Save Your Small Business from Disaster with a Continuity Plan

Save Your Small Business from Disaster with a Continuity Plan

By Brittany Hilbert, financial advisor, Pinnacle Financial Partners

Learn about pandemic lending programs from the Small Business Administration and how they can help your company during the crisis.

Being prepared for interruptions of your day-to-day operations is important for businesses of all sizes. So many scenarios can affect your business: flooding in Upstate South Carolina, a tornado in Tennessee and the global impact of COVID-19—you never know what will strike or when.

Having a plan for these disruptions can be the difference in weathering the storm or closing down shop.

Business Impact Analysis
The first step is to identify potential threats to normal operations by conducting a business impact analysis. Get input from key employees to make sure you cover all bases and don’t miss any of the details you might not be familiar with as the business owner.

Items to consider:

  • Who are your “essential employees”?
  • What devices, equipment and systems are necessary for operation?
  • What might happen in your area that would prevent any of these from serving their function?
    • Natural disaster: Inability to travel, damage to physical location or equipment, inability for customers to get to you
    • Emergency situations: Fire, medical emergency, active shooter, etc.
    • Utility outages: Loss of power, water, Internet/phone, electricity, gas leaks
    • Illness: Has an impact on employees, clients and suppliers
    • Death or disability
    • Supply chain interruption
    • Third party services

Mitigation and Recovery Strategies
Keeping employees and customers safe obviously should be your No. 1 priority. However, you have many other factors to consider and prepare for.

For each potential disruption, develop a plan to keep your business operational with minimal interruption.

  • Do your essential employees have the ability to work remotely?
    • Can they access critical systems, emails, employee and client contact information from home?
    • If you don’t already have them, find a virtual meeting or conference call service in the event of a quarantine or inability to come to a physical location.
  • How will you contact and check in on your employees?
    • Phone trees, meeting locations and prepared email lists are all good options.
  • Are your employees cross-trained to support several areas of the business in the event of reduced staffing?
  • Do you have alternative suppliers, manufacturers and/or distributors that you could change to if your primary is disrupted?
  • Do you need to have backups like generators to keep the business going, or access to equipment you could rent in the event of damage?
  • How are you storing information? Do you have an offsite backup? How is it accessed--online, or will you need to travel to a physical location?
  • Are you adequately insured in the event of a loss, if you lose your top sales producer, if you or a key employee dies or experiences a disability? Do you have a succession plan laid out with who would take certain responsibilities if you are unable to come in for an extended period of time? What would the chain of command be?
    • Protecting institutional knowledge is a must.
  • Do you have capital or access to capital to get you through disruption of normal sales revenue?
    • That includes cash on hand, lines of credit, etc.

Distribute and Test your Plan
Make sure all employees are trained on the location of the plan and any actionable items. Test backup systems on frequent intervals to make sure they’re ready if you need them. The plan should be treated like a living document. Make revisions and updates as necessary and as personnel or situational changes arise.

After a Disruption Event
True recovery after a disruption event will depend on the type and severity. It may be hours to days or weeks to months.

Put your Plan into Action
You will need to assess any losses, file claims for any items covered by insurance and check into any government assistance programs like SBA.gov/Disaster. Work on a timeline to resume normal operations and assign tasks as needed.

Business disruption events are never pleasant, but having a plan can help give you peace of mind. The goal is to minimize reduction of revenue by restoring operations as quickly as possible. Disaster or no, every small business needs a team of experts: a banker, an accountant, an insurance agent and an attorney. These people will be good resources to help you plan and make sure that you are protected and funded through any business disruption event.

 

Brittany Hilbert is a financial advisor for Pinnacle Financial Partners. She is based at the firm’s office on Pelham Road in Greenville, NC, and can be reached by phone at 864-315-1043 or by email at Brittany.Hilbert@pnfp.com.

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