McKinley, head of global techno-logies and services, Merrill Lynch

Sage words, because even companies whose headquarters weren’t damaged on 9/11 had significant problems with telecommunications. A Verizon hub at 140 West St. was severely damaged, which affected phone service throughout the region. Thomas Moogan, managing director of the general services division of Citigroup Corporate and Investment Bank, says he lear