Don’t Let a Disaster Derail Your Business

With the frequency of natural disasters, mass shootings and cyber threats, it’s important that your business is ready if it faces its own disaster. According to Liberty Mutual Insurance, most small businesses don’t have formal disaster recovery plans. As a result, 40 to 60 percent of them permanently close after one strikes. Don’t be part of that statistic. Here are three steps to creating a plan.

1. Assess your risk

First, choose members of your disaster team including IT, HR and your business advisors, and meet to identify possible threats. Consider your physical locations and the hazards unique to your region. Create lists of risks your business would face including a loss of power, a fatal crash of your business systems and material damage to inventory and production capacity.

2. Appraise operations

Rank your most critical functions by importance and level of risk. What to include in your plan?

• Data backup – Where do you store critical information for each business function and do you have that data backed up in a secure system offsite?
• Employee logistics – Establish remote work arrangements, including employees’ physical, logistical and data needs.
• Insurance coverage – Does your policy include business interruption coverage? Should it? Discuss the alternatives with your broker.
• Taxes and recordkeeping – How will you evaluate losses? You’ll want a plan to keep detailed records and a supplier team to help determine the best approach.

3. Communicate and test

Document your plan so it is clear, accessible and easy to implement, and share it with everyone on your disaster team so they know who is responsible for what. Also be sure to test your plan annually.

Disasters may be unavoidable, but a comprehensive disaster recovery plan can help minimize your business downtime and losses. Alloy Silverstein has the expertise and experience to help you create a plan.

This article was published in Alloy Silverstein’s Fall 2019 Newsletter. Click here for more content or to subscribe.