Ensuring Business Continuity After a Hurricane

 (by Tarran Dookie)

How does a business ensure that it gets back on its feet after a hurricane?

What measures must be taken to achieve the minimum possible interruption to the conduct of business and a return to normalcy as quickly as possible?

EVALUATING THE RISK

The business must evaluate the risk to the organisation should a hurricane occur. This evaluation may be done by a in-house risk manager (if there is one) or the function may be outsourced. The evaluation will determine the likely impact if there is serious damage to its buildings, plant, equipment and stock. What are the repercussions if the damage is nationwide? The business must envisage the possible consequences of a major hurricane so that the need for a hurricane disaster plan becomes apparent.

IS THERE A PLAN?

Is there a plan and is someone in charge? Without advanced planning, recovery would be haphazard.

Did top management approve of the plan? The person or persons in charge of the plan must have the full support of top management as otherwise the plan is likely to fail.

Is the plan documented and accessible to those who would need them? Has the plan been tested and failings corrected? There must be a system in place to ensure regular testing, adequacy and relevance. The plan must also be kept current and up to date.

INGREDIENTS OF THE PLAN

It is important that all the components of recovery are included in the plan. Is there an alternative site to conduct business from? This may be another branch or a building that is available to the business. It may be too late to think of renting or locating an alternative site just prior to or immediately after a hurricane because of likely competition for such sites.

The damage may not be so great as to warrant operations from another site. However, urgent repairs and mopping up work may need to be done at the present location. Arrangements must be put in place prior to any hurricane especially if the repair work is to be done by third parties instead of the organisation’s own staff.

For most businesses data is critical and loss of data or the inability to access data can be crippling. Having a back up of records is essential and the quality and quantity of the back ups would depend on the nature of the business. The back up records should be at a location as remote from the business site as possible, bearing in mind that the remote location may be susceptible to the same damage as the current headquarters of the business? In some cases the duplicate data may have to be stored in another country. There must also be ease of access to the data following the hurricane, and this must be tested beforehand to ensure reliability. A disaster recovery framework in respect of data should be developed so that there should be a stated timeframe in which the data recovery and accessibility is achieved.

 

Technology can be a real aid to business in times of disaster. A hurricane is likely to damage power and communication lines and mobile connectivity in the form of cell phones and laptop computers may be of immense benefit then. Other wireless means of communication may also prove to be very useful. A good disaster recovery plan must deal with all the ramifications of access to data and staying in touch with customers and other parties. If customers cannot communicate with you but can communicate with your competitors this may spell disaster rather than disaster recovery.

Key customers may be affected and the organisation may have to source other customers to replace those that may be lost temporarily or permanently. This has to be planned for in advance. Just as key customers may be affected so also may key suppliers . Supply chain disruption can lead to massive business interruption losses. Again , the plan must cater for this so that alternative suppliers can be tapped, and this must be known beforehand. It is important that the relevant aspects of the disaster recoveryplan be discussed with stakeholders such as key customers and suppliers to ensure that the plan is workable.

COMMUNICATING THE PLAN

There must be a clear communication policy. Roles and responsibilities in the disaster recovery plan must be clearly defined. If the hurricane strikes there must be a prearranged meeting place or some other means of communication between members of the disaster recovery team.

THE HUMAN RESOURCE

Staff must be told what is expected of them. Longer hours of work may be required as well as more stressful hours. Members of staff themselves may be affected by the hurricane and may need support in the form of transportation, food and shelter. Indeed key employees may be adversely affected by the hurricane and this too must be factored in. Involving all employees in the disaster recovery plan is essential to its success. A well motivated staff that is committed to the organisation’s disaster recovery plan can go a long way towards ensuring business continuity after a hurricane.

THE ROLE OF INSURANCE

Having appropriate and adequate insurance will be a definite plus in any disaster recovery plan. Your insurance broker can assist in ensuring that insurances are in place to complement the recovery effort.

Material damage insurance (such as fire and extra perils, property all risks, computer and machinery all risks) would be needed to pay for the cost of damage caused by the hurricane to buildings, stock, plant and equipment. Not having such insurances may greatly hinder the recovery effort as monies may not be available to fund repairs or replacement.

If the damage is substantial, business operations may be interrupted or reduced substantially. Business interruption insurance which covers loss of profits, wages and increased cost of working may be of great value in such a situation.

Insurance is also available to pick up the costs of replacement of data media, data and regeneration of data in the event that computers are damaged by the hurricane.