Disaster Contingency Planning

When people hear about disasters that have occurred, they often think something like that would never happen to them or where they live. That is the kind of mindset that can leave you unprepared and scrambling if a disaster were to strike—especially in the business world, where a disaster could set a business back many years.

The Merriam-Webster dictionary defines disaster as “a sudden calamitous event bringing great damage, loss, or destruction; a sudden or great misfortune, or failure.” We hope you and your business never have to face a disaster, but there are plenty of things you can do to prepare.

You should start by thinking about disaster contingency plans now—don’t procrastinate. After your emergency procedures and evacuation plans have been established and a competent and financially strong insurance partner has been selected, you may feel that your disaster planning is complete—but it is just beginning.

Start by ensuring that all of your electronic and paper documentation is backed up. If you have paper documentation, you should think about digitizing it. Once all of your documentation is available electronically, it is easy to back up. Documents should be backed up every 24 hours and stored on the cloud or on rented servers that are located off-site.

Take an inventory of your entire building. Document your building space from floor to ceiling, including any special utility needs such as three-phase power, floor-thickness requirements for heavy machinery, and any other special needs. Verify the minimum number of loading and shipping docks needed to ensure daily business operations can resume quickly.

This is also a good time to consider having your own backup generator. If you have a need for continuous power to maintain freezer storage or pump systems, you should invest in a generator to help avoid a costly loss to your product due to a large power outage.

Identify potential buildings in your area that you could occupy if you were to lose your facility. A local commercial real estate agent might be able to assist you in the search for potential backup buildings. You might have to look at multiple buildings if you can’t find one that is able to house all of your operations. Also, pay attention to your transportation needs. If you receive supplies by rail or ship, make sure your backup location has the same capabilities. If you receive heavy shipments, check the bridges that lead to the back-up facility to ensure they can handle the load if necessary. If the infrastructure of the backup building isn’t able to handle your shipping requirements, you may need to break shipments into smaller sizes or make other adjustments to keep your business running.

Take an inventory of all your equipment. Make sure you have the original manufacturers’ information, including serial and model numbers. If you have custom equipment, ask the manufacturer to supply prints and documentation, so it can be rebuilt or repaired if necessary. Document how your equipment is hooked up to power, gas, or other utilities. Take pictures of your layout and setup to make it easier  to recreate.

Look for alternative equipment suppliers and document those options. In a large-scale disaster like Hurricane Katrina, your local equipment distributer might be impacted, so it’s important to have additional suppliers and manufacturers identified.

Establish a staff response list and assign responsibilities. Identify important tasks and the order in which they need to be accomplished. It won’t do you much good if employees report to your backup location and there’s no material or equipment available for them to work on.

Develop a plan to ensure you can communicate with your employees, customers, and suppliers. Your business partners need to know if you can’t fulfill your commitments. Your employees need to know what is happening and what they should do. Depending on what happened, you might not have work available for a few days or several weeks Communication is key, and it is important to have a plan ready to go.

You might want to connect with competitors to see if they have capacity you can “buy” if you are down. You might make arrangements to have your employees work on your orders in their facility. Customers will leave if you can’t supply them, so an established relationship with your competitors might help you save your business in the long run.

Your business is your livelihood, and you have invested a lot of your personal time and money in it. Establishing a business contingency plan now—before disaster strikes—can help ensure an unexpected misfortune doesn’t jeopardize the future of your business.