June 1 marks the start of hurricane season, so it’s a good time to manage risks and prepare for both natural and man-made disasters.
Hurricane Irma had a huge impact on businesses across the state of Florida with estimated insured losses reaching over $8.6 billion, according to the Florida Office of Insurance Regulation. Worldwide, overall losses for businesses from natural disasters alone came to $330 billion in 2017, according to Munich Re, a reinsurance company.
Your company should be taking a look at your Disaster Recovery Plan (DRP) and Business Continuity Plan (BCP) this season. As CEO, it’s important to analyze potential risks that could damage your company.
Today, we’ll focus on what these plans are and their functions.
Disaster Recovery Plan
The Disaster Recovery Plan is a detailed document with instructions on responding to unplanned events. The role of this plan is to help companies respond quickly to incidents to minimize lost revenues and give the businesses the best chance for survival.
The primary responsibility of a DRP generally lies outside of an organization’s finance department. It’s common for an internal IT department to take responsibility. Here are a few questions a CEO should keep in mind:
Having a good DRP will help detect issues as soon as possible, correct issues, restore functionality, and prevent what is able to be prevented. After a disaster, between 40 to 60 percent of small businesses never reopen according to the Federal Emergency Management Agency (FEMA), so it’s best to be prepared.
Business Continuity Plan
The DRP is encompassed in the BCP, which keeps your business running despite any issues or obstacles. A good plan will help reduce the chance of a costly outage. Executive staff members often help IT administrators create the plan to help ensure the plan is regularly updated.
When developing the BCP, try to get creative, be thorough, and plan for any and all failures. Here are several key questions C-levels should ask themselves:
At CFO Strategic Partners, we know how to prepare for approaching hurricanes and other disasters. Although risks may start off small, there’s always potential for them to grow and gain the strength to do incredible damage to your hard work. Email us at firstname.lastname@example.org or call (407) 426-8288 to discuss how to better prepare yourselves for imminent risks.Tags: business, Business Challenges, Business Owner, Business Owners, Business Practices, Ceo, Cfo, Cfo Resource, Chief Financial Officer, Confidence, Finance, Financial Consultant, Financial Expertise, Financial Management, Financial Professional, Financial Projections, Financial Security, Financial Success, Insight, Knowledgeable Professional, Strategic Partnering, Strategic Partners, Strategic Plan, Strategy