Focused on Risk

A neglected process by a number of business owners is implementing a disaster recovery plan.  Statistics show that after experiencing a catastrophic loss, 1 in 4 businesses will close their doors, permanently. One solution could be a formal written disaster recovery plan.  Having a well thought out disaster recovery plan might be the difference in a business staying open or being forced to close after a catastrophic event. 

When a business experiences a catastrophic loss, there are multiple factors that can lead to the operation closing.  For example, how long will it take for the business to re-open?  How do you keep customers from turning to a competitor? How do you prevent your employees from finding employment elsewhere?  These are just a few questions to consider.  Having a written plan in place on how to deal with these, as well as other questions specific to your business, might just ensure you don’t shut down, when you burn down.

Disaster Preparation and Response

• Be sure to discuss terrorism and applicable natural disaster coverage with your Chappell, Smith & Associates, Inc. representative.
• Keep copies of insurance policies and other critical documents in a safe and accessible location (e.g,. a fireproof safe).
• Evaluate which disasters are most likely to occur in your area, remembering to include the possibility for terrorist activity. Be sure you are prepared for all of the risks you identify.
• Develop a Disaster Recovery or Business Continuity Plan. If you already have one make sure that it is current. This entails preparing for anything that disrupts your business operations and planning for a backup option. You may consider identifying backups for essential operations, supply chains, personnel, business functions, data processes and communication channels.
• Review your policy for off-site backup of EDP records. Ideally these records should be backed up and transmitted or sent off-site on a daily basis.
• Have telephone call lists available (include cell phone and pager numbers) for all key personnel so required staff members can be contacted during non-working hours from any location. Review procedures for notifying employees that your facility is closed. Remind employees that they should never attempt to enter areas that are closed by police or other emergency responders.
• Consider establishing an alternate method for your phone service if the switchboard becomes unusable (e.g. forwarding incoming calls to a cell phone or remote number).
• If you are forced to temporarily close, you should have strategies in place for communicating with your customers and clients of the situation and status updates regarding any disruption in services.
• Check available emergency supplies such as flashlights, batteries, emergency generators/fuel, patching materials such as plastic sheeting, wood 2x4s, duct tape, spare fire extinguishers, first aid kits, etc.