In case it slipped your attention, millions of people around the world waited with baited breath for the ‘end of times’ or Rapture that was predicted to occur at 6:00pm on Saturday May 21st 2010. Needless to say the fact that you’re reading this shows that the Rapture didn’t happen, but just like after this years Queensland floods it got me thinking. What would happen if you were to disappear tomorrow, could/would your business go on without you? In short, do you have a disaster recovery plan for your business?
OK, so I appreciate the vast majority of people did not take the predicted Rapture seriously, but I’m sure that I wasn’t alone in spending a little time pondering what would happen if it had. Sadly, many small business owners here in Queensland already know what it’s like to impacted by a disaster. This January’s floods saw hundreds (if not thousands) of businesses devastated by flood waters and many more impacted by their customers, suppliers and staff being flooded. Sadly, too many of these once vibrant and viable businesses will never recover, but with 20/20 hindsight one sees that many of these businesses could have been saved had they had a Disaster Recovery Plan.
Disaster Recovery Planning For Small Businesses
A Disaster Recovery or Business Continuity Plan sets out how a business will recover from a catastrophic event. It provides a step-by-step process for how a business should handle, respond to and rebuild after a disaster. Disaster recovery plans are commonly overlooked by small business owners who believe it’ll never happen to them (or as we say here in Australia, ‘She’ll be right‘) however, as we experience more and more natural disaster around the world, this type of all-encompassing document can make the critical difference to whether a business is destroyed or survives.
A Checklist For Small Businesses
There are many disaster recovery planning resources available on the internet and clearly each business is different and there may be other factors that require consideration depending on the sector they are in. To get you started, we’ve drawn together some of the best of these resources into the following checklist.
1) Develop a Disaster Recovery Plan
- Establish a disaster-recovery team of employees who know your business best, and assign responsibilities for specific tasks.
- Identify the kinds of disasters you’re most likely to experience (natural disasters and others such as technical and resource failures).
- Prioritize critical business functions and how quickly these must be recovered in order to maintain operations.
- Establish a disaster recovery location where employees may work off-site and access critical back-up systems, records and supplies.
- Plan for where key employees, their families and pets will live during the recovery.
- Update and test your plan at least annually.
2) Alternative operational locations
Determine which alternative locations are available. For example:
- A satellite or branch office of your business.
- The office of a business partner or even an employee.
- Home or hotel.
3) Backup site.
How will you equip your backup operations site with critical equipment, data files and supplies such as:
- Power generators.
- Computers and software.
- Critical computer data files (payroll, accounts payable and receivable, customer contact details and orders, inventory,).
- Equipment and spare parts.
- Vehicles, boats and spare parts.
- Digital cameras.
- Common supplies.
- Supplies unique to your business (order forms, contracts, etc.).
- Basic first aid/sanitary supplies, potable water and food.
4) Safeguard your property
Is your property prepared to survive a cyclone, flood, earthquake or other disaster:
- Your building?
- Your equipment?
- Your computer systems?
- Your company vehicles?
- Your company records?
- Other company assets?
5) Contact information
Do you have current and multiple contact information (e.g., home and mobile phone numbers, personal e-mail addresses) for:
- Key customers?
- Important vendors, suppliers, business partners?
- Insurance companies?
- Is contact information accessible electronically for fast access by all employees?
Do you have access to multiple and reliable methods of communicating with your employees:
- Emergency toll-free hotline?
- Mobile phones?
- Satellite phones?
- BlackBerry(TM) / Smart Phones?
- Two-way radios?
7) Employee preparation
Make sure your employees know:
- Your Company emergency plan.
- Where they should relocate to work.
- How to use and have access to reliable methods of communication, such as satellite/mobile phones, e-mail, voice mail, Internet, text messages, BlackBerry(TM) / Smart phones
- How they will be notified to return to work.
- Benefits of direct deposit of payroll and subscribe to direct deposit.
- Emergency company housing options available for them and their family.
8 ) Customer preparation
Make sure your key customers know:
- Your emergency contact information for sales and service support (publish on your website).
- Your backup business or store locations (publish on your website).
- What to expect from your company in the event of a prolonged disaster displacement.
- Alternate methods for placing orders.
- Alternate methods for sending invoice payments in the event of mail disruption.
9) Evacuation order
When an evacuation order is issued to your business, be prepared to collect and leave with critical office records and equipment:
- A copy of your disaster recovery plan and checklist.
- Insurance policies and company contracts.
- Company cheques and a list of all bank accounts, credit cards, ATM cards (etc.).
- Employee payroll and contact information.
- Desktop/laptop computers.
- Customer records, including orders in progress.
- Photographs/digital images of your business property.
- Post disaster contact information inside your business to alert emergency workers how to reach you.
- Secure your building and property.
10) Cash management
Be prepared to meet emergency cash-flow needs:
- Take your cheque book and credit cards in the event of an evacuation.
- Keep enough cash on hand to handle immediate needs.
- Use Internet banking services to monitor account activity, manage cash flow, make payments via EFT.
- Issue corporate credit cards to essential personnel to cover emergency business expenses.
- Reduce dependency on paper cheques and postal service to send and receive payments (consider using electronic payment and EFT banking services).
11) Post-disaster recovery procedures
- Consider how your post-disaster business may differ from today.
- Plan whom you will want to contact and when.
- Assign specific tasks to responsible employees.
- Track progress and effectiveness.
- Document lessons learned and best practices.
Failure To Plan Is Planning To Fail
If you have any doubts about whether disaster planning is a worthwhile exercise for small businesses, please contact Queensland Chamber of Commerce and ask them how many of their members businesses have closed since the January 2011 floods. Spending a few hours thinking about the above questions and having them documented and communicated to the key stakeholders in your business can mean the difference between your business recovering from major incidents or collapsing. It’s a well worn adage, but quite simply ‘failing to plan is planning to fail.’