You can’t predict the unexpected, but you can prepare. A Business Continuation Plan (BCP) costs almost nothing to produce but is critical to recovering losses, and customers, after a disaster. This three-part Disaster Recovery blog series will address important considerations for business continuity after a disaster.

No one ever expects a disaster to occur. However, disasters occur every day. That’s why insurance is so valuable. When you consider the odds, you probably should expect to experience a disaster of some sort at some time in your career. But, you still do not know what to expect or when to expect it.

Being prepared can make it much easier to manage your business through any disaster, serve your customers while you are recovering and get back to business as usual more quickly. Insurance is a helpful financial component, but preparing a complete recovery plan can reduce the likelihood that your customers will feel the pain of your disaster.

How can you prepare for a situation that you cannot predict?

Disasters come in many varieties. A disaster is defined as an event that makes it impossible or very difficult for your company to conduct business in a normal manner. Think about how your business would handle the following scenarios:

  • A hurricane or Superstorm Sandy, formerly known as Hurricane Sandy, floods your business, eliminates power in the entire state and displaces your family and most of your employees.
  • A winter ice and heavy snow storm causes widespread power outages in your city and throughout the state. The snow and ice make it difficult to get around and it takes several days for the power company to return power to your business. You and your employees experience difficulty getting around town, closed stores and food shortages.
  • A tornado damages your business building and destroys several square miles of your city. Some of your employees’ homes have been destroyed. Your home is spared but your parent’s home and your brother’s home were both heavily damaged and they are looking for a place to live.
  • A train derails one-half mile from your business. Several liquid petroleum cars are damaged and catch fire. The 4 square mile area around the fire is evacuated due to the toxic fumes caused by the fire. The fire finally burns itself out after 10 days.
  • You are on vacation in Cancun when a terrorist attack occurs on U.S. soil. The Federal Government shuts down all air flights for several days and you are not able to return to your business until 5 days after you expected to return.
  • Your in-house computer expert that knows how to make your computer system work on a daily basis is injured and will not be able to return to work for four to six weeks.

BePreparedHow your business would be challenged by each of the above scenarios depends on your business model. Business owners use technology, communications and key employees to make their businesses better. These are the tools required to meet customers’ expectations. When these services are no longer available, an alternative plan is necessary.

When you develop disaster recovery plans, they should be flexible enough so that you can work through any difficult situation. When a disaster occurs, you can then assess the type and size of the event and make educated decisions about which parts of the plan you need to use. A flexible and nimble plan will pay dividends no matter what disaster befalls your business.

To create a business continuation plan, identify the processes or tools necessary to keep your promises to your customers. The highest priority items need the most attention in your recovery plan. Business processes that are not as important can be delayed during a disaster recovery time. If you have a computer program, a list of phone numbers or a particular process that is the key to your business, make sure that you will have that process available as soon as possible following a disaster. If the process relies on a computer, consider having the program running and ready at a remote site. If the process relies on one key person, cross-train someone else to be able to perform the work and document the process so that the secondary person can fill in if the key person is no longer available.

The more effort you put into considering what it would be like to recover from a disaster and what processes are essential, the more successful your recovery will be.

Take the time to develop a written recovery plan, share that plan with your employees, and have the plan and any other resources available from an alternate location just in case something happens to your main building. A few minutes, a few hours or a few days of planning can make your recovery from any disaster much easier. When you have a plan, you, your employees and your customers can be confident that your business will recover.

-Ken Stephani, CPA, CIA