Every Houston business disaster recovery plan needs a review. If you don’t have one, you need one. Preparedness is your businesses’ survival kit. It mitigates the risk companies can face during and after extreme disasters – be it fire, cyberattack, infrastructure failure, or weather-related.
Infrastructure systems such as electricity, gas, water, transportation, telecommunications, and digital technology are the backbone of modern businesses and the economy. Most companies depend on these infrastructures to run their operations smoothly, as these systems are mostly inter-dependent. But it also means their disruption can burn a big hole in any organization’s pocket. It seems to be becoming an unsettling norm.
Apart from these, businesses, supply chains, and employees face many severe disasters with cascading effects. Some of them include:
- Human-inflicted hazards like accidents, sabotage, acts of violence, etc.
- Natural calamities like earthquakes, floods, snowstorm, hurricanes, and tornadoes
- Health hazards like life-threatening illness, contamination, or widespread flu-like the present COVID-19 pandemic
These hazards lead to revenue deficit, reduced profit, and workforce, pushing the company into significant financial ruin. While the insurance covers a specific part of the overall loss, it cannot give you back the recovery path and strong customer base.
Top 10 Costliest Disasters in the U.S. Since 1980
|1.||Hurricane Katrina||2005||$168 billion|
|2.||Hurricane Harvey||2017||$130 billion|
|3.||Hurricane Maria||2017||$93.6 billion|
|4.||Hurricane Sandy||2012||$73.5 billion|
|5.||Hurricane Irma||2017||$52 billion|
|6.||Hurricane Andrew||1992||$50.2 billion|
|7.||U.S. Drought/Heatwave||1988||$44.4 billion|
|8.||Midwest Flooding||1993||$37.7 billion|
|9.||Hurricane Ike||2008||$36.6 billion|
|10.||U.S. Drought/Heatwave||2012||$33.9 billion|
The coronavirus outbreak is proving to be costlier than any of the natural disasters the U.S. has faced, not to mention the economic impact around the world in the wake of the global pandemic. (Kurt, 2020)
Disaster Recovery vs. Business Continuity Plans
It’s hard to imagine an extreme situation when you are busy establishing your business. The daily operations take all your time – managing employees, accounts, customers, and an endless list of other duties. Disaster recovery and business continuity plans take a backseat with the mindset that ‘we will deal with it later when a disaster hits’ or ‘we know we will never need it.’
Statistically, 40% of businesses do not reopen following a disaster. Apart from that, another 25% fail within one year according to a report from the Federal Emergency Management Agency (FEMA).
The United States Small Business Administration also confirms that over 90% of companies fail within two years of being struck by a disaster. (Access, 2020)
Whether the risk of business disruption is physical, virtual, financial, or reputational – your relentless attitude to staying competitive even in the adverse situation is what will make all the difference. And that comes with robust planning.
Business Continuity vs. Disaster Recovery?
A disaster recovery plan (DRP) is an essential component of the overall business continuity plan. The plan outlines policies and procedures in case of failure or disruption in the IT systems. Natural disaster, a massive human error such as an attack, sabotage, etc. or technology failure are situations when the plan is rolled out.
A business continuity plan or BCP, on the other hand, is a plan devised to macro-manage the overall functions of the business necessary to propel the organization forward in disaster. A regular review includes checking preventive control along with managing customers and employees too.
Critical Steps to Planning DRP and BCP
Following are 7 Steps for preparing a Disaster Recovery Plan for your business:
- Take inventory of all data, apps, etc. – The first step should be to make a laundry list of all the hardware and software used in the company. It should be in the order of priority to run the core operations during the crisis.
- Define downtime and data loss limit – Identify a tolerant recovery point objective (RPO) and recovery time objective (RTO) to prioritize what’s most critical to survive a disaster and lower the risk of miscalculations for business recovery.
- Assign and define roles – Put down the contact information for all senior personnel in the company. The chart categorizes which senior executive or department needs to be contacted for a specific situation. It will save them from last-minute panic and hassle in the company.
- Create a communication plan – It’s a step-by-step chart on how to communicate with each senior executive during an emergency, who will be the 2nd point of contact, and the communication mode.
- Work strategy and location – The plan also incorporates an alternate method to accessing the work network for employees, either from their respective homes or different location.
- Service-level agreements inclusive of service during a disaster/emergency –For the companies who have outsourced their technology, ensure that you have a contract that defines the extent of service in case of disaster.
Here are 6 Key Steps to be outlined in a Business Continuity Plan
- Strategy – The essential step in a BC plan is to have a smart system in place for running day-to-day operations during a crisis.
- Organization – The organization’s face for internal and external communication during a crisis, the emergency response, skills, and responsibility of each employee listed out.
- Applications and Data: A backup plan for accessing all the software that enables business operations.
- Processes: Clearly define critical business processes in the order of priority to run the business and the IT requirement.
- Technology: A reservoir of all the systems, backup, network, and industry-specific technology required for smooth operations.
- Facilities: A detailed list of to-do and pre-decided secondary/recovery sites to continue running the business if the primary one gets destroyed in the disaster.
Local Houston Resources:
Businesses in the Houston Area can find information on the City of Houston website. You can download a list of resources here.
Test, test and test until you know you business disaster recovery plans are water-tight. It also helps you to understand the loopholes and vulnerabilities in your goals. Improvise real-time, train your employees and be prepared to face all odds. Except for this time, you have an exit plan for your business to survive and thrive.
At Haltner Design + Build, we care about our business clients. Building a sound, safe structure that withstands the elements matters, and helping you be prepared for any emergency matters as well. If your business has experienced storm damage and needs repair, new furniture or fixtures, we can be that trusted resource for you.
We have served Houston for over 30 years and are uniquely an integrated design-build firm. All services from design, build and furnish to cutting the grand-opening red ribbon are all here for you whether you have a new construction project or a renovation.
Kurt, D. (2020, September 30). The financial effects of a natural disaster. Retrieved February 22, 2021, from https://www.investopedia.com/financial-edge/0311/the-financial-effects-of-a-natural-disaster.aspx
Access, P. (2020, April 14). Study: 40 percent of businesses fail to reopen after a disaster. Retrieved February 22, 2021, from https://www.accesscorp.com/press-coverage/study-40-percent-businesses-fail-reopen-disaster/