April 16, 2012 | last updated April 21, 2012 8:44 pm

When Disaster Strikes | Why business continuity planning is important and why you need it

Contrary to popular belief, most companies and organizations categorize business continuity planning as risk aversion or an insurance policy. Although similar, business continuity planning comprises the steps, policies and procedures that are activated once a disaster has occurred. The object is to recover as quickly as possible so you can minimize downtime. Having a plan in place saves time, money, and possibly your entire company.

Here are four key questions and answers surrounding business continuity planning:

What type of disasters could impact my business?

Last year, New England suffered through a tornado, hurricane and earthquake over a short period of time. Imagine those events ripping through your company. Beyond those obvious disasters, there are things like computer outages, fires, floods, cyber-attacks, viruses, and a whole host of situations that could affect your organization. Bottom line: Be prepared for the worst-case scenario: a loss of your entire organization, including the physical structure and personnel.

So if I have a major disaster, how does a business continuity plan help?

A business continuity plan will not prevent the earthquake, flood or most other types of disasters from happening. What a tested business continuity plan could do is potentially save you thousands, if not millions, of dollars in production losses, your reputation as a business, and your customers and clients. Here's one example. A large manufacturing client in Central Massachusetts says it cannot afford to be down for any length of time. They sometimes have two or three shifts working. It's estimated that if the company was shut down for just one week, it would lose $5 million in production. A clear, concise business continuity plan with policies and procedures could cut that downtime to two or three days. Also, if your competition and your clients find you've suffered a disaster and you cannot respond in a timely manner, your business begins to erode and your clients move to other companies. Once you lose the confidence of your clients, it's extremely difficult to recapture them.

So, who is responsible for the business continuity plan?

It starts from the top down; the entire company has to be involved. Think of it as an extension of your job, one that requires thought and planning. Because if your company goes out of business, you may not have a job.

There are so many changes in my organization. How do I keep a plan up to date?

This is not a one-person project. It's like a jigsaw puzzle: human resources, executives, IT, facilities, applications, production, and other parts of the company all work together and maintain their parts. Although business continuity plans are created for the worst-case scenario, companies use them every day for minor incidents as well.

John Grochowalski is vice president of Monarch Business Resiliency, a Georgia-based business consulting firm with offices in Shrewsbury. Contact him at jgroch@monarchresiliency.com.

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