News & Articles

Human Resource Management
Published in the Rochester Business Journal
February 24, 2006
© 2006 HR Works, Inc.

Crisis-preparedness plans pay dividends in reducing risks, keeping businesses functioning

By Candace Walters

“Before anything else, preparation is the key to success.”
-- Alexander Graham Bell

Were a disaster to strike your company tonight, how well prepared are you to respond? Would managers and employees know what to do and where to go? If your primary place of business were severely damaged, could your organization function at another site? If not, how many days of down time could your business afford?

If you’re like most companies, you carry business insurance, you have backup IT systems in place so that key data are both safe and accessible, and you use non-compete agreements to protect trade secrets.

But ensuring business continuity during and after a crisis requires more extensive planning. The American Red Cross reports that some 40 percent of small organizations do not reopen after a major disaster like a flood, tornado or earthquake -- and natural disasters represent only a few of the possible risks. Businesses risk everything when operating without plans to respond to and recover from fires, explosions, winter storms, toxic material releases, power outages, theft, civil disturbances, workplace violence and terrorism.

Unfortunately, despite massive publicity about the tremendous blows suffered by countless businesses in Hurricane Katrina, the 9-11 attacks and other catastrophes, many companies today remain unprepared. Some employers postpone crisis planning because they think a disaster won’t happen to them, or they fear planning will require too much time and money. Other companies rely on untested plans that fail to function when they’re most needed.

Practical approaches

Most companies with crisis plans outline them in the employee handbook, and some are adding them to company intranets, accessible from various locations.

The YMCA of Greater Rochester publishes a 36-page booklet for its nearly 4,000 managers, employees and volunteers, describing emergency procedures for every contingency from pool accidents to robberies to fires, says Fernan Cepero, vice president of human resources. The Y’s safety director updates the booklet annually with current phone numbers for key personnel and other changes. Employees are invited to keep a copy at home as well as at work.

Training is a key part of the Y’s preparedness, Cepero says. The law requires certain Y employees and volunteers to obtain and maintain proficiencies in various skills – for example, handling chemicals, conducting CPR and/or guarding against child abuse. Supervisors ensure that recertification training takes place on schedule. The Y conducts additional training as needed by function.

The emphasis on preparedness is different but just as serious at EPIC Advisors Inc., a provider of custom retirement programs. James Genthner, senior vice president, notes that as a full-service recordkeeping firm, EPIC knows how vital it is that electronic data be stored securely offsite and be accessible in multiple ways.

To minimize disruption from power outages, EPIC chose to locate in downtown Rochester because of the city’s overlapping power grids, which offer backup in case one grid goes down. EPIC also has a generator on hand in case all grids fail.

In addition, EPIC has brought in a fire marshal to review the company’s safety procedures and conduct drills, and employees know where to meet in case of emergency.

At American Classic Outfitters Inc., a sports-apparel manufacturer in Perry, the emergency plan centers on ensuring employees can readily access information. ACO’s plan separates crises into two types: those that occur overnight, and those that occur during the workday.

Taking the first steps

For those ready to review or begin developing their crisis plan, Cepero advises first contacting the organization’s insurance broker or agent. Since the insurer has a stake in helping its insured identify and reduce risks, the agent should be willing to tour the company’s facilities and sit down with representatives to help create a plan. Many insurers offer discounts on premiums for companies that create and practice their crisis plans.

Free resources also are available, he adds, through the Red Cross and the Department of Homeland Security’s website. Www.ready.gov/business/index.html offers checklists that enable businesses to develop plans inexpensively. In addition to meeting with insurers and safeguarding electronic data, experts advise that every company:

• Assign a leader or team to develop and execute a crisis-response and -recovery plan.
• Evaluate the kinds of emergencies that might affect the company, both internally and externally. Consider the potential impact of each type of disaster in terms of employee safety, lost revenue and lost control of operations.
• Create and practice procedures for quickly evacuating or sheltering in place.
• Consider providing first aid and CPR training to key employees.
• Draw up a contact list with emergency information for managers, employees, fire and police departments, building supervisor/landlord, insurance agent and other key business contractors.
• Engage in two-way communication about emergency procedures with employees early and often, rather than waiting until disaster strikes.
• Set up a telephone tree, password-protected page on the company website, email alert and/or call-in voice recording to communicate with employees in an emergency. Know how you will communicate if some or all employees lose electricity, telephone and internet service.
• Decide in advance how business will be conducted if the organization’s building is unusable.
• List inventory and equipment, including computer hardware, software and peripherals, and store backup insurance and inventory documents off site.
• Ensure that fire extinguishers and smoke alarms are working, and develop portable emergency supply kits.

Conclusion

Developing a crisis response plan and training employees pays dividends beyond the most obvious benefits of saving lives, preventing serious injury and keeping the business going. Cepero has seen how well-trained and well-informed employees feel empowered and secure, while managers feel confident that they can leave the business in the hands of a capable staff.

Specifying the chain of command and communicating clearly are crucial. A plan that gets tossed in a bottom drawer won’t help when the drawer is on fire or under water. Employers must ensure that all employees are familiar with and understand the plan, and can access guidelines even when their work stations are inaccessible.

Clearly, doing business without a tested disaster plan in place is the riskiest of all strategies. Organizations have everything to gain by beginning this process as soon as possible.

Candace Walters is president and CEO of HR Works, Inc., an HR management outsourcing and consulting firm serving more than 600 clients in the Rochester, Buffalo, Syracuse and Baltimore/Washington areas. HR Works provides HR Department outsourcing, part-time and interim HR managers, affirmative action plans, HR*Stars recruitment services, legally reviewed employee handbooks and supervisor manuals, compensation programs, training and more. To offer comments, write walters@hrworks-inc.com

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