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Be a Master of Disaster Planning

Business continuity requires a broader definition of 'disaster.'

December 13, 2010
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Plan components

Once a credit union decides to create a business continuity plan, there remains the question of what elements to include. Agility Recovery Solutions offers “Ready Suite,” an a la carte bundle of services credit unions can pick and choose from.

“We can run the gamut from temporary branch locations with complete facilities, such as a teller station and loan officer areas, as well as computers and furniture,” says Paul Sullivan, Agility’s vice president and general manager. “Or perhaps a credit union needs only satellite communications for voice and data, or a mobile temporary back office with workstations and office furniture.”

Emergency power is a major concern, he adds. “Seventy percent of all credit unions will have a power outage within the next 12 months, whether it lasts only minutes or goes for days. Often, the culprit is an aging infrastructure in many big cities. As it ages and is repaired but not replaced, power outages become more frequent.”

Agility, working from 80 North American depots, can have a standalone generator in place within four to six hours.

Sometimes potential clients will tell Sullivan they can acquire furniture, satellite links, generators, and mobile technology themselves after a disaster instead of paying someone to do it for them. “My response is simply, ‘Is this where your focus should be immediately following a disaster?’ ”

Sullivan understands that business continuity is yet another obligation heaped on credit unions, which don’t have the resources banks have.

“Credit unions could be well aware of the need for a recovery plan but don’t think they can afford it,” he says. “Also, with employees wearing so many hats, who’s in charge of recovery? Is it a full-time position? What must we sacrifice to be able to afford it?”

Some credit unions located within select employee group facilities simply hope the sponsor company will take care of them if disaster strikes.

Sullivan recalls a courthouse in an Appalachian county that had a fire. It took 10 days and $250,000 to restore IT functions.

“When we later discussed with an official how our $295 monthly fee would have allowed the courthouse to be up and running within hours after the fire, he said that amount was ‘spit in the bucket compared to what we spent to get back running,’ ” he says. “We thought, ‘10 days down? Would there be any point in continuing a business after so long?’ How many members would go elsewhere when they saw how slowly you responded?”

A common mistake is thinking a plan is the most important component of business continuity, says Sullivan. “The first thing you need is a place to do business if disaster strikes and/or arrangements with somebody who can come to you with essential facilities and services. I often ask, ‘If you were told today that your building had burned down last night, where would your people congregate and work?’ After that, you can create a formal plan.”

Some credit unions get bogged down in creating a plan, he notes. They’ll hire a consultant or cobble a plan together simply to please examiners.

“It never becomes a continuing process or a living, breathing thing,” Sullivan notes. “They never work the plan, it just gets put on the shelf to gather dust.”

Awareness, says Sullivan, is one thing. Taking action is another.

“The chilling statistic is that less than 20% of U.S. credit unions have a full-blown recovery plan in place,” he says. “They can’t meet the regulator’s criteria.”

Next: Disaster Recovery: Look to the Cloud

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