Two weeks ago, I began this new "Friction Fridays" series by asking if your were prepared for an emergency or a disaster. Then, I went ahead and rubbed you raw over the fact that I was absolutely 199 percent certain that you were not.
I tried to make it really tough on you – to get you thinking about what would happen if something like a 5.8 magnitude earthquake had its epicenter under your place of business.
By the way, did you see that we had a 5.8 earthquake right here in Oklahoma last Saturday morning? Now, my good friend, Charlie Russell, who I affectionately refer to as "the other guy," is ribbing me about not only having to deal with an F5 tornado every now and then, but also earthquakes.
Last week, I tried to reduce the friction by giving you some helpful tips and ideas when it comes to configuring a Disaster Recovery and Business Continuity Plan. We looked at some very specific areas that must be included in every DRP and BCP by looking at several aspects of a Recovery location. In other words, how you would continue your business at your existing site with recovery support services, or at an alternate location in the event that your original location simply is uninhabitable?
In looking at relocation, we examined some personnel related issues, like how a new location or altered traffic flow could impact people in terms of employees, customers and vendors. We also illustrated some key points for maintaining the logistical and organization balance of your personnel within a new facility and how an option for remote-worker connectivity might impact your day to day operations.
Next, we talked about technological consideration.
Today, I want to focus on a more human side of the equation. Are you ready to deal with the change and impact that the loss of even a single employee can have on your business as a result of a disaster?
I know I'm about to run some of you raw, because some of you will think that old Murph has a cold heart as I talk about these next few subjects.
Disaster Recovery Plan – Topic 2: Recovery Manpower
Let's look at a couple of scenarios in order to discuss recovery manpower planning as part of a DRP or BCP:
Scenario No. 1 – Disaster of One
You operate a relatively small wholesale/retail business, which for the most part, is a warehouse operation. You have a small storefront where you sell a few safety supplies (hard hats, first aid kits, gloves, safety cones, etc.) to walk-up customers.
But that kind of retail business isn’t your bread-and-butter. Instead, the majority of your revenues come from the four internal salespeople. You also have two outside salespeople who travel around the state to visit current and potential customers, performing safety inspections as a free service in which they hope to identify products you sell that the customer needs (like an emergency eye wash station). You also have part-time high school student who comes in every afternoon to work the front counter.
Along with that team, there are four warehouse workers who receive merchandise, and pick and pack shipments to fulfill customer orders. There's a part-time driver who makes local deliveries within a 25-mile area three mornings a week.
That leaves you to run the company, and your trusted bookkeeper, who also covers the front counter each morning. She has been with you since Day 1 – 30 years ago.
Life was grand – until five days ago.
Last Friday, around noon, it started to rain. It simply wouldn't stop. It rained all night Friday, all day Saturday, and right on through the weekend. It didn't stop until around 1 a.m. Monday morning.
After surveying the damage, many areas of town were flooded. Most of the roadways in the rural areas were flooded. With the sun shining brightly on Monday at daybreak, everyone made it into work, with the exception of your trusted bookkeeper.
When you called her husband, he said she had left at 7:30 a.m., her normal time, and headed into town on Rural Route MC7018. A few hours later, a deputy sheriff found the bookkeeper’s car in a ditch near a swollen creek. When the water flooded out her car, she started to walk back, where she got caught in run-off and drown in the swollen creek.
Her body has not been discovered.
Illustration adapted from the "Turn Around, Don't Drown!" campaign of the National Highway Traffic Safety Administration.
It's a tragedy that goes beyond words for her family, friends and co-workers. And while it might be ruled an unnatural death – or, as the coroner said, "a pulmonary arrest, secondary to accidental drowning" – the fact is that this is a disaster for your business.
You don’t know anything about bookkeeping. You just sign the checks when their put in front of you. The high-school girl has never touched QuickBooks. She just punches the buttons on the cash register.
What do you mean that your state sales tax return is due tomorrow and that last month’s payroll taxes are due as well? You haven't got a clue how to handle these requirements.
This is a small town in the middle of Nowhere, USA. It’s not like you have a QuickBooks specialist on every corner. In fact, you don't know the password to her computer, so how are you going to get into QuickBooks?
No, you're not ignorant when it comes to this part of your business. You focused on what you focused on. Your bookkeeper did the rest. She was as much a part of running your business correctly as you were. She was one of your trusted teammates – and now she's gone.
Believe it or not, a "disaster of one" like this can quickly compromise the continuity of a small business. Where are the passwords kept? Are they up to date? Where is the data backed up? When was it backed up last?
Can you answer these questions? Have I rubbed you raw yet?
What contingency plans do you have in place to avoid a "disaster of one?" This could happen to anyone, anywhere, anytime. What about if you lost one of your salespeople? Even worse, this ‘disaster of one’ could just as likely been YOU!
Who would take over? After the goodbyes, who runs the business? How would your employees get paid? Who will sign the checks? Are there any checks? Is there even a valid signature on the bank signature card?
Another important question: How would your family survive without the income you earn from your business? Sure, you left them with good life insurance policy. Does anybody know where that information is?
This is all food for thought. So, am I rubbing you raw yet?
Business Continuity Planning is about the continuity of your business in any situation, in any occurrence – emergency, disaster, etc. If you're not ready now, you need to get ready. The next ‘disaster of one’ could be just a thunderstorm away.
Scenario No. 2 – Disaster of More
Since I think you can see where I am going, I don't need any more gory details, unless you think I have a proclivity for the macabre. But I am going to up the disaster scenario a little bit more.
Let's use the same basic equation as in Scenario No. 1, but the flood never occurred and our beloved bookkeeper still is with us. But your firm did recently acquire a whole new line of safety equipment from a major manufacturer, which is perfect, because you have just been selected to be their distributor in six states.
As part of the plan, you need to hire at least three additional internal salespeople – promoting two of the existing ones to outside routes. But there's just one thing, the new manufacturer needs you to send the entire sales crew to Chicago for a three-day training program on the new products.
You decide that you and the newest sales guy can handle the calls, so you turn over the keys to your new Chevrolet Tahoe to your head salesman. Bright and early on a Monday morning, the crew heads for Chicago with instructions that the two outside guys who already have company credit cards will pickup all the expenses.
Around 2 p.m. you receive a call from the State Highway Patrol. Your car has been involved in an accident at a railroad crossing. It appears that the driver attempted to skirt around the warning gate and the car was struck broadside. It burst into flames. All five of your employees died in the accident.
Car attempting to 'beat the train', he didn't win! (As seen from a camera mounted inside the train's cab.)
Car at train crossing
Let’s not only hope that you have a really good auto insurance and workers’ compensation policy, but that you also have a Disaster Recovery Plan and Business Continuity Plan that can handle this type of disaster of five. If you don't, your business may be hanging in the balance.
I know, you may say, “Murph, both of these are pretty farfetched scenarios. Things like this simply do not happen to a small business.”
Well, you're wrong. Things like this happen more than you think. In fact, it's more likely to happen than an F5 tornado blowing your business all over Oklahoma, a totally unexpected 5.8 magnitude earthquake rocking every structure in your city, or a 1,000-year flood ravishing your small town and rural countryside.
Just how likely did those hundreds of businesses and thousands of workers consider the possibility of two passenger jets crashing into their offices in World Trade Center 1 or 2 just 15 years ago this Sunday?
The Twin Towers of the World Trade Center on 9/11/2011. Let us Never Forget !
911 Twin Towers
So, are you disaster ready? If you're not, you better get ready. The next disaster could impact you and your small business.
We never know what tomorrow brings.