For Small Businesses, COVID-19 is a Costly Wakeup Call

 COVID-19 Remind SBOs of the Importance of Disaster Recovery Plans

The COVID-19 pandemic has been brutal in all regards. But it’s been an especially powerful reminder that even when we think we’re in control, there are outside forces that threaten to tear us apart. A good disaster plan can help mitigate damage in situations like these.

What is a Disaster Recovery Plan?

A disaster recovery plan is a carefully documented and structured approach that articulates precisely how an organization can and will respond after an unplanned incident. It’s one element in a business continuity plan and is especially important in unprecedented situations like the one we’re currently experiencing.

“The step-by-step plan consists of the precautions to minimize the effects of a disaster so the organization can continue to operate or quickly resume mission-critical functions,” IT expert Margaret Rouse writes for TechTarget.

A disaster recovery plan is only as effective as it is thorough. Some types of disasters organizations should plan for include application failure, data center disasters, building disasters, natural disasters, city- and state-wide disasters, national disasters, global crises, etc. And even though every disaster is unique – especially today’s COVID-19 crisis – a disaster recovery plan lays the groundwork for being able to respond appropriately in spite of distinct challenges.

How to Create Your Own Disaster Recovery Plan

A disaster recovery plan is only effective if you have one. And it needs to be properly structured so that you can stay protected, weather the storm, and recover with greater efficiency. Here are some things to include in your plan:

  1. Emergency Response Plan

A disaster is, by its very definition, unforeseen and shocking. If you wait until you’re in the middle of a disaster to make a plan, your judgment will be clouded.

A good disaster recovery plan has a carefully crafted emergency response plan built into it. The plan should explain what you do first, second, third, etc. Each individual within the organization should have a clear understanding of their priorities, as well as action steps they can take once their responsibilities are taken care of.

  1. Hardware and Software Inventory

Every disaster plan needs to include a comprehensive inventory of all hardware, software applications, and subscription services. They should ideally be ranked in order of priority. (In other words, which ones need attention first in the midst of a crisis.)

As part of your inventory, keep technical support contact information on hand so that you can quickly contact the right parties and implement the appropriate solutions.

  1. Contingency-Plans for Employee Benefits

It’s easy to get so caught up in maintaining IT infrastructure, buildings, and other physical resources that you forget about the most important resource your business has: people.

As part of your disaster recovery plan, have contingencies in place for employee benefits.  This includes employer-sponsored 401(k) plans.

For example, this current COVID-19 crisis has led the federal government to temporarily remove penalties for funds held in retirement accounts like 401(k)s. However, it’s up to each business and its 401(k) fiduciary to decide whether or not they’ll allow savers to take out penalty-free money prior to 59 ½. For businesses that already had clear contingency plans in place, making this decision required minimal forethought. The plan made the decision for them.

  1. Proper Insurance and Protections

For the most part, insurance is seen as something you buy under the hope/assumption that you’ll never need it. In the middle of a crisis, it becomes overwhelmingly evident why insurance is necessary. Carefully review your insurance coverage and consider these policies in your disaster recovery plan. They can soften the blow considerably.

  1. Data and Records Backups

In this day and age of digital records, it’s imperative that organizations consider how their sensitive files and information are being recorded and backed up. As you create and modify your disaster recovery plan, think about the tactics you can use to mitigate damages in a physical crisis or cyber attack.

View This as an Opportunity

Million- and billion-dollar businesses will be forged in this fire. Out of every great economic collapse, there are always a few people and organizations who rise above the circumstances and leverage the opportunities they’re given to step apart. A disaster recovery plan can play a key part in this process.

Are you prepared? And, perhaps more importantly, will you be prepared for the next big disaster?

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