Prepare for Disaster: 10 Steps

Seemingly minor events can have a shocking impact on a business.

October 20, 2010

When people think of disasters, they generally envision hurricanes, tornadoes, or floods—catastrophic events that devastate communities.

But for a business, a disaster can be something as small as a failed switch or a computer virus.

These seemingly minor events can have a shocking impact on a business, often bringing operations to a standstill.

Creating a basic, executable disaster recovery plan is one of the most important steps you can take to protect your business and ensure business as usual—no matter what the scenario.

Here are 10 steps to help you get started:

1. Assess your risk both internally and externally

Which disasters will most likely impact your business? Although major disasters dominate the headlines, most business interruptions are caused by everyday events, such as power outages, human error, and technology failure.

2. Assess your critical business functions

Evaluate and document how your company functions and determine which processes, employees, equipment, and materials are critical for your daily operations.

Subscribe to Credit Union MagazineCritical business functions include such things as billing, payroll, and service fulfillment. List these functions and determine a process for restoring them in the event of an interruption.

3. Plan for an alternate location

What would you do if your building were inaccessible tomorrow? Where would you go to continue basic business operations?

Review your site requirements and develop a plan for recovery. Alternate site options include your home, a branch or second location, the site of a similar business, or a vendor that provides mobile recovery.

4. Consider supply-chain preparedness

Recent surveys indicate that less than half of American businesses have disaster recovery or business continuity plans in place to maintain supply-chain logistics in the event of a disaster.

Talk to your key vendors and suppliers about their recovery plans. Develop relationships with alternate vendors in case your primary vendors experience an interruption.

5. Appoint a crisis manager and develop an emergency management plan

Planning what to do after a disaster is just as important as what to do beforehand. A crisis manager and sound emergency management plan helps facilitate a smooth transition between normal business operations and catastrophe response.

6. Back up your data and plan to restore your technology

In today's highly technical economy, information is more valuable than ever. Having an automated, daily back-up system for important data is crucial.

Store your data in an off-site, safe, and secure location, preferably 50 miles or more from your site. Regularly verify that you are able to retrieve your data.

Outline a plan to replace PCs, software, servers, printers, and fax machines should your office be destroyed.

7. Create an employee, vendor, and key client communication plan

Create a 24-hour phone tree for all employees and their spouses or closest relatives. Make sure your employees know ahead of time how to exchange or obtain information should standard lines of communication fail.

Also, compile a list of your critical clients and vendors and store it in an off-site location. Determine a process for contacting them should your systems go down.

8. Assemble an emergency kit

An emergency or disaster recovery kit should contain items such as fresh water, nonperishable food, flashlights, extra batteries, battery-powered AM/FM radio, first-aid kit, and copies of important documents and records.

For a complete list of recommended items, visit the Department of Homeland Security’s emergency preparedness site.

9. Examine your insurance coverage

Is your insurance coverage adequate? Talk with your agent to assure that you are insured for potential risks.

Consider business-interruption insurance, which may compensate you for lost income should you experience a disaster.

Store photos of your building, equipment lists, and policy information in a safe and secure off-site location.

10. Test your plan

Make sure your plan is workable. Test it annually and update the plan as necessary. Re-educate employees when making changes to the plan.

Remember, the ability of your business to survive depends on preparations made today.

BOB BOYD is president/CEO of Agility Recovery Solutions, Charlotte, N.C., a CUNA Strategic Services alliance provider. Contact him at 866-364-9696.