The term ‘crisis’ instantly drives a sense of a by-product of natural disasters including tsunami, earthquakes, etc. But there are other types of crises too that occur due man-made activities, existential crises, and business crises. The last one is what we are here to discuss in this article.
There are a number of situations that can cause great damage to your company irrespective of your industry, size or resource. Businesses are needed to be susceptible to crises which is why it becomes essential for them to be prepared for anything that comes their way to avoid a corporate downfall.
There is a famous quote by Benjamin Franklin that goes, “By failing to prepare, you are preparing to fail”.
A crisis management plan is what you need to immune your business to the possibility of one of these unforeseen events. Implementation of this plan, understanding stages of a crisis and ensuring you have the right people around you to help your business sail through the crisis.
Small businesses are highly vulnerable to these crises as they often lack the resources to cope up easily. Which is why they need to plan thoroughly to avoid loss due to situations like theft, fire, IT system failure or illness of key staff. You risk losing your customers while you fight to get your business back to your feet. And in the worst-case scenario, you may not be able to recover and ultimately cease trading.
Business Continuity Plan
A business continuity plan, if carefully thought, will ease your way in coping with a downfall due to crises and minimize disruption to the business & its customers. A proper plan will also give out a message to the customers, investors and insurers that the business is immune to crises and disasters helping you gain an edge over your competitors.
Acces possible impacts
The first thing you need to do is to analyze the impact a crisis can have on your business. This could be done by accessing the likelihood of occurring of a crisis and the frequency of its possible impact on your business.
This will not only help you identify its impact but will also help you in figuring out what functions are necessary for your day-to-day business operation. This you can identify what operations are not critical to carry out during a disaster like situation.
How likely is a risk to occur?
It will help you in calculating the probability of occurring of a crisis and marking them as high, medium and low. It will also help you in concluding how your business will react towards each risk. With this you can decide the necessary actions to be taken during each type of crisis.
Identifying the possible impact of the crisis
Determining the potential impact of a disaster or a crisis on your business is critical. It helps you in preparing for the worst-case scenario and what your last resort will be if the crisis proves to be debilitating for your business.
For example, what will be your response to a server failure, a hackers attack on your database, a theft where your computer systems are stolen or are damaged by a flood or fire in your office which destroys your entire office premises?
You need to put yourself in your customer’s shoe while thinking about the consequences of a crisis. Would you look for an alternative supplier in a situation like this? Always ask yourself, “Would you be able to keep up with you SLAs if any of the situations mentioned above become a reality?.
(i) Minimizing potential impact of crises
Once the risks have been identified, you need to think and work on the measure to immune your business to these risks.
(ii) Safeguarding premises
Install all essential safety features in your office including electric and gas safety, fire safety, fire alarms and extinguishers. Also keep an alternative ready in scenarios where your current premises couldn’t be used.
(iii) Protecting your data
You need to install anti-virus software, backup your data and ensure right maintenance agreements are in place to help protect your systems and data. You might also need to have a strong IT team that helps you in keeping safety measure up to date with measures to secure your data and systems.
It is also advised to get copies of your customer database printed to ensure you connect with your customers easily even when you IT fails.
(iv) Avoiding dependency on few people
Encourage your core group to train others so you do not have to be dependent on a few staff members. Also, keep your options handy by making sure you get a temporary cover from a recruitment agency in case you are deprived of several key staff members.
(v) Getting insured
Insurance is the first thing that comes to mind while planning a risk management strategy.
(vi) Other key steps include:
Getting your operations running again as quickly as possible
Resource needed to carry out these operations
Roles of individuals during crises
Making the most of initial hours after an emergency occurs is critical in minimizing its impact
Checklist to make sure every step of the plan is followed in the manner they should be
Assign a spokesperson to deal with a potential media interest strategically and positively
(vii) Testing Business continuity plan
Once you have planned your way out of any emergency situation, it is important to put your plan to test to know how likely it is to perform during those times. Crises are hard to stimulate, yet you need to assess your plan against various possible scenarios as a part of the paper-based exercise. But you need to figure out things that would cause most damage to your business and plan accordingly.
(viii) Keeping plan updated
Last but not least, keep your plan updated to take into account the changing circumstances of your business operations. Even a slight change can set your business under an entirely new set of risks. It is recommended to test and update your plan form time-to-time even if your business has not undergone any changes. www.bthawk.com