If the last year and a half has taught us anything, it is that anything can happen, and those with a plan will inevitably succeed at a higher rate than those without. However, recent studies show that 60% of small businesses do not have a formal emergency response plan, also known as a business continuity or recovery plan.
A business recovery plan, if maintained and implemented correctly, can be the difference between successfully recovering from a business interruption and going out of business.
Here are 6 steps to help get you started in creating your business continuity plan.
- Consider the types of disasters that could interrupt your normal business functions, such as storm damage or other physical property damage, utility disruptions, cyberattacks, and accidents.
- Classify the processes, functions, and operations of your business as critical, important, or marginal. Critical items are required to keep your business functioning at the bare minimum, important items are value added services or items that help distinguish you from your competition. Marginal items are generally convenience items that make doing business easier but are not required to keep your business operating.
- Identify hardware and software critical to recover business operations. This could be items such as client data, point of sale software/hardware, tools, equipment, and more.
- Ensure all critical and important data is being backed up and being stored in a protected, offsite location.
- Communicate employee responsibilities in the event of an emergency and provide training on your recovery plan/process.
- Review your insurance program with a knowledgeable insurance advisor to ensure you have adequate coverage that can respond in case of disaster.
Even if you have a business recovery plan already in place it is important to review and update your plan in response to growing cyber concerns.
Disaster planning in the past focused primarily on physical damage to a business, such as a fire or flood, but today’s businesses are facing new challenges due to the rise of corporate data breaches. 93% of businesses that experience a major data loss are out of business within 5 years. It is imperative that businesses acquire the correct coverage to respond to cybercrime events. Many property and liability policies are now excluding cyber incidents from their coverage. A cyber liability policy is needed to address cyber exposures.
For more assistance with creating a business recovery plan or to talk to a trusted insurance advisor about your insurance program please contact us.