August 22, 2011 | last updated June 1, 2012 10:37 am

Business continuity plan is a tool worth stocking

Greg Even

Myth: In the event of an accident or disaster, small business employees are well positioned to keep operations running smoothly while a business owner is away.

Fact: Developing a business continuity plan and sharing it with employees can prepare them to properly navigate most emergency situations while the business owner is out of the office.

As the summer winds down, many small business owners will do what they can to squeeze in last-minute vacations. As such, owners may temporarily turn over the management of their operations to trusted staff members with the hope that business will carry on as usual for the week or two they are away.

Assuming the team is "on board" and capable of handling emergency procedures without guidance, however, can lead to dangerous results if an emergency does occur.

It is important that small business owners trust the people they employ, but without proper direction, employees might not know how to handle an emergency situation. Business owners operating with a well-developed and communicated business continuity plan are in a better position to enjoy their vacations with less worry about the impact that an emergency will have on their business.

A business continuity plan provides a set of actionable guidelines that steer a business through the recovery process and get operations back to normal after a disaster. Without a business continuity plan, employees will be left to make a judgment call, which could unintentionally harm the business.

Despite the importance of proper planning, a survey conducted by Travelers Small Commercial, the small business unit of one of the nation's largest property and casualty insurers, found that almost half (44 percent) of small businesses are operating without any type of business continuity plan. The study, which was conducted at the U.S. Chamber of Commerce's America's Small Business Summit, also found that 56 percent of owners spent less than 10 percent of their time identifying and preventing operational risks.

Emergencies can range from weather-related incidents like a flood or a tornado to equipment issues like a boiler failing or a fire, and there is no way to predict exactly how the business will be affected. Owners need to prepare themselves and their employees to best navigate these issues should they arise. Building and communicating a business continuity plan provides small business employees with resources to tackle unforeseen situations which may arise while the boss is away.

These plans can provide the necessary roadmap to handle a crisis, but they are only impactful when communicated effectively and frequently with employees. Once a business continuity plan is developed, owners should walk their employees through different scenarios that can significantly impact a business and explain how to manage the circumstances. The plan can include everything from important phone numbers of service providers to locations of back-up data. Every plan should also consider including the best way to contact the owner in the event of an emergency, and should be updated to reflect where he or she will be while away.

The study also found that only 10 percent of owners tap into their independent insurance agents for advice and guidance on developing a business continuity plan, despite agents' experience in risk management. Further, the most utilized resource for such advice is the business owner's attorney, with 28 percent of respondents relying most on their lawyer for risk management advice.

Small business owners should have a strong grasp on who (and what) their best resources are. Learning from peers can be extremely valuable, but professionals who specialize in managing risk can help small business owners plan for the unexpected. Independent insurance agents are trained to identify and mitigate exposure to risk, making them ideal partners in developing a continuity plan in the event of a business emergency.

Small business owners deserve to travel and vacation without stressing over potential business emergencies. Working with an insurance agent to develop a business continuity plan is one of the best things a small business owner can do to help employees manage a disaster or accident. If an emergency occurs, employees will have a written set of guidelines helping them to act quickly and confidently to minimize potential damage done to the business and alert proper authorities and important parties.

Greg Even is regional vice president, Northeast, for the small business division of Travelers. For more information go to

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