The saying goes that if you prepare for the worst, you’ll usually be pleasantly surprised. The flip side is that if disaster does strike, you’ll be prepared for it, says Jonathan Theders, CPIA, president of Clark-Theders Insurance Agency Inc.
“No matter what procedures you have in place, there are some things that you can’t predict,” says Theders. “For any size business, creating a customized disaster preparedness plan will keep that business afloat if a disaster occurs.”
Smart Business spoke with Theders about how to create a disaster preparedness plan that can help you rest easy at night.
Why is it important to have a disaster plan?
Think of what could occur. Fires are the No. 1 cause of workplace emergency. Delve down into what you are going to do if that emergency happens. Not only what happens during the fire, but in the aftermath.
How do you keep your business going? You can buy business interruption insurance, but if you don’t have the right plan in place, your customers are going to go somewhere else.
Regaining trust after a disaster is the hardest part. Insurance can replace costs, equipment and some lost revenue. It can keep payroll going, but there can be years of continuing issues if a proper plan is not in place.
A few years ago, there was something wrong with the lettuce at a national fast-food chain in California, but sales at Ohio stores dropped 30 percent. They never had the affected lettuce, but they suffered the negative PR impact. How long does it take to get those customers back, and will you be able to survive?
How can a business create a disaster preparedness plan?
Start with a qualified team of people. Don’t just focus on the leadership of the organization. Get a diverse group involved, from management to the front line.
Then, start by writing down anything that could potentially happen. What are the critical pieces of equipment we need to talk about? Who do we need to contact to shut utilities off if necessary? Discuss natural disasters such as tornadoes, ice storms and earthquakes.
Then, talk about man-made disturbances, including bomb threats, arson, riots and chemical release. What happens if something happens to a major roadway? What can you do? Some things apply to some businesses, some may not.
Then there is spillover. What happens if you have a dependent property? What if the disaster doesn’t affect you but affects your supplier? How are you going to react to a dependent property being affected by a major disaster? Are your suppliers on the coast, where they could be affected by a hurricane? If so, can you get your major components elsewhere? If you can’t replace it with relative ease, you yourself could be out of business and physically never have anything happen to you.
