This is part one of a five part series covering disaster recovery and business continuity planning. Both should be in the forefront of every business owner’s mind. The Louisville community has experienced ice storms, snow accumulation, tornadoes and flooding. Add to the mix the potential for train derailments, hazardous material spills, infrastructure failure, and bio-terrorism and in other parts of the country earthquakes and hurricanes. According to the Wall Street Journal, 43% of businesses that sustain a major disaster never re-open.
In addition to the disasters listed, other types of interruptions should also be considered, and may strike more frequently:
- Power failures
- IT system crashes
- Supply chain problems
- Water main break, which happened recently near University of Louisville
A disaster recovery plan (DRP) should be an integral part of every business continuity plan (BCP). Business continuity is a proactive approach focusing on how to avoid or mitigate the impact of a risk or disaster. Disaster recovery is reactive, focusing on how to pick up the pieces and restore the organization to business as usual once a disaster, natural or human induced, has hit. When developing a plan also consider these adversities may not directly strike your company but your vendors or customers which will impact you.
No matter what industry, planning for a disaster is smart businesses. According to Peak 10, the data center Metro Louisville is using for the city’s recovery solution, for a $14 billion corporation the average cost for lost time is $50,000 per minute; $50 per minute for a $14 million company. Scaled to the size of a small business, $2,400 is lost per eight hours of downtime.
For any disaster consider one of these three measures:
- Preventive – If controls are in place, can the event be prevented from occurring?
- Detective – If controls are in place, can the event be detected before occurring?
- Corrective – If controls are in place, can the company recover?
Before beginning to develop a disaster recovery plan, the organization’s business continuity plan should be used to identify the key metrics of a recovery.
Part two’s article will detail what to include in a business continuity plan.