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How To Create A Business Disaster Plan

June 15, 2022

Cecilia De La Rosa

Cecilia De La Rosa

Is your construction business prepared to continue operating in the face of a natural disaster or power outage? For many companies, loss of electricity and an internet connection could be catastrophic. A business disaster plan prepares your company and its employees for potential disasters and gives them a clear picture of how to respond to get the business back up and running as soon as possible. Since construction is a critical industry during a disaster, it is especially important that companies in this industry are ready to respond.

A business disaster recovery plan contains instructions on how the business and its employees will respond to potential disasters or disruptive events, such as natural disasters and power outages. It’s a formal document that helps the company minimize the negative effects of disasters so they can restore operations as quickly as possible.

Business impact analysis

You can’t begin to plan your response to a disaster until you know the potential effect it will have on your business. Some effects are obvious, while others may take a while to manifest. Potential damages include:

  • Lost or delayed income
  • Reduced cash flow
  • Increasing expenses
  • Fines and fees
  • Contractual penalties
  • Customer dissatisfaction
  • Delayed business plans

Companies should begin their disaster planning by completing a business impact analysis. This analysis helps to identify the critical processes and resources that will be needed in case of a disaster. Depending on the type of disaster and its duration, businesses can be affected differently. By identifying the critical processes and resources, you can begin to plan how to respond. A business impact report is created based on several disaster scenarios, such as:

  • Physical damage to a building or buildings
  • Damage to or breakdown of machinery, systems, or equipment
  • Restricted access to a site or building
  • Interruption of the supply chain including failure of a supplier or disruption of transportation of goods from the supplier.
  • Utility outage (e.g., electrical power outage)
  • Damage to, loss or corruption of information technology including voice and data communications, servers, computers, operating systems, applications, and data
  • Absenteeism of essential employees

Disaster planning steps

1. Establish a planning team

Your planning team should include employees at all levels and worksites as well as management decision-makers. Be sure to include outside consultants, like IT or HR.

2. Establish an execution team

Make sure that all actionable items are assigned to a team member, so there’s no confusion about who does what. Assign a leader responsible for executing and managing the disaster plan.

3. Develop goals and objectives

Before beginning your plan, identify the goals and objectives that you want to accomplish. Clearly defined goals will ensure that your plan is effective.

4. Determine your current capabilities and potential hazards

List out your business’s primary activities and how they are currently being done. For each activity, consider what hazards or emergencies could affect your ability to perform. Be sure to consider the worst-case scenarios.

5. Write an action plan for each potential hazard

For each potential hazard or disaster, create an action plan. The action plan lists the procedures to be followed in the short term to get your business up and running. Each step of the plan should be assigned to an employee or position. It’s also important to have a long-term recovery plan in place.

Many companies rely on digital processes to complete their daily work. It is important to develop manual workarounds to allow work to continue when these digital processes are not available. Creating data collection forms ahead of time will speed up your response to a potential disaster. Make sure that you have enough staff available to handle the additional work created by manual processing.

You should have at least one emergency kit available for your employees. If you are working on job sites, each site should have its own emergency kit. The kit should include, at a minimum, first-aid supplies, a flashlight, batteries, battery-powered radio, nonperishable food, bottled water, and a blanket.

6. Train your employees

Provide all employees with a copy of the disaster plan and begin training them on the plan steps. Go over the plan and ensure that everyone understands their role. Make sure that newly hired employees are trained as part of the onboarding process.

7. Test and evaluate the plan

The plan should be tested at least yearly by implementing a live drill. Have employees go through the motions of the plan and evaluate its effectiveness along the way. The plan can be revised and reevaluated at any time.

Having a business disaster plan is key for ensuring the success of your company during a disaster or emergency. Like other policies, it should be a living document, constantly being tested and updated. For more information about disaster planning, see the Ready.gov site.

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