Maybe your business is not located in a hurricane zone or tornado alley but they aren't the only natural disasters that can occur that dramatically affect a business. When something devastating occurs weather related or not, it demonstrates just how important it is to have a disaster plan in place. You have to be ready for the unexpected.
If you think something like this can’t happen to your business, think again. Here are a few stories of direct marketing industry companies that were hit with disasters – and survived thanks to having a disaster plan in place before the disaster event occurred.
2004 Hurricane Season: When the staff at Global Response, a call center in Margate, FL, saw the weather reports indicating that Hurricane Frances might be headed their way, they sprung into action. “We immediately set up conference calls with our clients to notify them in advance of our contingency plans in case of the weather,” recalls Barbara Turner, director of operations. “We had a document for each client indicating what they wanted us to do in the event that we experienced any weather-related difficulties.”
Being based in Florida, Global Response says it has always maintained a Disaster Plan, including a Command Team of key employees in the operations and IT departments who were on-call and meeting several times each day during the crisis. In addition, a Volunteer List was established, comprised of staff people who were willing to stay on site at the call center and work around the clock during the storm. For many staff people, this was actually a blessing, says Turner, who explains, “Our facility is actually a designated shelter, and many of our staff people live in mobile homes. So we welcomed them to stay on site and even bring their families to work. We had other employees who volunteered to run day care and entertain the kids since the schools were closed.”
Adds company CEO Herman Shooster, “Our buildings are like a fortress. None of our technology is on the perimeter, so all of the operations are safe. And there is food and water for all the staff inside. It is a safe place for everyone to remain during the storm.”
Though Global Response never experienced any outages during the September storms, Frances, or Jeanne--which also impacted the area later that same month – the company is pleased with how well it came through the disaster. It received several complimentary calls and e-mails from catalog clients and even received flowers from one client. Global Response says the bottom line was its customers were pleased that that it stayed on top of the situation and kept them informed during a difficult time.
Winter Snowstorm: In February of 2003 heavy snowfall on the East Coast caused the roof to collapse on a roughly 80,000-square foot section at ClientLogic Marketing and Communications’ Dover, DE, facility. The company immediately established a recovery team to evaluate the damage and set up a command center at the Dover Sheraton Hotel to keep employees informed as to the developing situation, the Dover Post reported.
Earthquakes Rock the West: It was in 2001 that an earthquake measuring 6.8 on the Richter scale rocked the Seattle area, causing power outages and some damage to area businesses. Recreational Equipment Inc. (REI) catalog, for instance, went without electricity for several hours, according to Catalog Age magazine. The fact that the company had a backup generator for its Web site meant online business could continue without interruption. However, Help Desk staff had to evacuate while the building was being checked for damage, so a message went out that operators were temporarily unavailable to assist customers due to an earthquake.
But not all companies are as ready for disaster as these companies were. In fact, more than one-third of the world’s leading companies report they are not sufficiently prepared to protect top revenue sources, according to the 2003 Protecting Value Study. In addition, 100 percent of the companies surveyed report a major disruption to a top revenue source would have a negative impact on earnings, with 28 percent stating such an event would threaten business continuity.
The study, by commercial and industrial property insurer FM Global, the Financial Executives Research Foundation and the National Association of Corporate Treasurers (NACT), polled nearly 400 CFOs, treasurers and risk managers at U.S. and international companies across a variety of industries. Among the other findings of the second annual study:
- 80% of companies report no significant shift in their risk management outlook post-9/11, either strategically or operationally.
- 88% of financial executives say their companies’ level of preparation to recover from a major disruption to a top revenue source is “less than excellent.”
- 59 percent of the companies participating in the study report the greatest impact on revenue sources would derive from property-related hazards, including fire or explosion, natural disaster, terrorism, theft, mechanical or electrical breakdown, service disruption, a supply shortage, labor strike or cybercrime.
This last threat brings up an important point to note: Nowadays, you must also add in the Internet risks such as viruses, worms, spam and intentional hackers. Therefore, strategies that protected your company from disaster 10 years ago may not be sufficient today. You must review your Disaster Recovery Plan and see if it has stood the test of time and takes into consideration all of the current technological possibilities.
Another urgent message to companies is you have to practice your Disaster Recovery Plan. Ask yourself, is it executable? Has your plan been updated periodically? Only if you check it regularly and test it will you know it is going to work when you really do need it one day in an emergency situation.