Disaster Recovery – A Time Line
Among many daily tasks, both customer related and administrative, businesses need to remember to keep an eye toward preparation for the unforeseen. Risk identification and management for the ordinary and the extraordinary are essential to long-term business viability. Disaster planning and recovery have become more frequently the focus of attention, starting with Y2K issues.The primary issues of Y2K involved the reliability of community public safety including electrical power, communications, traffic controls, and other infrastructure issues, which were international in scope.And then the September 11, 2001, World Trade Center tragedy struck the nation. All US businesses turned their attention to disaster planning, where I noted that “The World Trade Center tragedy may not have changed our business risks, but, demonstrated that we are largely unprepared.”Last year’s Hurricane Katrina taught us a lot about our aging infrastructure, the power of wind and water, and the crushing task of mass evacuation.Today we look at areas important to risk management teams as the globe (and the US particularly) prepare for the possibility of a pandemic (see related article).Insurance has always been a housekeeping task, while risk management is an ongoing necessity. First you identify the risk, and then you decide what to do with it.My opinion of your greatest risk of loss?• Liability while driving your car• Employees’ health and viability• Loss of a key person to the business• Fire [property & income losses]• Data security breaches• Employee theft• Flood and Hurricane (please note my October 2005newsletter, “The Ugly Truth About Flood Insurance”)Insurance industry experts and predictor specialists state that a hurricane the severity of 1938 with 150 m/p/h winds may hit the east coast as early as this year. Astonishingly, 53 percent of Americans currently live in coastal communities – the insurance industry does not possess the financial strength to handle that magnitude of loss. Remember, World Trade Center losses are between $40-$50 billion, and Hurricane Katrina costs currently at $60 billion.My work with liability and legal issues associated with Y2K began in 1996. At the time it was estimated to be a $600 billion global remediation project with the American Bar Association estimating $1 trillion in litigation costs– worthy of some examination. In my opinion it was the greatest global remediation effort ever successfully undertaken. For this past 10 years those issues have not only compounded, but also grown as a management concern.The most important thing today for businesses to remember is an eye toward preparation – risk identification and management. Sit down and assess your risks for ultimate business continuity and viability.Newsletter, November 2006
