Were you affected when Xero’s system went down recently? Have you been affected by other major disruptions at work? If so, were you prepared or did everything just grind to a halt?
What situations like this is highlight what can happen when our daily work routine gets disturbed. What if something like this happened in your workplace:
· A key staff member quit on the spot?
· The building lost power?
· A supplier couldn’t deliver on time?
· There was an onsite accident or local emergency?
Does your workplace have adequate contingency plans in place?
We would hope that you do have financial Plan B’s ready to go at all times. (If not, maybe you are in the wrong industry?) You can also see the business.gov.au website for tips on preparing an emergency action plan https://www.business.gov.au/info/run/emergency-management/develop-your-emergency-action-plan. But what about Plan B’s for your daily workflow activities?
The goals of a business contingency plan
Each business contingency plan should achieve 3 main objectives:
1. To allow the business to function effectively until such time as Plan A can be restored.
2. To ensure that clients can continue to access or purchase goods and services as soon as possible.
3. To allow day-to-day activities to flow with minimal interruption or interference.
Risk factors to consider
It’s important to have clear and simple contingency plans for the main risk factors that could disrupt your business. Here are some key areas to consider:
· Equipment failure
· Physical environment issues
· Supply and delivery chain problems
· Personnel issues
· Industrial actions
· Infrastructure issues in your area
· Website and social media issues (yours and others)
· Legal threats
Tips for setting up your business contingency plans
· Creating the contingency plans - Who is responsible for developing your contingency plans? How much time will they be allocated to do so? What resources can they access? What types of risk factors will be considered and how detailed will the plans be?
· Continuance of operations – What does each department or staff member need in order to deliver basic services effectively? What needs to happen immediately? What about during the first day or first week? Will the business need to function at a reduced capacity? What level is considered acceptable?
· Initiating the plans – What kind of scenario will trigger the initiation of each plan? Who will be responsible for the plan’s execution? How will all internal and external stakeholders be notified and updated?
· Monitoring the plans – Who will be responsible for ensuring the plans are upheld and reported on? At what point will they be ceased? What happens next?
You also need to ensure that each staff member is trained on where and how to find these plans at any time (we suggest they go into your procedures manual).
The best contingency plan is one you never have to use. It’s important for all employees and other stakeholders to look for ways to minimise risk in the first place and to know what to do about it. Also check that your insurance cover is up to date and weigh up whether it needs to include all the risk factors you have identified.
In the event that something does happen to disrupt your business, be flexible, stay calm and try not to ‘sweat the small stuff’. We can’t control everything all the time and sometimes the things we get worked up about aren’t that important in the long run. Maintain your perspective and you will get through it all.
Call to action
In Episode 50 of their From The Trenches podcast series What To Do When Your Technology Fails, Paul Meissner and David Boyer gave their suggestions for the many things you can do on the days when you simply cannot do your normal daily activities. There are always plenty of other productive things you can do, such as talk to each other!
Paul & David are passionate CA's who care deeply about the accounting industry.
Paul quit his accounting day job seven years ago and now owns and runs the Melbourne-based firm, 5ways Group Chartered Accountants, and his online Freedom Accounting System firm which allows him to travel and work from anywhere.
For the last 4 years, David has worked as a Virtual CFO. At the start of 2016 he co-founded the Virtual CFO Association and in December 2016 his company, Sequel VCFO began franchising to mobilise the experienced work force of accountants in industry and bring their expertise to SMEs.
Together with their impressive list of guest presenters, Paul and David are the brave souls needed to fight through the noise and give accountants in practice the support and information they deserve.
Click here now to listen to the From the Trenches podcasts, learn about their upcoming events or subscribe to their automatic updates.
If you like what you hear, be sure to subscribe and leave a review and rating.