I had just been hired by a company to help it turn things around when there was a fire in the corporate office. Now, as a Turnaround Authority I had come in to “put out fires” before but this was the first time we literally had flames!
Fortunately, the company’s records were backed up once a week. Unfortunately, the person designated to take home the back-up every week so it would be in a separate location was out sick that day. In addition to everything else that was lost, a week’s worth of records were unrecoverable.
While this company eventually recovered, some don’t ever recover from a disaster. They lose weeks of production resulting in the loss of sales, profit and customers. Even if a company has business interruption insurance, it may not be enough to cover the losses suffered. And it won’t get your customers back.
In last week’s column I discussed the need for every business to have a continuity/disaster recovery (BC/DR) plan and the three elements that should be included: how employees will communicate, where they will go and how they will continue to do their jobs.
This week I’d like to address how you get started creating one. It is an extensive document and can be an overwhelming process, but there is help.
There are a lot of great resources for businesses on the Federal Emergency Management Agency (FEMA) website, including this helpful diagram of the four steps of an effective BC/DR plan.
Step One: Business Impact Analysis
The first step is to gather information to evaluate how your business will be impacted should operations be disrupted. Conduct a risk assessment and look for areas where your business may be vulnerable should a disaster occur. For example, does your building have an operational sprinkler system and are your fire alarms fully operational? Do your employees know what to do in case of fire?
Use a Business Impact Analysis Worksheet that breaks down the operational and financial impacts according to the timing and duration of the disruption in business operations. For example, a company that distributes gardening supplies and experiences a disaster in January will be less affected than if the same disaster occurred in April, a busier time of year. And obviously, a power outage that lasts a few hours is much less disruptive than one that may continue for several days.
Step Two: Recovery Strategies
Using the information you gathered in step one, document and identify your options for recovery and areas where you may need to fill in gaps. You may have identified that you don’t have current information on how to reach your employees in the event of an emergency. Perhaps an alternate site that you had previously identified for relocation is no longer a viable one or your technology needs have changed.
After selecting strategies that will work for your company, have management approve them and then begin to implement those strategies.
Step Three: Plan Development
Develop the framework of your plan. You may wish to use the Business Continuity Plan form that is provided on the FEMA website. The form will help you organize the business continuity team and addresses interaction with external organizations. Who will contact your vendors and contractors? The form includes a place to list all your vendors and contractors along with their contact information.
Step Four: Testing and Exercise
The last step includes developing an orientation exercise and testing for the business continuity team. Employees need to understand their roles and responsibilities and have a firm understanding of all the procedures involved.
After conducting testing, incorporate any lessons learned or gaps that were discovered into your plan.
The FEMA website also has Business Continuity Planning Suite software that you can download to help your business create, improve or update your business continuity plan. The software includes a 30-minute video-based course to get you started. And that is an important step if your business does not have a BC/DR plan — get one started.
Look for me November 10 at 4:30 at the Book Festival of the Marcus Jewish Community Center of Atlanta. I’ll be discussing my book, ”How Not to Hire a Guy Like Me: Lessons Learned from CEOs’ Mistakes.” The event is free and open to the public. Click here for more information.