Extreme weather conditions in recent months due to climate change should be a reality check for businesses all over America.
Severe storms have brought unprecedented snow, rain and tornadoes, crippling cities and killing dozens of people. In Southern California, El Niño has caused record rainfall levels and associated mudslides, underscoring the need for having a basic disaster recovery plan.
When people think of disasters, they generally think of flooding, earthquakes, tornadoes or hurricanes (i.e., catastrophic events that devastate communities). But for a business, a disaster can be something as small as a failed server, building fire or a burst plumbing pipe. These events rarely make the news, but can have a devastating impact on a business, often bringing operations to a standstill.
Disaster recovery is a risk control technique. Risk control is anything a company can do to lower the frequency and severity of a claim. Disaster recovery won’t reduce frequency, but it will definitely reduce severity. In some cases, an effective disaster recovery plan, supported by a correctly written insurance program, can be the difference between a business’ survival and failure.
Below are some thoughts and lessons learned from the many natural disasters that have occurred in recent years about how to better prepare a workforce so employees can return to work in a timely manner.
- Cross-train employees. Regardless of a disaster’s impact on a business, if employees’ families are displaced or affected by a crisis, they will respond to their families first and their employer second. A company needs to ensure it can continue operations if key personnel are unavailable due to family emergencies.
- If a “work from home” scenario is part of a company’s disaster recovery plan, it must plan for the risks of power loss, communication interruptions, inconsistent Internet access and the inevitable distractions encountered when staff are working in a home environment.
- If employees must be in the office, how will they travel to work when public transportation and fuel are cut off? Businesses should consider establishing carpool protocols or hiring a transportation service. For future events, they should consider storing fuel onsite for distribution to key personnel. It’s important to follow official guidelines for fuel storage and distribution.
In every crisis communication is the key to recovering quickly. As such, when planning, communications should be a top priority. Below are some suggestions that might allow companies to better develop their crisis communications plan.
- Having a single carrier for phone, Internet and mobile access is a major point of failure. It’s wise to diversify communications providers to provide an extra layer of resilience.
- Mobile service is a typical bottleneck during a regional crisis. For example, during Hurricane Sandy, smartphone power and network access were either limited or simply not available. It’s good to have a solar-powered or hand-crank charger for mobile devices. Certain businesses might need to consider satellite communications tools, including phones and Internet providers.
- When bandwidth is limited, text messaging might be the only means of communication. Company managers should know how to send texts to employees, staff, vendors and customers. They should consider implementing a system for sending mass texts or email-to-text messages.
- Management should think about the different audiences they must communicate with immediately following a disaster: family, employees, partners, investors, vendors and customers. What is the message to each audience? If the company communicates effectively, most people will be able to accommodate short-term disruptions and will remain loyal customers. However, if they don’t communicate at all, customers might simply find the next provider.
Sometimes the smallest detail can have the greatest effect on a company’s ability to recover during a crisis. Here are a few tips.
- Be familiar with local emergency management, political leadership and law enforcement. Knowing these leaders can make or break a firm’s recovery when it comes to outside assistance making it into a restricted area, or finding out key information that can aid in its recovery.
- Document, document, document. Take pictures before, during and after the crisis (if it is safe to do so). It will help aid the recovery effort and ensure that insurance has enough information to quickly and properly process claims.
- Knowing the electrical demand ahead of time is critical. It can save time and potentially thousands of dollars when making decisions in the midst of a crisis.
- If a generator is elevated to avoid flooding, it’s important to make sure the fuel supply is elevated as well. Fuel sources or pumps to deliver fuel to a generator that is below or at ground level can be compromised by floodwaters. Additionally, any generators elevated above ground will be difficult to refuel. During Hurricane Sandy, some hospitals were forced to hand-carry containers of diesel fuel up dozens of flights of stairs to refuel rooftop generators.
- There should be more than one fuel vendor available. Perhaps no other frustration attracted more media attention than the lack of fuel for both backup generators and vehicle use. Supply lines can be interrupted hundreds of miles away, affecting supply, and local rationing can be imposed at any time. It’s best to have multiple vendors in the event a primary vendor’s operations are interrupted.
A disaster recovery plan is something every business needs, but something most businesses don’t have. Why? Most people simply don’t know where to start. There are a lot of moving parts, and just about every aspect of a business needs to be included. While a company might be able to create its own plan, it’s best to have help.
Begin by sitting down with an insurance agent to make sure the company is insured for potential risks, and consider business interruption insurance, which may compensate for lost income should a disaster occur. Be sure to keep photos of the building, equipment lists and policy information stored in a safe and secure offsite location.
There are companies that specialize in helping businesses create disaster recovery programs. Regardless of whether companies use a specialty vendor to help build their plan or elect to devise one themselves, the key is having a plan.