If you own a small business, you probably have a business plan, a financial plan and a tax plan. But do you have a disaster recovery plan? If you don’t, a disaster might put you out of business permanently. Here are some tips on how to develop a disaster recovery plan for your small business.
Assess the risks – “Many types of disasters can strike a small business, including fire, flood, earthquake, power failure, vandalism, sabotage, pandemic and terrorism,” says Chartered Accountant Steve Brown, a senior manager with Soberman LLP in Toronto. “But in this day and age, the biggest risk is loss of data due to a computer crash. If something happens to your computer system, you’re out of business.” Analyze what each of these disasters could do to your business and then design a recovery plan that meets your organization’s specific needs.
Set objectives – “The main purpose of a disaster recovery plan is simple: business continuity,” says Chartered Accountant Saverio Rigillo, an associate with Fazzari Partners Chartered Accountants in Vaughan. “Business interruptions cost money and time you won’t get back.” The other major purpose of a disaster recovery plan is preventing a disaster in the first place. “Understanding what could happen and developing a plan to deal with it can also help identify preventative measures you can put in place, such as a back-up electricity supply, surge protectors and anti-virus software,” says Brown.
Secure your critical data – “Decide what data is critical to your company, back it up regularly and keep the back-ups off-site,” advises Brown. Focus on the data that exists only in your records, such as customer and staff information, as opposed to data you recover from other sources. “Keep in mind that if your place of business is inaccessible, you will need a way to contact your staff at home, so make sure you have that information stored off-site,” adds Rigillo. In addition to securing data, larger businesses should also consider arranging back-up operating locations and equipment.
Determine how you will communicate with your customers – “External communications is extremely important if disaster strikes,” says Rigillo. “If possible, your plan should include the ability to send a broadcast e-mail to customers letting them know what has happened and how long the business interruption will last. You can also place a message on your phone’s voicemail to let customers know what the situation is.”
Review your plan – “Those responsible for the plan should meet regularly to review and update it,” suggests Brown. “Make sure your employees are familiar with the plan so they know what to do if disaster strikes.”
Don’t do too much…or too little – “Your small business may not need an elaborate disaster recovery plan, but you can easily put a simple plan in place that identifies such things as how long it would take you to recover critical data and get back up and running,” says Rigillo. “If you take the time to assess what you could lose in the event of a disaster, you will soon realize that developing a plan is worth the investment of time and money.”
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The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario’s 33,000 Chartered Accountants and 5,000 CA students. Since 1879, the Institute has protected the public interest through the CA profession’s high standards of qualification and the enforcement of its rules of professional conduct. The Institute works in partnership with the other provincial Institutes of Chartered Accountants and the Canadian Institute of Chartered Accountants to provide national standards and programs that are used as examples around the world. </em>
