Disaster management is like insurance, you hope you never have to pull out your policy and make a claim but they’re imperative for your business’s survival. The reality is very few business owners take the time to plan out a contingency of the worst case scenarios for their businesses, as said before this is like operating uninsured.

Remember a disaster doesn’t just have to be a natural event such as flood or cyclone it could as simple as loosing power for two hours or two days, loosing an internet connection, phone lines or key employee. These are all internal disasters but also consider external ones such as a key customer or supplier going into liquidation, legislation changes to your industry, product call backs and so on. Regardless of whether you have control over it or not you can always plan for it.

So let’s take the three most common disasters and look at what others have done to overcome these potentially crippling events. Firstly loosing a key staff member. They could be a manager, trade person or buyer who plays a pivotal role in your business. A role so important the business cannot operate without it. Notice I said role and not person. See the first step in disaster manager is to have a plan b, a contingency. So in the case of a key staff member leaving you should either have another team member trained in that role or be able to complete the role yourself however the former is the better option.

Power outage is another common disaster, we just enjoyed three days without power and I can tell you, it’s a humbling experience. So the blindingly obvious is to have a generator on hand ready in case of a power outage but this is only the physical tool for the job. You need to have a written process for what happens when the power goes out. Cover things like evacuation, who’s in charge, how to account for everyone and so on. It should be something all staff are trained in and capable of performing.

Lastly a key supplier or customer going down. Well it happens and quite often however it becomes easily preventable should you structure the business right. Either have alternates always available or keep enough cash or product in reserves to get by for at least three ordering cycles. Why three, well because two aren’t enough.

The key to this exercise is to write out your worst case scenarios in business and then make contingency plans for them. Nothing is too far fetch, remember it’s the disaster that you don’t plan for that could hurt you. Take the time to plan thoroughly, consider it your insurance policy.