There are some things we try not to think about, like a tsunami hitting your businesses, or the entire computer network being struck down by a virus. However, good business management requires us to think these scenarios through, and make sure we have a solution for every possible disaster.
Whether the problem is natural or man-made, within your control or outside your control, you need to know how the business will cope. If there is one thing we can learn from the Japanese Earthquake and tsunami, it’s that anything can happen, even to you.
ControlThe best preparation is control. Control includes planning, doing, checking and acting so there is no inch of the business that goes unrestrained. This kind of familiarity can ensure that in the event of a disaster, you know which departments will be most effected, what they are doing and where they’re located. This also means you’ll be able to accurately anticipate impacts on production, transportation, use and disposal of your products.
Assess riskBy gauging the natural and built environment in the area, you’ll be able to cater and emergency processes to events more likely to occur. It’s a good idea to calculate the probability of the disaster happening near your business, how severe it would be and how early it would be detected. For example, it is a well-known fact that Japan is located on the ring of fire; meaning that any emergency plans or risk assessment should have a particular focus on earthquake, volcano, or coastal emergencies.
In the case of Japanese nuclear power plants, they may only have found severity risk of magnitude 7.0 earthquakes, rather than 9.0, which had never occurred before. This resulted in inaccurate emergency responses, and the havoc that resulted may have been more manageable if risks were updates regularly.
Lesson # 3:
Prevention is the best protectionWhile most disasters are largely out of human control, some degree of prevention strategy may be exercised either before or during a disaster. For example, if a high likelihood of fire exists during the fire season for a rural business in Victoria, their ratings of severity and probability for this kind of disaster would increase. This could trigger the procurement of more fire extinguishes which may prevent the spread of a fire in the building.
ManagementPrepare how you will manage staff, and business operations in the event of a disaster. Make sure all staff are familiar with the same plan of action and meeting place, a quickly being able to identify missing people is essential in an emergency.
RecoverySometimes the disaster itself is not what brings a business down, it’s the inability to react appropriately to the disaster and continue operations. Ensure you risk management plan addresses the road to recovery, whether it be through emergency funds or back up communication systems. If networks and phone lines are temporarily unavailable, how will you communicate with employees and clients? Which sectors of the operation will be more salvageable than others? For example, a clothing business might have an alternative location on higher floors of the building to move to in the event of a flood.
Sometimes you need to consider the worst possible situations for your business, in order to achieve the best possible outcomes.