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How To Create A Disaster Recovery Plan In 5 Steps
  • 16 June 2016
  • Eric Michaels

How To Create A Disaster Recovery Plan In 5 Steps

While there is no reason to expect the worst, all small business owners should be prepared in the event that disaster strikes. According to the U.S. Small Business Administration, most businesses fail within a year if they are unable to get back up and running in five days. To protect against both major catastrophes and minor fiascos, every entrepreneur should have a set plan. Here is how to create a disaster recovery plan in five steps:

1. Back up all data

Business owners often find themselves to be at a huge disadvantage without access to company data and documents following a disaster. With no passwords to network systems, client information, supplier data, or other business essentials at your fingertips, you will not know where to begin piecing your company back together. Keep copies of company records and licenses in a safe deposit box in case your office is destroyed or inaccessible.

For a high level of convenience and security, back up all essential data regularly to hardware that is kept at an off-site location. Meanwhile, maintain real-time storage of company data via the cloud. Entrepreneurs often think of natural disasters like hurricanes or floods, but might forget about server crashes and hacking incidents. And unfortunately, any one of these scenarios can put you out of commission for several days and jeopardize your company if you don't have a solid plan.

2. Secure appropriate insurance

While you can save important data during a disaster, you may not be able to save the expensive property you have invested in to get your business moving. Review your insurance policies to see if earthquake, flood, fireor tornado insurance is included. You may need to add an additional policy if you consider any of these natural disasters to be a significant risk. Loss of income is another important factor to consider. Without the means to operate, your company should have protection in place so you can continue servicing debt and paying suppliers on time. Otherwise, your infrastructure could crumble.

3. Have a plan in place for employees

Employees should know where to go and what to do in case of an emergency in the office. Draw up a list that starts with the safety of everyone in the workplace, and continues with escape routes and quick steps for protecting valuable equipment if there is time. Assign these duties to employees and run periodic drills or tests to see if everyone is ready to play their parts in case of an emergency. Being frozen by fear without a set list of duties can make the situation even more dangerous for your team.

4. Be ready to reboot the business

Clients who are expecting deliveries may have little sympathy for you in the event of a server failure or another minor office disaster. To protect essential revenue, your disaster recovery plan should include a guide to rebooting your business in another location. If power outages are a concern, weigh the cost of purchasing a backup generator. Otherwise, look into renting temporary office space and run the business from home before disaster strikes. Employees should be aware of this just-in-case plan as well.

5. Coordinate with your partners

Small business owners are often involved in partnerships with other companies. In the event that this exchange of goods and services cannot continue as planned, both parties should have a backup plan in place. Inform your partners what the chain of events will be should you experience a disaster of any kind. This part of your disaster recovery plan should include alternate supply options and a time line for restoring operations.

As you communicate your plan to your partners, ask if they have any emergency plans in place. Companies that expect an essential element of production—anything from a small battery to a large shipping container—from another business are vulnerable to the effects of a disaster. You may want to take out additional business insurance that protects your company in the event that a partner cannot deliver on their end of the bargain.

A lack of planning is one of the worst mistakes a solo entrepreneur can make. Luckily, with the right preparation, and these five tips, your company will be able to get back up and running in no time.

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