Business Disaster Recovery Plan

Every organization, no matter the size, needs a business disaster recovery plan in place. Natural disasters often strike without warning and have the potential to be extremely dangerous. On a personal level they can be frightening and devastating, but the impact to businesses can be expensive and even dire.

Businesses along a street

Most major corporations have business disaster recovery plans or business continuity plans in place, but does your business? If it doesn't, it certainly should. Disaster recovery plans deal specifically with handling the aftermath of a natural or man-made disaster, while business continuity plans are a more comprehensive approach which deal with making sure you keep earning revenue even in a variety of bad situations.

Here is the basic approach for a Business Continuity Plan

You have to be able to deal with each of these questions logically and in an organized fashion.

What are the business's core functions and how are they supported?

  • Employees
  • Building, equipment and furniture
  • Computers, etc.
  • Documents
  • Office Supplies
  • Inventory (raw materials, finished goods and goods in production)
  • Utilities

What is the primary recovery strategy?
What alternatives are there to this strategy?
What are the financial impacts of re-establishing the core functions?
Who will lead the recovery team?
What is the impact to customers?

No Substitute for Planning Quote

There are companies which can go through the entire business disaster recovery process with you. They will first likely do what is called a Business Impact Analysis. This analysis attempts to evaluate your organization's risks and put a dollar figure to every process your company would have to undertake to re-establish functions if a disaster were to strike. It is a bit sobering, but very a very health process for every company to go through. If you really want to know where you stand, this will tell you.

Now what do you do if your business has just experienced a disaster and you have no plans in place? Unfortunately, many business owners find themselves in this position. Why? It is because so many people have the mindset that "it won't happen to me."

Sadly, natural disasters and man-made disasters occur all over the world and no one can predict when or where they will happen. They strike viciously and quickly, leaving hundreds and sometimes thousands of people behind to pick up the pieces of their lives.

If you are a business owner, this could mean the end of the line for your way of life.

Now, if you want a an inexpensive way to track your business finances (helps immensely at tax time, too), you need to consider QuickBooks Pro 2014 [D. It is cheaper than one trip to an accountant and it is way better than being audited by the IRS. Plus, all of your financial information is in one place.

After you get QuickBooks, save your data a flash drive and store that with your wallet, and you have everything you need to get your business going again from a financial document standpoint. You have lost nothing. Or, if you are afraid of losing a flash drive or want an additional source of back up (and I do this myself), use Dropbox. I save all of my important stuff there and it is free. I can access it from anywhere I get Internet access. You can also share files if you need or want to. Did I mention it is FREE?

What do you do if you don't have a business disaster recovery plan? How do you go about recreating your business?

Hopefully you keep backups of your data and have business insurance. Those two will be essential in getting your business started up again. Another essential element is your supply line. If your suppliers are also seriously impacted by the disaster, you may have to seek out new resources or find ways around the problem until it can be resolved. But, those are just things to consider. You really need to know what to do.

Let's start with step one:

This guide will present the THREE BASIC STEPS to creating simple, but effective business disaster recovery plan that deals explicitly with the aftermath of natural disasters like tornadoes, hurricanes, tsunamis, and the like.

Here are the three basic steps which will help you put your business back together:

  1. Contact Your Insurance Provider - This should be the first step in all business disaster recovery plans. Immediately contact your agent, even before you begin cleaning up or removing debris. They will guide you through what you need to do to safely establish your claim in a manner that will ensure prompt approval and payment. They may ask you to document damages with photographs, or you may be told to wait until an assessor can visit your property.

  2. Clean Up Safely - After you have been cleared by any emergency personnel to return to the site of your business, and have contacted your insurer, you can begin the process of safely cleaning up. This is where many business disaster recovery plans will slightly differ; every industry is likely to have specific enough concerns to make this step difficult to completely outline. The most important thing is that any cleanup work is done safely, by qualified professionals.

  3. Assess Impact on Business - The last step in most business disaster recovery plans will be assessing the viability/damage to your business after the disaster. While many businesses are able to recover, it is a sad fact that some do not. Evaluate your finances, your will to deal with the extra work of cleaning up and re-opening, and any effect on your local market that may have occurred as a result of the disaster as well.

So much is riding on how you handle an emergency situation. When you consider how much of your time and money is invested in your business, you don't want to potentially throw it all away by not setting up a disaster preparedness plan or an emergency contingency plan.

Additional Help

One resource you might want to look into is this book by Michael Wallace: The Disaster Recovery Handbook: A Step-by-Step Plan to Ensure Business Continuity and Protect Vital Operations, Facilities, and Assets. It will provide you with checklists and forms that you can use to prepare your company for all kinds of disaster situations. There is a CD included with the book.

Here is an additional resource which might be helpful. FEMA's Business Continuity Planning Suite. It is free, but it does not provide nearly the same kind of resources as the book mentioned above.