How to Create a Disaster Plan for Your Business

Here are seven ways to ensure you don't get left adrift if disaster strikes.

By Nancy Mann Jackson

Opinions expressed by Entrepreneur contributors are their own.

Hurricane Sandy left thousands of unprepared business owners in the Northeast without power, phone service, the Internet and access to bank accounts and other necessities. It was a stark reminder of how everything can change overnight.

Careful planning can help you minimize losses and emerge relatively unscathed from a disaster. Here are seven steps that can help you develop an emergency plan and ensure that your business is as prepared as possible for the next calamity.

Related: NYC Entrepreneurs Stand Up to Hurricane Sandy

1. Work from home for a day.
"The simplest way to perform a readiness test is to stay home," says Ken Menken, CEO of Capalon Communications, a Maryland-based provider of IT 
and communications services to small businesses. "With your office off-limits, what are you unable to do [remotely] for your business? The answers may surprise you, and you'll quickly know what you need to move or back up out of the office." For instance, one Capalon client told his staff to work from home on the day Sandy was scheduled to hit. That's when he learned that several employees didn't have a home router for multiple devices or had a firewall blocking Internet telephone service, which was a critical element of the company's disaster recovery plan.

2. Make a comprehensive list of essentials.
When helping clients develop emergency plans, Adam Zweibel, president of Alpha Technology Group in Livingston, N.J., discusses each item they would need to keep their business running after a disaster. From that list, they then develop various contingency plans. "A client with multiple offices, for example, might need a way to access their calendar and redirect appointments to another location, while a client with an archive of historical files might need to have instant access to those files if a server goes down or gets submerged underwater," he says. "Our advice is to actually map out an absolute worst-case scenario. What would happen if your entire office was flooded or burned to the ground? Think about everything you would need to keep things moving forward seamlessly."

Related: Business Interruption Insurance: What It Will -- and Won't -- Cover

3. Appoint leaders.
Brandon Lewis, owner of advertising firm Revenue Jump in Greensboro, N.C., recommends choosing specific leaders to oversee the company in the aftermath of each likely threat, such as a tornado, hurricane or fire. "In the event of an emergency, especially evacuations, you can't rely on every employee to remember the emergency procedures," Lewis says. "Leaders must be appointed and they must be trained and retrained regularly on how to implement the emergency plans [for the specific crisis] under their responsibility."

4. Plan for communications.
Develop several ways to alert employees of an emergency, Lewis says. For instance, you may use email blasts, text blasts and voice broadcasting, which allows you to simultaneously send a voice message to everyone's office phone and cell phone. Also, install alarms throughout the building and test them regularly. For retailers and other businesses that often have customers on site, consider installing intercoms to issue instructions to staff and customers at the same time.

5. Move to the cloud.
AppLaunch, a New York City-based PR firm for app developers, kept functioning when Sandy hit partly because all code and project information is in the cloud. "We had every byte of our data
during that week," says CEO Chris Maddern. By providing employees with portable Wi-Fi devices, everyone could access their cloud-based project information and continue working from wherever they were based whether or not they had power. Moving to the cloud doesn't have to be expensive. For example, Newtek Business Services, a New York City-based provider of cloud computing and other services to small businesses, can host a website in the cloud for as little as $6 a month and offers data storage for as little as $4.95 a month. Google Apps provides 5GB of backup space for free, while Microsoft, Amazon Web Services and Rackspace also offer cloud-computing space.

6. Find an alternative place to go.
AppLaunch's emergency plan includes an agreement with Regus, a provider of flexible workplaces, to get access to a backup site. AppLaunch pays $500 a month for access to the space on as-needed basis for six employees. Regus and similar companies guarantee a backup space even in the case of a major storm like Sandy. "Even if the closest option is not functional, there are a variety of other options," says Dan Perrin, senior director of workplace recovery at Regus, which has 1,200 temporary workplace locations worldwide.

7. Ensure workers' safety.
Be sure to consider what your employees may need in the event of an emergency. For instance, every employee at AppLaunch has a company credit card with $500
 available. These cards are "not for hospitality but for getting to and from work and staying safe in
an emergency," Maddern says. In addition, he and his management staff checked in regularly with their employees throughout the aftermath of Sandy. "We had one developer staying at another's house, and my place was on offer if anybody needed it," he says. "It was important to simply stay in touch and look after each other. Anybody who needed time off could take it without [using vacation days]."

Related: How One Franchise Owner Got His Businesses Running After Hurricane Sandy

Related Topics

Editor's Pick

Have More Responsibilities at Work, But No Pay Bump? Use This Script to Get the Raise You Deserve.
Black and Asian Founders Face Opposition at All Levels — Here's Why That Has to Change
Business News

'This Made Me Physically Recoil From My Phone': Lingerie Brand Apologizes For 'Creepy' Ad Referencing Ryan Reynolds and Bras

Online lingerie retailer Harper Wilde is under fire for a bizarre sponsored post it has since pulled from Instagram.

Thought Leaders

5 Small Daily Habits Self-Made Millionaires Use to Grow Their Wealth

We've all seen what self-made millionaires look like on TV, but it's a lot more subtle than that. Brian Tracy researched what small daily habits these successful entrepreneurs adopted on their journey from rags to riches.

Business News

Viral Sensation 'Popcorn Guy' Has Earned a Gig at the 2023 Oscars

Jason Grosboll first went viral on TikTok for his theatrical method of buttering popcorn in a Texas movie theater.