Does Your Business Need a Natural Disaster Response Plan?

Business owners need to think about a wide range of issues and have backup plans upon backup plans for any primary plans that go wrong. But do they really need to have a formally written plan for how they would respond to various natural disasters? And either way, how can you make a business more resilient to natural disasters?

The Value of Natural Disaster Preparedness

It’s important to take the potential threat of natural disasters seriously in your business. In some areas, and under certain circumstances, a single natural disaster could spell doom for your operation.

As an example, a major flood could be devastating to an unprepared or underprepared business. Water damage cleanup has become considerably more advanced in recent years, but there are still limits to what it can accomplish. Even if efforts go relatively well, your business will likely be closed for at least a few weeks during the cleanup, and even if your insurance policy covers the damage, your premiums could increase as a result.

If you’re adequately prepared for natural disasters, you’ll be able to prevent or mitigate most of this damage, you’ll feel more confident about being compensated for this damage, and you’ll have a roadway to get your business back online once the disaster has passed.

Does Your Business Need a Formal Natural Disaster Response Plan?

Do you really need a formal natural disaster response plan?

That depends on many factors, including:

·       Your area. Some areas are highly prone to certain types of natural disasters, while other areas are significantly insulated from most disasters. For example, if you run a business in California, it’s a good idea to be prepared for earthquakes. If you run a business in Tornado Alley, you should be prepared for tornadoes. But if you run a business in an area with few, if any natural disasters, or if you operate exclusively online, you can probably get away without a disaster plan.

·       Your risk tolerance. You also need to consider your personal and business risk tolerance. If your business is extremely resilient and flush with cash, and you have multiple locations in different areas, the value of a natural disaster response plan goes down. If your business is already fragile and you’re not sure how you could survive after dealing with a weeks-long disruption, a response plan is much more important.

·       Your physical assets. Your physical assets also matter. Are you able to continue running the business even if you lose your entire physical location? How much money do you have tied up in your physical assets?

·       Your employees and customers. It’s not just about property; you also need to consider the employees, customers, and other people in your place of business. If your business is typically full of people, a natural disaster response plan is critical for their safety. In some situations, you may even be required to have an emergency evacuation plan.

Making Your Business More Resilient

These strategies can make your business more resilient, regardless of whether you choose to formally document your natural disaster response plan.

·   Migrate to the cloud. To the extent you can, consider migrating to the cloud. Hosting your own data and utilizing your own technological resources have advantages, but these physical assets open you up to more vulnerabilities as well.

·   Invest in insurance. A robust insurance policy can provide ample financial protection to your business. However, it’s important to read your policy carefully and make sure you’re covered for the most common natural disasters in your area. This is far from a guarantee.

·   Install physical protection measures. Depending on your risks, it may make sense to install physical protective measures. For example, you may have safes or vaults to protect your most critical assets, or fire suppression systems to combat wildfires.

·   Add alarms and communication methods. In the event of an emergency, you need to be able to communicate. Automatic alarms, PA systems, emergency lights, and other installations can provide this system of communication.

·   Devise an escape plan. If a natural disaster affects your business, where will people go, and what should they do? Document multiple escape options and make those plans plainly visible in multiple locations.

·   Employ drills. Make sure your employees are educated and trained to respond properly to a natural disaster in progress. Through drills and ongoing practice, you can condition your employees to respond effectively.

·   Consider opening multiple locations. The more locations you have, the less likely a single natural disaster will be to wipe out your entire business.

Not every business requires a natural disaster response plan, but this can be a valuable tool for businesses especially susceptible to natural disasters. Either way, it pays to be proactive in making your business more resilient to natural disasters and other disruptions.