Three Basic Steps in Disaster Planning

Think about disaster planning as a nomadic tribe might. How do you pack only the essentials and relocate with little or no notice? How do you reestablish your business with next day efficiency?

The modern business world consists of three essential elements: virtual assets, current hard assets, and supply chain/delivery assets.

The virtual world of documents, financial accounts, and data drive the profit and loss, the income statement.

Everyone has been told to back up these data and keep a copy off premises. Try this approach:

1. Decide which data are truly mission critical: supply chain status, current orders, financial statements, bank accounts, payables, receivables, employee data, and customer data.

2. Copy these data updated monthly. One copy goes into the safety deposit box at the bank. One to a trusted officer.

3. Copy daily transactions for the month to the officer's memory stick. Update two sets at month's end.

These data will allow you to reroute supplies to temporary quarters, warn expected deliveries of delays, and keep up with daily transactions.

Assess current hard assets. Do you need brick and mortar location(s)? Keep a list of alternative available locations in that bank box. 

Do you need large machinery difficult or expensive to move and set up? If so, temporary changes in locations may be out of the question. But, an agreement to share capacity with a friendly competitor might solve the problem either one of you might face. 

Perhaps you're in a position that replacing hard assets would not be prudent. Re-engineering your process and modernizing makes sense. In this case, insure accordingly for business interruption; but be prepared to fund some of the downtime through corporate savings.

Hard asset loss needs to be prevented, contingency planned, or insured to protect company assets and reputation. Look at your key production assets and have a game plan in place.

Supply chain and deliveries data is critical in disaster planning to keep the process moving. You do not want your customers moving on to their plan B while you're recovering.

Can you store inventory in a second location? Perhaps you have customers in other states. Is permanent storage available to make a remote supply economical?

Delay supply acceptance if needed, but try not to miss deliveries. That disaster agreement with the friendly competitor might come in handy here.

Consider the mission critical aspects of your business. Think of the financial data, the hard assets, and the flow of goods when contingency planning. 

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Further Reading
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