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Preparing Your Business for Natural Disaster - Why You Need a Plan, and What It Should Include

Hurricane Harvey tore through Texas just a short time before Irma made landfall in Florida. Just weeks later, wildfires ravaged some of the most beautiful parts of California. Each of these natural disasters caused plenty of damage to businesses and homes in these regions. Hurricanes and fires are just the beginning; floods, earthquakes, and other natural disasters can easily derail your business and make it difficult for you to get back on track.

Even if your business avoids the actual physical damage that a flood or storm can cause, the aftermath can still be devastating. Whether roads prevent people from getting to you, looters take over, or your network is damaged, you will still have trouble recovering and getting back on track.

A single natural disaster like an earthquake or hurricane can wipe out a small business in seconds. Despite the high toll a disaster can take on a business, many small and mid-sized businesses are often totally unprepared for emergencies; lack of preparation makes it even more difficult to recover after an event.

An emergency plan will not protect you from a disaster, but it will make it easier for you to recover after an incident and ensure you are able to continue serving customers and generating revenues.

Don't Wait – Protect Your Data and Network Now

You may have a plan, but how often do you back up your critical data? If your actual physical location is damaged by a natural disaster, you may not be able to access your servers at all. Maintaining critical data and records, from your customer lists and preferences to your inventory and even your HR and employee documentation, ensures you have what you need to get up and running again in a hurry.

Your disaster plan should account for storing copies of these critical records in the cloud or in a secure location miles from the original so they can help you get back on track in a hurry when you need to. If you simply back up your records on a device that is stored in the same location or on the same property as the original, you risk losing both places—and all your data—if a natural disaster occurs.

Create a Formal Recovery Plan

According to CNBC, less than 40 percent of all small businesses have any kind of plan for emergency recovery, and even fewer brands have a formal, up-to-date plan in place. Creating a formal document and procedure that outlines exactly how you will cope with emergencies can help reduce the amount of downtime you experience and prevent you from missing out on important calls, meetings, and opportunities.

Investigate Insurance

You need to thoroughly review what your insurance policy offers well before a natural disaster strikes. Do you have business interruption insurance to protect you from lost income? What happens if you have a home-based business and your home is damaged; does homeowner’s insurance cover business losses? (Probably not.) Flooding, wind, and other natural hazards may not be included in your regular policy, so knowing which of these types of disasters you are likely to encounter can help you determine what type of policy you need to mitigate risk.

Know Your Risk

If you live in the usually sunny southeast, a hurricane could impact your business, even if you are hundreds of miles from the shore. Big brands like Disney, Universal Studios, and Sea World all closed huge theme parks when Hurricane Irma struck, even though Orlando is hundreds of miles from the point where this massive storm made landfall. Not only did every smaller business in the area shut down, but these smaller locations had to get in line behind the bigger businesses in the area when it came to power restoration and other services. If your business is not a household name, expect to wait a while for restoration of power after an event and plan accordingly.

Much of your natural disaster risk will depend on where you live; your risk of tsunami is small unless you are right on the coast, but flooding can happen anywhere. Fire is always a risk, but places with huge natural forests or dense populations are more likely to experience the kind of rapid spread that creates a natural disaster situation.

Prepare to Protect Employees and Guests

You will need to be able to account for all your team members if they are working when an emergency occurs, or reach them when you need to. Your employees are one of your largest assets, particularly when it comes to recovery, so have a plan in place for safeguarding your team.

In a disaster situation, your employees may even need to shelter in place for a period of time that is longer than expected. Having everything you need on hand to cover this eventuality can give you peace of mind that you are ready, no matter what happens outside. Your facility needs an emergency plan that specifically addresses the security and safety of your team, any visitors or guests, and any customers on site when disaster strikes. Once the people are safe, you can begin to recover and reorganize your key systems.

Your business' emergency plan needs to have guidelines for safe evacuation of your buildings, a secure location for bad weather sheltering, and even lockdown protocols to prevent looters or those seeking to harm you from accessing your business after an event. Offering on-the-job training for emergency planning can also pay off. When your employees are equipped to handle disasters at home and at work, they will be better able to support your business and return to work after an event.

