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Creating a Disaster-Preparedness Plan

Guest post by: Barbara Weltman

Article Overview: According to a Traveler's survey, 44% of small businesses do not have a business continuity plan and only 36% have ever spoken with an insurance agent about developing one. This is despite data from the American Red Cross showing that 40% of small businesses do not reopen after a fire, storm, or other disaster. Here are some ideas to help you get prepared.

Creating a Disaster-Preparedness Plan

According to a Traveler's survey, 44% of small businesses do not have a business continuity plan and only 36% have ever spoken with an insurance agent about developing one. This is despite data from the American Red Cross showing that 40% of small businesses do not reopen after a fire, storm, or other disaster. Here are some ideas to help you get prepared.

Make the time to plan

The Traveler's survey found that 39% of small business owners were unable to find the time for managing operational risks. But disaster planning should be a priority for all owners who need to make the time to plan. Why?

• The plan can save lives and the business. Unfortunately, too many business owners think that disaster will never happen to them. Disasters can arise from many things: storms or other natural occurrences, fires, terrorist attacks, and health threats.
• The plan can save you money now, even if you never experience a disaster. Talk with your insurance agent about cost savings by having a disaster plan in place.
• In some cases, planning is mandatory under federal, state, and/or local laws. For instance, OSHA requires an emergency action plan in some situations. The plan must be in writing, although employers with 10 or fewer employees are permitted to communicate the plan to their employees orally.

Assess current risks and plans

If disaster were to strike your company today, what would happen? The American Red Cross may be able to help you do a risk audit.

• In some locations, the American Red Cross offers programs through which continuity of operations plans (COOPs) are individually reviewed. Reviewers then make recommendations on how a business can to be better prepared. John Ravitz, CEO in Westchester, NY, has found that some companies initially think they are prepared because they have made plans. On closer review, they often find that the plans are old and outdated, and in serious need of revision.
• In other locations, the American Red Cross holds seminars on COOPs; check with your local chapter for information.

Note: These American Red Cross COOP services are fee-based. There is a charge for personalized audit and recommendations engagement (the amount depends on the menu of services utilized) and is probably suitable for larger companies. Attendance at a seminar may cost only $100 and can be just as useful for small business owners.

Train for and practice preparedness

Companies may want to invest in disaster skills training. For example, companies can sponsor employees to take OSHA-compliant CPR and first-aid courses. Businesses that keep defibrillators on site, such as health clubs, may want to expand the number of personnel trained to operate the machines.

Like fire drills in schools, your business should conduct practices to ensure that personnel know what to do in an emergency. For example, if you pay to have staff trained in CPR, you'll want to have practice drills to be sure that they can respond properly if there was a real need. Ravitz worked with one company that held a practice drill where some employees trained in CPR froze; this helped the company identify the need for training additional staff.

Resources

• American Red Cross' Emergency Preparedness Checklist for Small Businesses
• FEMA
• Institute for Business and Home Safety
• Ready [dot] gov
• SBA's Prepare My Business

Note: Other aspects of a disaster preparedness plan, including insurance coverage and data backup, are discussed in the June issue of my monthly newsletter.

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Article Tags: business plan, continuity, disasterpreparedness, insurance, risks



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