Preparing for Business Disruptions: Strategies for Disaster Recovery
As a business owner, it’s important to understand that disasters can occur unexpectedly. Whether it’s a natural disaster like a hurricane, earthquake, or wildfire, or a man-made event like a cyberattack or power outage, these disruptions can greatly affect your business operations. To minimize the impact on your customers and employees, a disaster recovery plan is crucial to keep your business running smoothly.
1. Identify Your Critical Business Functions
The first step in preparing your business for disruptions is identifying critical functions that need protection, including IT systems, communication channels, and key personnel to prioritize essential operations during business disruptions. Consider what functions, if you were unable to utilize, operate, or access, would freeze up your business instantly. For most businesses today, that includes computer systems and more. Keep the following aspects in mind to identify what parts of your business fall into this critical business function:
- These systems are most affected by downtime.
- These systems ensure that your business's financial or legal obligations and cash flow remain functional.
- These systems play a main role in maintaining either your business function, reputation, or market share.
- This system safeguards an irreplaceable asset.
2. Develop a Disaster Recovery Plan
The second step to prepare for business disruptions is to develop a disaster recovery plan. While no business owner wants to imagine their business unable to function normally due to unforeseen circumstances, creating a recovery plan will make the process much easier if the worst actually happens. Develop a recovery plan with procedures for data backup and recovery, communication, and ensuring safety. Then test and update this plan regularly to ensure it remains effective and applicable. In other words, don’t come up with a plan and then never test it out to see if it would actually work as designed, but test it and find out. Now, not later. When there isn’t an actual emergency, not during the midst of one, is the time to work out the kinks of your plan.
3. Invest in Insurance Coverage
Admittedly, insurance coverage is one of the few purchases you make that you sincerely hope you will never have to use. However, thankfully, if you do have to use it, insurance coverage can help you financially recover from a disaster. In fact, business interruption and property insurance can cover repair and replacement costs, effectively saving your business from calamity during a disruption. Talk to your insurance agent about your coverage to ensure that it covers your most important business elements and lasts until the end of the interruption period. In some cases, you can get additional coverage to extend protection if you are worried about getting everything up and running quickly enough.
4. Secure Your Data
Next up when preparing for a worst-case scenario of business interruption is securing your data. To avoid data loss during a disaster, regularly back up your data offsite or in the cloud. Investing in cybersecurity measures like firewalls, anti-virus software, and employee training to protect against cyber attacks is also a good idea. Here are some helpful additional tips to keep your business data as secure as possible:
Conduct cybersecurity audits
This looks for gaps in your protection and actually looks to find loopholes that can be exploited, which can then be repaired or closed.
Create a plan for what to do if a data breach happens
This includes a plan to notify the authorities, customers, and employees.
Backup your data
It is vitally important to back up any and all important data for your business because you never know when disaster will strike, and you will be left scrambling to access this information.
Understand who accesses what information and why
If a data breach happens, you will need to know what employees access what information and why and the passwords and all the other information that will be necessary to recover data. Waiting for a breach to happen isn’t the time to gather this information.
5. Communicate With Employees and Customers
Last but certainly not least, make sure you communicate with your customers and employees in the event a disaster strikes. Communication is crucial during a business disruption. Therefore, it’s important to have a plan as mentioned above and a plan in place for notifying applicable people about the plan. While that might sound convoluted, it really is just creating a plan to implement and getting the word out about your plan to your employees quickly and effectively. This can be before the disaster strikes of course, but also should be restated after the event happens, to remind employees and customers alike what your brand is doing to get any issues resolved and business functioning normally again.
Prepare and Plan to Overcome
It’s up to you as a business owner to prepare for disruptions, allowing your business to run smoothly, no matter what happens to affect its operation. This means you need to identify critical functions of your business, what you cannot function without, then create a recovery plan to get it back up and running asap. Next, you will want to secure your data and communicate the plan well to all involved. Finally, ensure you invest in good insurance to prepare for the unexpected curveballs life throws.
Contact Arnold Insurance to learn more about the types of coverage that can protect your business from disruptions and get you back to making money and doing what you love. Do this to be ready for unexpected challenges.