Prepare yourself and your company for the unexpected with a business continuity plan (BCP): a systematic plan on paper for how your company will react, operate and recover when business as usual is interrupted. It gives you a backup plan for different situations, outlining the bare minimum that’s necessary to operate your business.
To begin, think about what’s critical for your business’ survival and how you’ll get back on track after a crisis. Answer these questions:
- What will you need to do if you have to shut down your business for days, weeks or months?
- How will your business be affected?
- Do you have a reliable way to communicate with staff and other key people outside of business hours during an emergency?
- Do you have a communication plan to inform customers of interruptions?
- Can you still stay open even if products don't arrive from vendors and suppliers?
Why a BCP is necessary
A BCP is likely one of the last things on your mind as a new business owner, but it shows everyone—employees, shareholders and customers—that your company is proactive and productive in an emergency. It improves efficiency, decreases disruptions, lowers losses and allocates resources—all things that can be hard to do in the moment without a plan in place.
An interruption in business could mean sales loss or delay, more expenses, fines and unhappy customers, among other issues.
Think of how the COVID-19 pandemic affected all businesses. Instead of focusing on growth, companies had to swiftly adapt to a virtual and physically distanced world and closures of non-essential businesses. Also think about how businesses had to recover after natural disasters such as the 2013 Alberta floods or 2016 Fort McMurray wildfires.
Create your BCP
Here is a step-by-step guide to creating your BCP:
Complete a business impact analysis
Identify your business’ essential functions (what is absolutely needed to keep the business running and doors open) and the number of necessary employees. Gauge the impact of disruptions by creating a ranked list of importance of each function.
Conduct a data-based risk assessment
Identify all threats to your business operations and analyze the likelihood of them happening. This allows you to understand how to prioritize their management.
Potential emergencies include:
- employee absence
- system or power outage
- cybersecurity breach
- building damage or broken equipment
- public health emergency
- natural disasters
- low air quality
- supply chain issues
- workplace violence
Create a plan and team for each business function
Prepare a plan for each specific function, featuring a description, the people responsible for putting the plan into action and their backups, the resources your business will need and a disaster recovery plan. Make a list of important contacts (like employees, customers and suppliers). Create an emergency team to plan procedures and communications so each member knows their role when an emergency situation arises. Who is responsible for enacting the business continuity plan? Who is the key decision maker in case of emergency?
Procedures could include building an internal and external communication plan, training employees on essential tasks, keeping up-to-date employee contact information and finding alternative locations.
For example, can employees easily adapt and work from home if there is a health emergency or building problem? Ensure you have the right equipment at the ready. What will happen if you have to change, reduce, suspend or relocate your services? How will you coordinate with external groups?
Document all procedures
Get everything in writing so all employees know their role and the steps to take during an emergency. Do you have a BCP checklist (a list of what actions need to be taken in case of emergencies) and employee handbook containing policies for different scenarios? Equip your employees with instructions and training on when and how to use the BCP.
Test and continuously re-evaluate
Think of the fire drills and lockdowns of grade school. Doing a trial run of the procedure in case of dire circumstances ensures students know what to do during the real thing. It’s the same with yourself and your employees.
Test all of your emergency procedures regularly to figure out what works and change what doesn’t. What is an efficient use of your resources?
Are you regularly backing up data? Is someone who no longer works for you still the main person responsible for implementing the BCP or speaking to the media on the contact list? Are all your employees confident about what to do in case of an emergency? If not, it’s a good idea to review and ensure all plans are up to date and that everyone has the same understanding.
Financially planning for emergencies
Figure out your emergency budget, re-evaluate your BCP regularly and ask for feedback from the people involved.
Small businesses continue to struggle post-pandemic, impacted by more debt, higher interest rates, labour shortages and inflation. About 11 per cent of Albertan small businesses plan to scale down or permanently close in the next year, according to a November 2023 survey from the Canadian Federation of Independent Business.
That number was 14 per cent in the January 2023 CFIB survey.
A CFIB survey from November 2022 revealed 24 per cent of Alberta businesses were at risk of closure—the highest percentage in Canada at the time.
Falling oil prices compounded the effects of the pandemic on Alberta’s small businesses in 2020—making the province the hardest hit in Canada in 2020.
With these overlapping crises in mind, it’s best to prepare for anything.
Next up, learn how to purchase and manage your business’ inventory.