Ready for Anything

Business survival lies in your pre-disaster efforts.

• By Stephanie Williams
• Apr 01, 2010

On the morning of Feb. 7, 2008, employees of a Georgia-based sugar refinery probably began their day like any other. The manufacturing plant was producing granulated sugar, and business was on as usual. However, the day at this refinery changed when explosions shook the plant after accumulated sugar dust ignited from an overheated bearing. Within minutes, employees were faced with a disaster that claimed the lives of 14 co-workers, injured 36 others, and destroyed several buildings in the process.

Are you prepared for the worst situation your company may face?

Being prepared for an unexpected disaster requires planning well in advance in order to manage any emergency situation. Whether it is a natural, weather-related, man-made, or technological disaster, the key to survival lies in your pre-disaster efforts. Taking the time to assess the company's functions, develop plans to keep the business operating, detail strategies to lead recovery, and conduct employee training can make the difference between survival or closure for a business.

Assessment

First, it is important to understand what kinds of emergencies might affect the company, both internally and externally. Researching the types of natural disasters that are most common in the area where the company operates and analyzing processes that could put the company and employees at risk will direct you toward the safety and precautionary measures that need to be taken in a disaster.

Next, carefully examine various functions of the company to determine which employees, materials, procedures, and equipment are absolutely necessary to keep the business operating in an emergency.

When conducting an assessment:

• Review your business process flow chart.
• Identify operations critical to survival and recovery.
• Find out how and where documentation is stored, such as backup copies of tax, accounting, payroll, production, and customer records.
• Review existing plans if arrangements are made to operate the business in a temporary location or if the company is ready for a utility disruption.
• Review the company's insurance coverage to understand what is and is not covered.
• Establish procedures for succession of management. Include at least one person who is not at the company headquarters, if applicable. Finally, identify your suppliers, shippers, resources, and other businesses the company utilizes on a daily basis. During the assessment, you should:
• Determine whether or not qualified backup sources have been established to meet your company's needs. A disaster that shuts down a key supplier can be devastating to your business.
• Review the contact list for existing critical business contractors and others you plan to use in an emergency. Identify where this list and other important documents are located.
• Find out whether a list of the most important customers has been developed to enable the company to continue service during and after a disaster.

Planning

A company's employees are its most important and valuable assets, followed quickly by the physical property and business operations. Taking steps to protect these assets is critical to a successful recovery. There are three plans that should be developed to protect employees and the business in the event of disaster — emergency action plan, crisis communication plan, and business continuity plan.

Emergency Action Plan

Emergency action plans are developed to provide guidelines on actions employees must take when an emergency occurs. According to OSHA, the minimal elements that must be in an emergency action plan include:

• Evacuation procedures and exit route assignments
• Procedures to be followed by employees who remain to operate critical plant operations before they evacuate
• A procedure to account for employees after emergency evacuation has been completed
• Rescue and medical duties for those employees who are to perform them
• Procedures for reporting fires, hazardous chemical spills, and other emergencies
• Names or regular job titles of persons or departments who can be contacted for further information or explanation of duties under the plan

Crisis Communication Plan

Regular communication with employees before, during, and after an incident is critical. A proactive approach would include details regarding how your organization will communicate with employees, local authorities, customers, the public, and others during and after an emergency.

Employees: Be prepared to provide employees with information on when, if, and how to report to work following an emergency.

• Set up procedures to communicate with employees in an emergency, such as a call tree, password-protected page on the company Web site, an e-mail alert, or a call-in voice recording.
• Be clear on how their jobs may be affected.

Management: Provide top company executives with all relevant information needed for the protection of employees, customers, vendors, and nearby facilities on a regular basis.

Public: It may be important to update the general public with calm assurance that all resources are being used to protect workers and the community. Communicating a recovery plan may be especially important.

Customers: Update your customers on whether and when products will be received and services will be provided.

Government: Tell officials what the company is prepared to do to help in the recovery effort and communicate with local, state, and federal authorities what emergency assistance is needed to continue essential business activity.

Other businesses/immediate neighbors: Be prepared to give competing and neighboring companies a prompt briefing on the nature of the emergency so they may be able to assess their own threat levels.

Business Continuity Plan

As with any good business plan, a continuity plan should provide a blueprint for how a company will protect its employees and its critical business functions during and after a disaster. Developing a strategy that will minimize downtime and get business operations up and running as quickly as possible can be the deciding factor in the survival of an organization.

When writing a business continuity plan, address the following:

Employee needs. Think about how the company can meet the immediate needs of employees so that they can return to work as soon as possible. This includes basics, such as how payroll will be handled. Also, think of a way to operate efficiently with a smaller staff of key individuals.

Goods and services. Think about suppliers and where they are located, as well as the procedures they have in place to handle emergencies. Develop professional relationships with more than one company in case a primary contractor cannot fulfill supply needs.

Phone numbers. Think about how you will contact suppliers, employees, customers, utility companies, business partners, and emergency agencies, not to mention the company's insurance company and the local media. Make a list of current phone numbers and keep it, along with other important documents, on file in an emergency supply kit and at an off-site location.

Business functions. Think about where the company could relocate, if necessary. Determine where backup copies of records could be stored. The Small Business Administration recommends that an off-site location be at least 100 miles away. Important documents should be saved in fireproof safe deposit boxes. Other functions to think about include how the company will handle payroll, accounts payable and receivables, regulatory compliance, and insurance claims.

Equipment and supplies. Think about the equipment, vehicles, and office supplies that are necessary for business operations. Consider whether or not these items can be leased or rented while the damaged equipment is being replaced or repaired.

Recovery

In the wake of a disaster, a company should be prepared to lead its recovery efforts. This involves stabilizing operations after the immediate impacts of the event and implementing a coordinated and sequenced process of recovery activities. However, recovery programs and operations should be adaptable to meet unmet and evolving recovery needs.

Training is a key element in the success of a company's disaster recovery and business continuity efforts. Providing employees with complete information on the plans that are in place to protect them and the business in an emergency will provide comfort and an understanding of the role they play in an emergency situation. It is a good idea to meet with employees at least once a year to review emergency plans and to share information on disaster preparedness. It is also a good idea to go beyond planning and frequently practice what you intend to do during a disaster. Drills and exercises will help the company be prepared.

Bottom Line

There is no guarantee a disaster will not strike your company, so taking the necessary steps to prepare for the worst situation your company may face is a wise investment.

This article originally appeared in the April 2010 issue of Occupational Health & Safety.