The recent earthquake and tsunami in northeast Japan has reinforced the need for businesses to be prepared for any type of disaster. Already this spring, businesses in the United States have seen damage from floods, wildfires, tornadoes and severe storms. And hurricane season is just around the corner. So what can you do to help ensure your business is prepared? 

Develop Plans for Resuming Your Business

The first step to protect your business is to develop and to maintain a comprehensive business continuity plan. Recognizing that a thoughtful approach will take time, look at those natural hazards you consider to be most likely to encounter based upon your location, as well as locations of your key suppliers and customers. Begin to think about what you can do now to help minimize the impact from those natural disasters. Once finished, use this effort to fully develop your business resumption plans.

Address your natural hazard exposures

Assess your general exposure to natural disasters or weather-related events. How likely is it that your business will be impacted by a flood, earthquake or wildfire? For additional help with this step, review the Insurance Institute for Business and Home Safety website at disastersafety.org.

Establish a strategy that your business can follow when responding to a disaster. Also, consider the impact of a natural disaster on critical suppliers and your customers. Give consideration to what your response will be before (preparation), during (response) and after (recovery) the event.

Preparation

You may need to assemble a team to discuss policy, planning and development of your plans. These team members should have knowledge about your business operations, the plant/facility, protection systems and available resources to respond to the potential hazards.

Evaluate your facility and operations to determine what existing protection features will address the identified exposures. Your evaluation should determine the current condition and maintenance of these systems. Proper construction and installation of protection systems can often determine whether a building will survive a natural disaster or other weather-related event.

A good place to start is to make sure your building is up to code. If your building predates current codes, you should consider upgrading to meet these requirements. While strictly following current building codes will not prevent all damage, history has shown that non-standard buildings sustain significantly more damage than do buildings kept up to code.

Other preparations include stocking and maintaining necessary materials to support the response and recovery plans. Sand bags, stone, dirt and sand, lumber and plywood, weather radios, snow blowers and shovels, ladders, communication equipment, generators, pumps, chain saws, lanterns and emergency supplies can all prove useful during an emergency.

When planning for these types of emergencies, you should survey the facility to determine the areas of greatest vulnerability. Which processes are critical? What equipment is vital? Are the plant/facility and utilities vulnerable?

With this information and the list of potential emergencies, you should prioritize your concerns. You can then develop the mitigation responses for each item.

Response

Response plans should include steps to take as an event approaches, as well as during the event. Remember that employee safety is paramount when implementing all steps of your plan. Businesses should always take action sooner rather than later. Early warning and implementation of the plan generally provides the best chance for success. Create and practice evacuation plans for all employees, as well as the employees of the emergency response team. The following is important to consider when implementing a response plan:

• Be familiar with all of the available evacuation routes in your area.
• Account for all employees after the evacuation.
• Keep emergency equipment in working order.
• Use communication equipment that operate on batteries or have a backup generator.
• Establish and maintain alternative methods of communicating with emergency teams and public emergency services.
• Practice your emergency response procedures and plans to determine viability of the methods selected and to determine implementation timelines.

Recovery

Sometimes greater damage can occur after the disaster subsides rather than during the actual event. Open roofs allow for secondary water to enter. Flood hydraulic pressures can push up concrete floors even as water recedes. Fires can start from disturbed propane tanks, broken gas lines or spilled flammable liquids.

Recovery efforts can take many forms: it can include salvage, such as separating damaged materials from undamaged materials, and getting the valued stock into a protected space; it can involve stabilizing and securing structures; it can include restoring damaged sprinkler systems; and it can consist of pumping water out of flooded basements. But it’s also important to understand that protecting the physical assets of your business is only part of the issue. Protecting business relationships may be an even bigger challenge for some companies. You may want to consider the following measures to address the business relationship challenge:

• Developing arrangements in advance with critical suppliers. Without a product to sell, you’re out of business.
• Maintaining a stock of critical forms and supplies in a safe area. This includes purchase orders and invoices.
• Communicating to your customers that you are in business, or if you are temporarily out of business, the length of time before you return.
• Updating your employee/supplier/customer list frequently.

Materials you will need to support the recovery should be on hand wherever practical. Make arrangements for portable pumps, water vacuums, rigging or other items identified in your planning.

Other resources

In addition, consider using other resources to manage your exposure to natural disasters, including local emergency management agencies, local government and the fire department, private sector companies and the Federal Emergency Management Agency (fema.gov).

Remember, natural disasters can occur anytime, anyplace. You can’t control when they will happen, but you can take the necessary steps to prepare your response ahead of time should a natural disaster strike your business. In doing so, you can better manage your exposure to these events. Chances are this preparation will translate into better protection for your business, its assets and your employees.