Tax & Accounting Blog

Ready for Anything

Accounting Firms, Business Practices, CS Professional Suite October 29, 2013

It could be as simple as a downed power line or as serious as the tornados that created miles of devastation in Oklahoma. Regardless of the cause, any interruption to your operation is bad for business. Do you have a plan that will keep the doors open?

A shocking number of businesses don’t. According to Samuel J. Boyle, an emergency management analyst with enGenius Consulting Group in Huntsville, Ala., current studies show that 62% of all businesses don’t have a comprehensive emergency plan.

“Most of these are small businesses,” says Boyle, who works with a number of government agencies. “Whether it’s business continuity or disaster recovery or even an emergency plan to facilitate fire evacuations, they don’t have any plan at all.”

Worse still, 40% of all businesses affected by disasters never reopen their doors. Boyle says small businesses are at the highest risk because they don’t have the amount of insurance coverage or the financial cushion to stay operational.

“When Hurricane Sandy hit the East Coast, more than 450,000 businesses were damaged or destroyed,” he says. “It caused more than $25 million in economic damage to small businesses that weren’t able to reopen. And we can say definitively that about 25% of those were due to lack of planning and insurance.”

Your Parachute

Having adequate insurance coverage for your firm is a necessity no matter what. But it’s not the same as creating a comprehensive contingency plan.

Technology has become an increasingly important aspect of keeping businesses up and running. Whatever might cause your business to shut down, you have to be prepared to respond. The sooner you can get back to work the better – both for your clients and your business.

For starters, backing up all your firm’s data is essential. Boyle recommends what he calls a hybridized method. “It encompasses the values and benefits of having an actual physical backup as well as a digital backup that’s offsite,” he says. A combination of the two gives you the greatest flexibility.

We’ve Got You Covered

Thomson Reuters offers cloud computing options that not only let you work remotely, but also let you back up all your firm’s software and essential client data, as well.

With Software as a Service (SaaS) and Virtual Office CS, all your data is backed up automatically and stored remotely on secure servers. Both options help your business keep on running no matter what happens.

Visit CS.ThomsonReuters.com/Cloud-Computing.

For many companies, says Boyle, a cloud solution is a great way to go. A cloud-based solution keeps information secure and can be accessed from anywhere (see sidebar).

If you’re not using a cloud-based solution, you need a system to back up all your files. It’s fine to store one copy securely in the office, but it’s imperative to have a second copy offsite.

You might put everything on a thumb drive every night and take it home, but you’d better be sure you have a safe for it. Then again, if a major disaster strikes, your home could be in danger, too, which makes a bank safe-deposit box or a secure location out of town even more secure for physical hard copies of data.

Know What Matters Most

Backups of your client data – including all their contact information – are a must-have. But also back up copies of personnel files, so you can contact your employees in an emergency and continue functions like payroll even if you have to work offsite for a while.

Don’t forget about other documents like business licenses or other legal paperwork. Especially if other buildings in your area are shut down, accessing them may not be easy.

There are other practical considerations, too. Do you have a generator to charge cell phones and laptops if the power is out? Where can you work from remotely if your office is shut down? How can you quickly rebuild your office or relocate if the physical premises are destroyed?

Consider the human component. In an emergency, people’s safety is the first priority. Have clear evacuation plans in place and practice them. Also think about the emotional toll a major disaster might have on your employees and how you might assist them in the aftermath.

It’s a good idea to sit down with your staff, think through every possible scenario that could interrupt your business, and write down a plan so you’re ready to respond. Store a copy of this offsite, too.

“Your employees are a huge asset you can task to help the business recover,” adds Boyle. “Because if they’re in it together they’ll want to find ways to overcome the mutual challenges you’re facing.”

The Federal Emergency Management Agency (FEMA) has a website, ready.gov/business, that walks you through the steps of creating a plan with your team.