Evacuation Routes

Plan and post evacuation routes, even if the only people in your facility are the ones who work there daily. Even a familiar environment can become overwhelming and confusing in an emergency, and these details will help your employees reach safety when they need to. The right emergency lighting is a must and can help your team evacuate, even if you no longer have power.

How Vulnerable Is Your Business?

Understanding the climate and region your business is in will help you determine how much risk you face. If you have multiple units, your store across the street from the ocean has a much higher flooding risk than the one perched atop a mountain peak.

Finding out the typical types of emergencies your area has experienced in the past can help you plan and prepare. Your local government can assist you; a Hazard Vulnerability Assessment (HVA) likely already exists for your town or county. Use this to determine how close you are to trouble zones. Any of the following could increase your risk if they are near your business:

  • Flood plains
  • Seismic faults
  • Dams
  • Nuclear power plants
  • Power plants
  • Large bodies of water
  • Unmaintained forest land
  • Volcanoes

Your fire department or police station may also be able to provide you with information you can use to help determine your risk. Depending on the type of risk your business faces, a visit from a contractor specializing in risk mitigation can help. If you are in an area prone to earthquakes, your business could be secured to prevent shifting and damage.

Take Steps to Protect Your Business

What can you do to ensure your employees, your assets, and your business is safe? Part of creating an emergency plan is simply getting together with your team and discussing all the possibilities. A committee or team can work together to create an emergency response team and protocol that can be implemented as needed.

  • Create an emergency response and planning team – Pick leaders from each division or location, if possible, and talk about risk, your preferred response, and what you can do to keep your on-site team safe. You will need to come away with clearly defined protocols for any potential disaster. You should have a clear idea of the role each employee will play during a crisis. If your employees are stuck on site in an emergency, who is in charge and what do they need to do? Your emergency plan should include details about safety procedures and for securing your business once it is safe to do so. The person in charge during an emergency situation may not be the same person who runs your brand or business; an HR or security team member familiar with your plan and emergency operations is often a better bet. This team member can immerse themselves in planning and preparation to ensure your employees are safe during an emergency.
  • Order supplies needed – You will also need to order any supplies you need well in advance. Knowing you need a first aid kit is only the beginning—you need to actually implement all stages of your plan and have everything you need on site to fully protect your team and brand, such as safety equipment specific to your environment and risk, first aid kits for each office or location, Automatic External Defibrillators (AEDs), smoke and CO² detectors, fire extinguishers, and shelter-in-place food and water supplies. Having these items is a good start, but your employees also need to know how to access and use them.
  • Communication – One of the first things you will need after an emergency is a way to communicate. You will need to be able to connect internally, but also with local emergency officials and families of your workers. While your systems may not be operational right away, outlining how you want communication to work and what team members should speak with the media and emergency response workers can help prevent problems later.

Continuity of Operations Plan (COOP)

Once the natural disaster has passed and you have secured your team, focus on getting your business operational again. Creating a Continuity of Operations Plan (COOP) can help you respond in an emergency and ensure you are back on track as quickly as possible. This plan should include:

  • identification of essential team members and business functions;
  • procedures for suppliers and vendors who are important for your daily operations;
  • a plan for running your business if key structures or facilities are not functional or available;
  • details about accessing your electronic backups and network data; and
  • hard copies of essential documents needed for restoring your business, from your insurance information to your important data and paperwork.

Your COOP needs to be in hard-copy form and stored in a fire safe or other secure location. Multiple copies (some stored off site) can help ensure your team can access this important document when you are ready to begin recovery.

Your emergency plan should anticipate the most common situations; include detailed and actionable steps for securing and safeguarding your people, data, and physical structure; and have a detailed recovery plan in place. Once you have these components, you will be better equipped to restore operations and act decisively, even in the chaos that is part of the aftermath of a disaster situation. You cannot prevent a natural disaster, but you can minimize the impact it has on your team and ensure that your business is ready to resume operations as quickly as possible in the aftermath.