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Business Continuity Plan: A Must-Have Tool to Navigate Potential Crises
Most business owners face countless real-time issues every day as they work to establish and run their company. Often, the remote risk of a large-scale disaster takes a back seat to daily problems requiring concrete solutions. Yet, companies don't want to be left scrambling to keep their business operations afloat if a large threat arises. By devising a business continuity plan before a disaster hits, and reviewing the plan on an annual basis, companies can help ensure they will be able to satisfy their customers and deliver quality products and services, even in the event of a serious disruption.
Identify Potential Events That Could Cause Work Stoppages
To begin business continuity planning, devise a list of foreseeable events and map out ways these events could affect the company and its customers. The zip code risk search online tool provided by the Institute for Business and Home Safety may prove useful in generating a list of potential natural disasters in a company's geographic service area. Other, non-natural events to consider run the gamut from employee theft to computer viruses to equipment breakdown or malfunction. Often, just the act of listing these events triggers a host of potential responses, and helps identify weaknesses in business continuity which can be quickly and easily rectified.
Evaluate Crucial Business Processes
Once a list of events is created, decide how each one impacts crucial business processes. Crucial business processes are those which would severely diminish business operations if they were unable to be carried out. Business disruptions affecting external vendors and suppliers also may affect a company's business operations. Be sure to discuss business continuity plans with the company's most important business partners.
In addition to preserving business operations, crucial documentation also must be safeguarded and accessible. This includes financial information, small business insurance policies and customer contact information. By piecing together all critical processes and data, companies may begin planning alternative ways to keep their business operational during severely disruptive events.
Alternative Site Planning
Alternative sites may be required in circumstances such as a natural disaster or extended power outage. Companies with multiple locations over a wide geographic area have the option to shift operations between sites, but smaller businesses may need to look elsewhere to arrange for space. Some options include renting space in a separate location or seeking out a business affiliate in a different area. Alternate sites should be far enough away that they will not be affected as severely by similar weather events, but close enough to be accessible in the event the work space is needed.
Assemble Contact Information
When a business continuity plan kicks in, communications with employees, vendors and customers are keys to loss prevention. Employees must understand their individual responsibilities and where they need to report to work if a change in location is necessary. Many companies use phone trees or text messaging alerts to rapidly communicate instructions to employees. Arrange for communication with customers using a blast email, website announcement, phone message and social media to inform and update them about when the company intends to resume full operations.
Technology is the backbone of business today and one computer virus or system intrusion can bring companies to an abrupt stoppage. Many large companies have suffered after their systems were compromised and have lost the trust of millions of customers as a result. Investing in backup systems and protection that includes firewall, anti-virus and anti-spyware software is integral, and periodic testing of the backup systems also is essential. Offsite data storage is another way to prevent loss of data in the event of a natural or man-made disaster.
Quantify Small Events to Determine the Potential Impact of Large Events
Once a business continuity plan is set, begin quantifying the financial impact of events as they occur. For example, after a minor power outage, calculate the costs of employee downtime, the additional expense incurred while running alternate power sources such as generators, and any loss of information that needs to be recreated. By quantifying the overall impact of smaller events, companies will better understand how much a larger event may affect business, and processes can be established to ensure preparedness and mitigate customer impact.
Talk to a Cadence Bank Treasury Management specialist about solutions that can help your business prepare for the unexpected.