Making smart, proactive decisions will help ensure company safety, continuity

Editor’s note: Mal Mixon, former chairman of Invacare Corporation and a well-known entrepreneur, will regularly share his business advice and experience with Smart Business readers. Ask him a question at [email protected] and your query could be the inspiration for his next column.

Q: What are your thoughts on formal contingency plans for manufacturers to handle significant problems that may arise? There seems to be more of a focus on these in recent years, and even though the costs may be high, the tangible and intangible returns for companies also may be high.

A: You can’t plan for all contingencies, but you can make some smart prevention decisions. The first one is to ensure that you have a safe, working environment to prevent injury or death involving your associates. Form a committee to deal with operations safety. There are always safety improvements to make; it’s an endless process.

You also should have a committee that deals with product safety. If a certain design creates a danger to the consumer, you are duty-bound to either recall the product and correct it or deal with it properly. Sometimes that is expensive, but you want to correct the matter.

A third area is an emerging and important one — associate safety. You may have an associate at any time who has mental or other problems, and you want to be aware of them should a situation arise. One of the proactive steps a company can take is to have a confidential counseling service available to their associates.

Also, I recommend companies have a security officer or a detail to help prevent irate associate entry — a security system that protects associates from that danger. You don’t want the crisis of having any associates murdered or injured. The security detail can also walk around the property to search for fire or theft trauma.

A fourth area is one that a lot of companies find out the hard way. Company information systems should be backed up so that if your computer system goes down and you lose a lot of data, you have a backup in a safe place so you can restore what has been lost.

All contingency planning, except information systems, has to do with human safety. Whether it is operations safety, product safety or security, all those issues are involved in the safety of the product user, the safety of the worker in the environment and the safety of the associate from the security point of view.

Q: What precautions should be taken when an associate goes to a foreign country?

A: Another concern is if you have an executive who goes overseas and may be taken hostage for a ransom. One of the easiest things you can check is the Department of State safety ranking for travel in that country and what things to look for, whether you should have a bodyguard, how and where to travel and what areas to avoid.

A second precaution is to consider purchasing hostage insurance. This usually includes coverage for money paid to extortionists or kidnappers, loss of ransom money in transit and other expenses involved in a kidnapping.