Weathering the Storm
Preparing Your Business for Disaster Recovery
Many of us, myself included, operate businesses in the state of Florida. That being said, hurricane season is as much a part of our annual routines as tax season. From June 1st to November 1st each year, Floridians listen to the warnings, watch the forecasts and projected paths of impending storms, and stock up on non-perishable food, water, and batteries. Personally, we are prepared, but what about professionally?
Disaster preparedness and recovery go far beyond Florida and its susceptibility to devastating winds and torrential rain. There are, of course, an ample supply of natural disasters like hurricanes, tornadoes, floods, and earthquakes, but what about what we saw last year in terms of a global pandemic? That was utter devastation, the scope of which remains difficult to comprehend. There are also accidents, acts of violence, power outages, and equipment failures. In each of these situations, your business must be able to navigate through the hardships and challenges and get to the other side. And the sad truth is that many will not. In fact, according to a Federal Emergency Management Agency (FEMA) report, 40% of businesses never reopen after a disaster.
It’s time to take stock not just of water and batteries, but of cash, insurance, and disaster recovery plans. It’s time to ensure our businesses are as prepared as our homes. It’s time to safeguard ourselves against becoming a statistic.
It’s About Minimizing Risks
This hurricane season seemed like the perfect opportunity to provide some reminders about what you can do as a business owner to minimize your risks and prepare for the worst, as you hope for the best in any disaster. Here are ten crucial tips:
1. Assess your risks (internal and external) and your critical business functions.
2. Create or update your disaster recovery plan. If you don’t already have one (I hope you do), stop reading now and go create one (then come back and read on!) – it’s that important. This document will outline how your business will recover from a catastrophic event, such as a hurricane. When developed correctly, it should allow your business to recover as quickly as feasible, depending on the source of the disaster. Implementing the procedures set forth within the plan should be your first priority after ensuring your employees are safe. At a minimum, your plan should include:
- The identification of a disaster recovery team or individual who will take primary responsibility for implementing the plan.
- A crisis communications plan, including a phone tree, so critical information is communicated to employees quickly and efficiently.
- A list of critical business tasks that must occur regardless of where the work is taking place (assuming you’ve been evacuated and cannot get back into the office).
3. Ensure you have sufficient cloud storage and back up of important business documents. Access to these documents is essential to continuing operations.
4. Secure a line of credit designated only for emergency use. This can help you continue payroll, purchase new equipment, or even lease temporary office space, if needed.
5. Review your insurance policies to determine what type of coverage you have before it’s too late. For example, once a hurricane is forecasted, you cannot secure certain types of coverage.
6. Ensure you have enough cash on hand to operate if revenue-producing activities must cease for a time.
7. Automate your accounts payable process and the receipt of cash. Having paper checks waiting to get deposited at an office can stop your cash flow unnecessarily. Sending paper checks that require signature is a disaster you don’t need while coping with another disaster.
8. Gather emergency supplies in the office and in another location if access to the office is restricted.
9. Test your disaster recovery plan.
10. Stay safe!
Unfortunately, disasters are a very real part of life. And while there may be some disruptions and loss that are outside our control, minimizing the effects of a disaster on our businesses is well within it. Otherwise, these disruptions can lead to lost revenue, damage to reputation and brand management, and unhappy clients or customers.
Barker Associates has a proven track record of solving problems by developing strategies to minimize the risks and effects associated with disasters, so that businesses can continue to operate through them. We can assist in determining effective solutions that will help you navigate the troubled waters of potential disasters. If you need assistance, or have any other questions, please click here to schedule a 30-minute consultation at a rate of $100.