Chuck Meiers was nestled in his bed when the call came. “Is this Charles Meiers? The owner of the building at Morgan and Main, CM Towers? I believe your business, CM Law, is the sole tenant there?” “Yes?” “Sir, this is the San Valdeos Fire Department. We responded to a fire alarm at your building. There is a lot of black smoke coming out of your roof. It appears your building is on fire.” “Oh no, can you put it out?’ “We are attempting entry now, sir. It would be best if you could get down here. We need details as to the flammable contents of the building, as well as any fire protection measures in place. By the way, is there any reason to believe that anyone is in the building at this time?” “Just the security guard. He must be the one who sounded the alarm.”
Whether man-made or a force of nature, a disaster can spell big trouble for a small business. Not only could a disaster suspend business operations, it could effectively force you to shut your doors.
The first step to protecting your business, of course, is ensuring that you are sufficiently insured to protect against any potential loss that may occur when disaster strikes. The second is to have a comprehensive contingency plan in place. These two steps may enable you to reopen your business quickly and efficiently after a disaster strikes.
What qualifies as a disaster? Generally, anything that impacts the operation of your business for an extended period of time, resulting in significant financial loss, the loss of lives, or the loss of customer/public good will. Workplace violence, a fire, a system failure, a tornado or hurricane, data theft, employee embezzlement, or accusations of illegality all fall under the heading of a disaster.
There are many ways to create a contingency plan. Some small businesses simply gather employees, and using standard guidelines, hammer out the details. Others utilize a consultant or work with their property insurer. Whatever approach you take, the planning process should include consideration of the following potential risks to your business:
- Are natural disasters, such as wildfires, earthquakes, snow/ice storms, or flooding common occurrences in your area? Would someone benefit from tampering with or stealing data about your operations? Are your premises open to the public and therefore at risk of exposure to certain other risks, such as violence or other criminal acts? Focus on likely disasters, not ones that have little probability of occurring.
- An evacuation plan. When a disaster occurs, first consideration must be given to the preservation of human life. Does your business have a plan in place for evacuating employees when a disaster is imminent or occurs? If not, create one, and discuss it regularly with employees. Then post it in places with significant employee traffic, such as lunchrooms, restrooms, and stairways/elevators.
- How notification of an impending disaster will occur, methods of seeking shelter on the premises, securing computers and other property, how to safely exit the building, establishing a gathering point once evacuation has occurred, and the appointment of safety monitors to ensure the building or offices have been cleared.
- A communications plan. If the disaster occurs outside of work hours, how will employees be notified? If employees are sent home after a disaster occurs, how will they be kept updated on their responsibilities? Is a system in place for mass texts or notification by robo-call, or should employees visit the company website for updates, information, and instructions? In addition, how will customers or clients, as well as the public and the media, be notified of the disaster and the impact on business operations? Some companies create crisis communications plans that are designed to be executed by a specified group of people.
- Emergency preparedness. Certain supplies are essential in emergencies, such as first aid kits, food, water, blankets, and safety equipment, including face masks and gloves. Consult with local governmental agencies to identify what your business needs to keep on hand for specified emergencies.
- Protection of business assets. No matter what type of disaster occurs, it is essential that business information be protected. Storing copies of customer lists, financial data, and employee information offsite is key. Use of “a cloud” or a storage facility are among the alternatives that should be considered. There should also be a procedure in place for shutting down company computers, servers, and other electronic equipment en masse when evacuation occurs. That will protect against theft if the premises are left unprotected.
- Resumption of business operations. What will it take to get your business up and running again? Is there an alternative site available to continue operations or will employees be permitted to work from home? Will the business resume operations in stages, starting with key employees, then adding other employees as practical? Are procedures in place to provide employees with the equipment and data they need to work at a different location? What supplies/products will be needed to meet the continuing demands of clients or customers? Will alternative vendor/storage arrangements be required?
- Addressing the impact of the disaster. A disaster does not just impact a business, it impacts employees, customers, vendors, and the community. Create a procedure for addressing such concerns as the loss of income, the unavailability of services or products, maintaining goodwill with customers and the public, and connecting those impacted with local, state, and federal governmental and non-governmental resources.
Once these issues have been discussed, reduce the conversations to writing. Create a formal plan that outlines the company response to specific events and make it available to employees. In addition, keep it accessible off-site, for example, in the cloud, on company cell phones, or in a physical location, such as the homes of key executives. A plan is of no use if it cannot be accessed when needed.