Is Your Business Disaster-Ready?

Here are 10 tips to
better protect your business and, if damage occurs, what you can do
to speed your recovery.

First, here are tips to
help you protect your business:

1. Identify what you
need to protect. Many businesses spend far too much time piling
up the sandbags without considering what really needs the most
protection. Your first step in adequately preparing your business
for a disaster is to identify what matters most and take steps to
address that. “If you run a food service business, if you lose
electricity for 24 hours, you can lose $50,000 to food spoilage,”
says Donna Childs, co-author of “Contingency Planning and Disaster
Recovery: A Small Business Guide.” “Look into backup power supplies
and make sure any possible damage is covered in your insurance
policy.”

2. Develop a
specific disaster plan. Next, map out precisely who will do what
if some sort of disaster occurs. Who will be in charge of evacuation
or of making certain that important documents and data are safely
secured? Designate a meeting spot outside of your business. Share
the plan with your employees and keep it up to date. “The last thing
you want is trying to figure out what to do while a disaster is
unfolding,” says Childs.

3. Get your
insurance in order. This means more than just knowing where your
policy happens to be. Specific issues include:

• Check your policy
  endorsements. Vanilla insurance may not cover specific areas
  that matter to your business. Add them on as need be.
• Consider business
  interruption insurance. Akin to disability coverage, this
  insurance is designed to compensate you for lost income after a
  disaster. (The compensation amount is based on how much revenue
  you would have earned in a given time period.)
• Set up direct
  deposit. Do this so you don’t have to wait for the check in the
  mail which may or may not come. Instead, your insurance
  company will be able to deposit any benefits directly into your
  bank account.
• Assign a point
  person for insurance issues. This person should keep all of the
  pertinent information and contact data at the ready.

4. Consider cash.
Even solid insurance coverage will have deductibles. If you can,
earmark some cash to pay those and other expenses. (I’ve talked to a
few small business owners who have, literally, $5,000 in a safe
that’s kept on the premises.) If that’s not in the cards, open up a
line of credit with your bank for a ready money source. To be extra
safe, Brian Drum, chief executive office of Drum Associates, a
survivor of the 9/11 tragedy and business preparedness advocate,
recommends tapping into the line of credit. “If you wait for the
disaster to occur, you might not be able to access it.”

5. Buddy up. The
most amenable landlord on earth can do little about office space
that’s been reduced to ruins. Address that potentially-crippling
problem by “buddying up” with another business a non-competitor
who’s willing to offer a conference room or any available space to
help you out. By the same token, if they’re the ones taking the hit,
make your space available to them.

Finally, here are tips
to help you get back on your feet as quickly as possible:

1. Assess the damage
realistically. This may seem rather obvious, but many businesses
make the mistake of sugar coating whatever damage may have occurred
not only in terms of financial cost but in how quickly things
might be able to return to normal. Don’t make the same mistake. As
soon as you can, look things over and take a hard view at how long
it will take for your operation to regain its bearings.

That’s precisely what
Adam Vodanovich was faced with in the aftermath of Hurricane Katrina
in the late summer of 2005. The operator of a number of Wing Zone
take-out and delivery restaurants in New Orleans, Vodanovich quickly
realized that some of his outlets were far better positioned to
recover than others: “We prioritized the stores we could start with
based on the neighborhoods we could get to. You have to assess the
situation with a realistic eye.”

2. Move as quickly
as possible. Physical damage is one thing. The emotional trauma
of disaster is often just as crippling. The longer it takes a
business to recover, the more quickly damage can fester. So, move as
quickly as possible to begin clean up efforts. “The faster you move
to rebuild, the easier the job is,” says Renee Miller of The Miller
Group, a Los Angeles ad agency which endured the devastating
Northridge earthquake in 1994.

3. Get involved.
Nothing may be more alienating to employees than a leader who
directs disaster recovery from afar. If there’s physical cleanup to
be done, don’t be hesitant about getting your hands dirty. That can
prove a powerful morale booster, no matter how unpleasant the task
may be.

4. Stay in touch.
One of the most problematic elements of picking up the post-disaster
pieces is keeping lines of communication open. Bend your efforts to
that end, and be certain you cover as many bases as possible:

• If you’ve had to
  relocate temporarily, make sure the post office knows where to
  send mail. The same goes for FedEx and any other overnight
  delivery service.
• Contact suppliers
  and vendors to try to keep goods and services flowing as
  smoothly as possible.
• Get together with
  your bank at your first opportunity to arrange any sort of
  emergency funding.
• Print up flyers
  and distribute them throughout the neighborhood to let people
  know you’re back in business (or plan to be so shortly.)
• Send out a mass
  e-mail to let people know you’re back in business (or plan to be
  so shortly). Here, products such as Microsoft Office Outlook
  with Business Contact Manager can help. (Editor’s note: Business
  contact manager is part of Microsoft Office 2003 Small Business
  Edition.) and Microsoft Office Professional Edition 2003.) You
  can gather significant points of information about customers,
  including sales statistics, shopping preferences, contact
  information and other data. That can make any comprehensive
  e-mail effort easier to manage and more effective in
  communicating with customers in the most effective manner
  possible.

5. Help others.
Getting your business back on its feet shouldn’t be an every man for
himself proposition. Helping others rebuild isn’t only the right
thing to do, it can be good for your business in the long run.

If you provide another
business with good and services, tell them to pay you whatever they
can afford. If your business is pretty much cleaned up, man a broom
at a neighbor’s operation. Says Vodanovich, referring to the
devastating Hurricane Katrina of 2005: “Everyone down here in New
Orleans is banding together, especially small businesses. We’re used
to overcoming adversity and adapting.”