In the face of a natural disaster or another significant disruption to daily life—like a pandemic—it can be difficult to rebuild. For small business owners in particular, picking up the pieces and starting to serve customers again can be especially difficult. In fact, a FEMA report states that about do not reopen after disasters. However, there are actions small business owners can take to help their business survive and continue running after a major disruption or disaster.
One solution is to build a small business continuity plan. This plan is an outline of procedures to help prepare small business owners for events like a natural disaster, cyberattacks or global health pandemics. But creating a business continuity plan is no simple task. From determining the resources needed to keep your business running to identifying possible threats, there is a lot to consider. This guide aims to help you better understand what a business continuity plan is and how to create and execute this plan for your business.
What is a small business continuity plan?
A small business continuity plan is a strategy used to restore interrupted business services, ranging from natural disasters (e.g., floods, fires, earthquakes) to lack of economic resources and even utility disruptions.
Many people think a business disaster plan and emergency plan are the same as a business continuity plan. However, they are slightly different. A business disaster plan provides detailed steps employees should follow during and immediately after a disaster. A business emergency plan details how to get away from danger and can involve drills and training sessions to prepare employees for an emergency. A business continuity plan dictates how a business can continue to operate during a disaster or emergency.
It is common for an emergency and disaster plan to be a part of a larger business continuity plan, as they both provide solutions to the unexpected possibilities a business may encounter.
What does a small business continuity plan include?
A business continuity plan will look different for all small businesses. However, here are some key components you should consider when setting up a small business continuity plan:
- Take an assessment of risks and the potential business impact. Conduct a business impact analysis to identify potential risks and vulnerabilities within and outside the business.
- Plan an effective response to these risks. Develop an appropriate response strategy to minimize or prevent these risks.
- Identify key personnel. Determine what members of your staff will be involved in responding to the business disruption and their responsibilities following the disruption.
- Have an effective communication strategy in place. Know how you will communicate with staff and outside contacts (e.g., suppliers and customers) so that all parties know how the business is responding to the disruption.
- Implement testing and training measures. Make sure every business continuity plan is tested so that you and your team can take action to improve it before a disruption occurs.
5 steps to building a small business continuity plan
Now that a framework for a small business continuity plan has been established, it is time to get started actually building out your plan. Here are five steps to create one that gives your small business a strong chance of recovering from a major disruption.
Step 1: Form the small business continuity management team
The formation of the business continuity management team will vary depending on the size of your small business. However, this team should include someone from upper management leading the team, as this sends a clear message to other employees that creating a strong continuity plan is a top priority.
No matter who ends up on the team, it is important to have clear titles and responsibilities listed and delegated to each member. This includes: contact information, backup contacts and specific duties the member carries out to keep the business running smoothly.
Step 2: Conduct a business impact analysis
Once your small business has assembled a business continuity management team with clear roles and responsibilities, then the team can perform a business impact analysis (BIA). A BIA is an assessment of outside potential threats or risks and their impact on each aspect of the business. These threats or risks can be operational, financial and physical.
A typically requires a comprehensive questionnaire, but, at minimum, should include all core business operations and identify which of these are critical for business continuity. Essentially, the BIA should record any resources necessary to keep critical departments or operations afloat during a disaster. The small business continuity team should examine each function of the business and classify it as either high, medium or low priority. Based on these ratings, the team can identify which critical business processes are most important to keeping the business afloat during a disaster.
Step 3: Identify what resources your small business needs
Once your small business continuity team completes the BIA, they will have identified and documented potential risks that can affect your business in the wake of a disaster or disruption. Now, the team should identify what resources would be necessary to recover from such an event. If the business does not have the resources available to recover from the disruption, then this reveals discrepancies in the business resources.
The small business continuity team should further explore how to access these resources before creating and implementing recovery strategies. Access to resources may determine what types of recovery strategies will be most effective for the small business.
Step 4: Create recovery strategies to maintain operations
This is perhaps the most detailed section of the small business continuity plan, as it details readiness procedures. These procedures can include prevention strategies (what your business does before the disaster occurs); response strategies (how your business responds during the disaster); and recovery strategies (what your business does to continue operations after the disaster). For each disaster scenario compiled in your business impact analysis, there is a prevention, response and recovery strategy in place.
Note that as your small business continues to evolve, the risks and threats will change. Therefore, it is important to revisit these strategies.
Step 5: Test recovery strategies and make improvements
The small business continuity management team will want to work with all members of the staff to train and test the recovery strategies. This could include basic training where the business continuity team gives an overview of the plan. Or the team can plan a day where all employees go through a tactical training exercise, completing mock emergency plans. These mock exercises can be a way to test the effectiveness of the recovery strategies. Based on the results, adjustments can be made to the business continuity plan.
Why business continuity planning matters
Every business continuity plan should be supported from the top down, as this plan can not only keep a business running but also protect the employees that help it function. Having a company-wide plan in case of an emergency is essential and maintaining the plan takes as much care and attention as creating one. Think of a business continuity plan as a long-term goal, not just a project, and as a way to ensure your business can continue to thrive in your community.
CenturyLink is dedicated to providing useful resources to help you make the most of your small business. Check out the CenturyLink Small Business Hub and discover articles on how to build sustainable small business practices, how to start a small business and more.