Whether your business is small, large, or in between, disaster doesn’t discriminate. Unfortunately, small businesses tend to be less prepared than large businesses for the unexpected, leaving them more vulnerable when disaster does strike. In fact, without a formal disaster plan, an estimated 40 to 60 percent of small businesses end up closing down after a disaster.
To ensure this doesn’t happen to your business, plan ahead with a comprehensive disaster recovery plan by following these eight steps:
- Complete a risk assessment.
Consider your industry, technology, geography, and daily operations. What interruptions are most likely to occur?
- Consider exit routes.
You and your employees need to know how to get out in the event of an emergency. Make sure these routes and exits are clearly marked and hold periodic drills to go over procedure.
- Form a recovery team with employees.
These employees should have essential skills and knowledge to help in the days, weeks, and months following a disaster. Consider including someone with expertise in technology, operations, and human resources so you can get business back up and running as soon as possible.
- Make a plan for alternate business operations.
Don’t wait until your office is unusable to establish an alternate work location or protocol for working remotely. Plan ahead for how the work will get done so you can minimize interruptions to your operation.
- Develop clear communication protocols.
The time period following a disaster is often fraught and confusing. Establish processes for clear, transparent communication with your employees, customers, the media, and any other essential stakeholders to ensure everyone stays on the same page.
- Clarify the recovery process for customer and supply chain interactions.
Even in the aftermath of disaster, you want to do what you can to meet your customers’ needs. Include supplier contact information in your disaster recovery plan to discuss any damaged inventory or customer orders that need to be filled.
- Plan for emergency accounting and payroll.
Due dates on invoices and the necessity to meet payroll won’t go away just because you experienced a disaster. Use a cloud-based accounting system and third-party payroll provider to ensure financial continuity and consider adding business interruption coverage to help combat some of the costs.
- Don’t forget cyber security.
The threat of a data breach should be taken seriously. Formulate a clear process with your IT department for what to do if your company experiences a breach.
If you wait to develop a disaster plan, you might discover that by the time you need it, it’s already too late. Planning ahead can ease the stress and turmoil immediately following a disaster—and help your business get back up and running sooner.
Get help starting a disaster plan today. Talk to an independent insurance agent for tips.
This website is general in nature, and is provided as a courtesy to you. Information is accurate to the best of Liberty Mutual’s knowledge, but companies and individuals should not rely on it to prevent and mitigate all risks as an explanation of coverage or benefits under an insurance policy. Consult your professional advisor regarding your particular facts and circumstance. By citing external authorities or linking to other websites, Liberty Mutual is not endorsing them.