A disaster striking your small business and the community in which it operates is a scenario no one wants to think about. Yet not thinking about what you will do in the event of a hurricane or flood can end up costing you much more than just rebuilding costs. Michael Bremmer, CEO of TelecomQuotes.com, likens disaster preparedness to planning for a funeral: “You know it's going to happen, you just don't know when, but you're much better off if you've taken the time to have a plan.” In fact, as the recent devastation caused by Hurricane Sandy on the east coast so clearly demonstrated, preparing your company for a disaster, natural or otherwise, needs to be an integral part of your ongoing business planning. Beyond buying insurance, having safeguards and continuity procedures in place are among the most important actions you can make for the health of your company.
Get set up virtually and remotely
Virtual storage and remote desktop systems have transformed the ability of businesses to continue to work even if their physical location is unavailable. It is essential to develop daily and weekly procedures for all of your employees utilizing these capabilities. Having data backed up via off-site servers (preferably in a location far from where your company is), as well as on a cloud storage system that can be accessed remotely allows your employees to work from home or a temporary location should the situation arise. Though you may have minor delays and slower output, you can still meet the needs of your customers if you invest in the technology.
During and after a disaster, your company will not only need access to data, but also to assets. Richelle Shaw, entrepreneur, author, and president of the National Association for Moms In Business, says one of the ways she prepared for a disaster was to have a relationship with two banks—one local and one national. “My cousin was located in Louisiana during Hurricane Katrina,” she recalls. “Her local bank was flooded out, and she did not have access to money. When I heard her story, I immediately opened an account at a national bank.”
Though you have copies of your important documents protected off-site, other elements of your business should also be duplicated. Jan Decker of Crisis Management Consulting suggests having alternate suppliers and ways to deliver your products. “If shipping is interrupted or specific products are not available, strategize alternatives and keep in contact with [your] customers,” Decker says, “Small business owners that depend on a single source [of] suppliers should have replacement or contingency providers.”
Justin A. Meyer, an attorney with Meyer and Associates who works with small businesses on Long Island, New York, takes the idea of doubling up one step further. “There should be at least two people with keys to the front door and at least two people who know the passwords to the computer systems,” Meyer notes, “Small business owners, because they may only have a few employees, are in a more precarious position. The most important thing they can do is to have some redundancy.”
Know who to call and who’s in charge
Whether your company has three employees or 300, the same priority holds true during a disaster: communicate with employees. “Have a current, updated list with contact information for each employee,” says Jeff Garr, founder and CEO of HR Knowledge. “It could be a chain of phone calls where the supervisor alerts his team, or it could be a website with centralized information. Whatever the plan is, be sure to communicate where the information can be found and how it will be communicated.”
If the main person in charge is unable to resume control after a disaster, designate in advance who will step into that role. “Small business owners need to have a power of attorney agreement with a trusted surrogate in the event the owner is unable to take care of business,” says Decker, “Good candidates are attorneys, CPAs, banking officers, trusted family members, or friends. This is to keep the business in operation until the owner can return or other suitable arrangements are made.”
Make a detailed emergency plan and review it
Having a specific, written emergency plan is key for every business, and being sure everyone knows that plan is vital. “Review the plan with everyone in your company and trusted advisors, [and] confirm everyone knows their roles in case of an emergency,” says Bremmer. “Bad things happen, but confusion and fear make them much worse.” He adds that, just like your annual budget review, look over your disaster plan at least once a year. “Review your plan as appropriate for your business. Last year's plan may not be viable any longer,” he says.
Michael Marchese, CEO of Tempesta Media, had a comprehensive review of all of his company’s business continuity procedures, which led to a revamp of operations. “We broke it down into increasingly perilous scenarios. For example, what would happen if our headquarters went down for one day? What would we do? How would we deal with a one-week interruption, one month, and one year? What happened if we lost a key member of the team? How would we react?” Marchese says. “We ended up creating about a half dozen scenarios ranging from a minor inconvenience to a potential company-killer.” This review of the plan led to several company-wide changes including cross-training of staff at all levels, moving operations to the cloud, implementing back-up mobile connectivity, and more. “Beyond being better planned for interruptions to the business, the improvements have helped make Tempesta Media more nimble and better positioned for growth,” notes Marchese.