How to Prepare Your Business for a Disaster

emergency money jar

Disasters and missteps are parts of everyday life. They do not just affect homes and communities. They also affect businesses. Natural disasters like earthquakes and hurricanes can cause catastrophic damage to a business, but so can small events like a burst pipe or a loss of Internet service. Every time your business can not run effectively, you lose revenue. When operations come to a complete standstill, the results to a business can be devastating.

According to FEMA 40-60 percent of businesses affected by a disaster will never reopen their doors. But, as a business owner and leader, you can overcome those numbers by putting a disaster recovery plan in place. There are companies that will create these plans for your business. But, you will need to practice and implement the plan in case of a disaster, so knowing what goes into creating a disaster recovery plan is always a good idea.

Steps to Create a Disaster Recovery Plan

1. Know Your Threats

To begin, identity what major natural disasters your business is most likely to experience. It is easy to figure these out based on weather patterns and historical events. On this list, you will also need to add non-catastrophic, but equally impactful, possibilities. Consider everyday events that are possible such as human error, tech failure and issues with power or other services. Depending on your business, the weather and non-catastrophic events of your customers and clients may also need to be taken into consideration.

2. Know Your Roles

Identify who and what are essential to make the company run. Essential roles and tasks include those that focus on billing, payroll, and service fulfillment. Once you list the people, equipment and processes necessary for daily operations, craft a plan for how to restore these essentials should something interrupt them.

3. Know Where You Can Work

If your office location was no longer accessible, where could the business function? Create a plan that would enable you to continue basic business operations. This could be from a home office, a second branch or even a local business that offers space rentals. Decide what kind of space you need to continue and locate specific options that meet the needs.

4. Know Your Partners Plans

Discuss disaster plans with other people in your supply chain. Make sure these plans align with the others. Know how your vendors and supplies plan to deal with disaster and adjust your own plan accordingly. Also, be sure to reach out to clients to ensure they are aware of your plan.

5. Know Your Employees Are Cared For

Make sure your employees know their roles when it comes to disaster preparedness. Also aid them in forming plans with their families. Your employees are your number one asset. You need to know what you can expect from them in a disaster. Create a crisis communication plan so you can check in with employees to find out if they are willing and able to come back to work when disaster has passed.

6. Know Your Tech

Backup your files. Keep copies of important information in secure, off-site locations. Regularly check that you can retrieve that data and that it is up-to-date. Have employees practice rebooting systems from retrieved data.

7. Know Your Coverage

Check your business insurance coverage every six months. Make sure it is adequate. Keep photos and business plans in off-site locations in case you need to make a claim. Also consider purchasing business interruption insurance which will cover you if the business has to shut down due to disaster.

8. Know Your Plan Works

Test your disaster preparedness plan several times a year. Make sure it is clear and actionable. Be sure to train new employees on the policies and procedures. Listen to employee feedback about the plan and make changes as needed.

If you are working at a place without a disaster management plan but you understand the importance of having one, you might want to pursue a Master of Science in Leadership with an Emphasis in Homeland Security and Emergency Management at Grand Canyon University.

To learn more about how Grand Canyon University’s Colangelo College of Business keeps students up-to-date with the latest trends in business safety, visit our website or click the Request More Information Button on this page


The views and opinions expressed in this article are those of the author’s and do not necessarily reflect the official policy or position of Grand Canyon University. Any sources cited were accurate as of the publish date.