Dave Gorham — December 29, 2016 Follow @stormgeoTry as you might, you can’t stop Mother Nature. Once a powerful tornado or snowstorm decides to bear down on your community, no amount of Harry Potter wand-waving will divert or diminish it.
However, small business owners have the power to minimize the harm severe weather inflicts on a company’s continued productivity. It doesn’t require magic — just some preemptive planning on leadership’s part.
Research by Nationwide Insurance found that only 25 percent of small businesses have such a protocol in place. An alarming statistic, especially when 52 percent of those same respondents said it would take at least three months to recover from a weather-related disaster and 25 percent don’t bounce back at all.
Don’t let the elements catch your company standing flat-footed and wondering which way to turn. Leaders and executives who exercise forethought in advance of winter weather events find the road to recovery is little less slippery.
When It Snows, It Slows
Sixty-six percent of small businesses surveyed by Nationwide don’t have business interruption insurance, so it’s no surprise they feel the brunt of weather-related events more than large businesses.
According to Mark Pizzi, the president and chief operating officer of Nationwide Direct and Member Solutions, that’s due to a dearth of disaster-recovery liability options for small businesses. “Yet they are the ones most affected by a disaster,” he said. “That’s why it’s essential for small businesses to have a disaster recovery plan.”
Weather eats into small-business revenue in a number of ways, some obvious and some not so much. There are obvious ones, like consumers not being able to buy from your brick-and-mortar store, yet others like vendor cancellations are less overt but equally paralyzing.
Delivery interruptions to suppliers may occur because of transportation snafus or unsafe travel conditions; the same may apply to delivery of customer orders. How does a supply chain slowdown impact your inventory, production, and sales?
Employees might be stuck at home, unable to take orders at the office, support customers, and maintain back-end operations. Will you have to hire temporary workers to replace them if they are gone for long stretches or rely on remote workers? Or might their absences force a slowdown or even a shutdown?
A short-lived power outage may delay an employee’s arrival to the shop by only a few hours, but an ice storm’s long-term damage (which can rival that of a hurricane) may keep employees away from work for days, even weeks.
And those power outages don’t affect only your employees. You may find your business without power for days or weeks. Have you made provisions for a backup source of power like a generator (and the additional fuel that will be needed for an extended outage)? Have you made arrangements or even considered moving operations elsewhere?
If raw materials like oil and gas are in short supply, how does that alter product cost? Are you prepared to pay more in such a case? Will you have to raise your prices accordingly? Are you prepared to simply do without or consider substitutions? What will your budget projections and cash flow look like?
Property damage can be extensive after a weather event. Do you have enough property and liability insurance to cover the damage? There’s a real need to determine whether you can afford to rebuild or what steps must be made to fortify your buildings before a disaster strikes. And don’t overlook safety and the time to perform a proper safety inspection. Injuries in newly damaged buildings are common and can range from minor to significant — or worse. Do you have the ability to secure your property and prevent entry?
These are just some things to think about when planning for chaotic weather events. Putting steps in place beforehand, however, makes getting out of that potentially very deep hole a little less harrowing.
Plug the Leaks in Your Recovery Plan
Now that the red flags regarding your disaster recovery planning, or lack thereof, have risen, how will you adjust? Intent is one thing; action is something completely different. And of course, action takes time — something there’s never enough of.
Here are three ways small business owners can shield their shops from leaking revenue, lost production, and broken supply chains when unwelcome weather literally hits home:
1. Back Up Everything. How will employees be notified when bad weather hits? Will they know what to do? Do you have everybody’s home and mobile numbers and email addresses so you can reach them in an emergency? Can they reach you? Is there a system in place, like a third-party 800-number, for them to call to let you know they are OK?
What happens if your supply chain is broken? Do you have another way of getting the supplies you need to keep the doors open? Implement contingency plans all over your business. Back up all established operations to ensure nothing falls through the cracks when storms touch down.
2. Encourage personal accountability. Your employees are responsible for having disaster recovery plans at home, just as you do for the business. However, it may be up to you to encourage them to pre-plan.
If unprepared employees have to deal with weather-related issues at home, they are likely to miss time at work. Yet if they have already made plans for an emergency, they will not only return to work more quickly, but they will also be less distracted about home events and more focused on the job at hand: a win-win for all.
Do whatever you can to ease the burden wild weather events can put on employees. Give them remote work options, later start dates, flexible schedules, and whatever else makes the ordeal easier. Should your HR functions be disrupted, consider how your employees will be paid in the days and weeks after a devastating weather event.
Having a plan in place to address the needs and concerns of the employees before the storm is a significant factor in the return of your employees after the storm.
3. Embrace weather technology. Professional weather services advise businesses on pending weather events. Often, they can tailor their reports to your business needs and specific location. They can let you know how quickly a storm is arriving, how strong it will be and — just as important — when it’s safe to return to normal business operations. They’ll be sure you understand and respond to the threat in a proper and timely manner so that your business remains as resilient and uninterrupted as possible.
These services provide up-to-the-minute weather information so you have time to protect your supply chains and your employees. Use these resources when you look ahead to what steps need to be taken for not just business continuity, but also business survivability.
Maybe you can’t change the weather, but you can change how you react to its consequences by having a disaster recovery plan in place. This goes a long way in stabilizing your business productivity when weather misfortune occurs. It might mean the difference between keeping traction on firm ground or falling through the ice and shutting down for good.
Business & Finance Articles on Business 2 Community(59)
