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In Case of Emergency: Create a Disaster Plan

In Case of Emergency: Create a Disaster Plan

By Chris Penttila | Entrepreneur Magazine

A smoke alarm or a life preserver may save your life, but they won’t save your business. You need a real disaster plan now. Your business’s survival depends on it.

Lonnie Lehrer thought he was prepared for anything. The CEO of Leros Point to Point, a New York City limousine service, had redundant computer systems for his dispatch software, battery backup for each computer, off-site copies of his customer data, even a spare generator. If New York were nailed by a bad winter storm or another big blackout, Leros would still be in business.

Then the first plane hit the World Trade Center on September 11, 2001, and all Lehrer’s plans went down with it.

“Ninety percent of our business is tied to the airports,” says Lehrer, 55. “We went from being a $7 million company to a $700,000 company overnight.”

Lehrer knew if he didn’t move fast, he’d be out of business in a week. Within two days, he’d slashed his own salary by 50 percent, negotiated a moratorium on loan payments with Ford Motor Co., and told his drivers they’d be facing a few lean months of partial salaries until business picked up. He also had to drop drivers who were independent contractors, lay off two staffers and reassign others temporarily.

But Lehrer’s quick reaction paid off. Business slowly returned and is now better than ever: Leros recently acquired two smaller companies and expanded operations, bringing annual revenues to nearly $9 million in 2002.

Another reason for Leros’ rebound: “Some of our competition disappeared after 9/11,” Lehrer says. “The ones who were already on shaky ground just faded away.”


Better Safe Than Sorry
THINK YOU’VE GOT EVERYTHING COVERED IN YOUR DISASTER PLAN? MAKE SURE WITH OUR SURVIVAL CHECKLIST.
  • Stock up on emergency supplies and information. The American Red Cross offers several comprehensive guides on what to do before disaster strikes.
  • Create a list of all your employees and how to reach them. Remember to distribute copies to emergency team leaders.
  • Set up a remote call-forwarding service with your phone provider. In the event of a crisis, you can quickly re-route all calls to a new location.
  • Identify places that can be used as temporary relocation facilities.

    Make arrangements with hotel chains or conferencing facilities before a crisis so your company and your employees have priority if space becomes scarce.

  • Back up all computer data every night and store it in a secure, off-site location. Online backup offers several advantages for small businesses, including the ability to access your data from remote locations; @backup and Connected TLM offer a wide range of data storage services.
  • Make emergency arrangements with a service provider. If your business relies heavily on computers for its day-to-day operations, arrange with providers such as Agility Recovery Systems or Sungard Availability Services to have replacement systems available within a specified number of hours.
  • Document duties and responsibilities for each job. That way, someone can step in when a key employee is incapacitated.
  • Consider business interruption insurance. For more information, visit the Insurance Information Institute’s site.
  • Think about hiring a crisis-management or business continuity consultant. The Service Core of Retired Executives has 389 offices in the United States that offer crisis-management counseling to small businesses. You can find the one nearest you at

    www.score.org.


Daniel Tynan is a freelance writer living in Wilmington, North Carolina.