Crisis? What crisis?

Written by Allan Britnell

When the power went out at 4:11 p.m. on August 14, 2003, the folks at Ottawa-based Magma Communications Ltd. didn’t panic. The Internet service provider’s diesel generators automatically kicked in and, aside from routine systems checks, it was business as usual. After they realized the situation could become long-term, staff were reallocated where needed, calls were made see how they could assist powerless clients and an order was placed to replenish the two-day supply of generator fuel. “The blackout wasn’t a disaster for us,” says Ron Ethier, Magma’s vice-president of technology. “It was more of hands-on test of our emergency plan. When the lights went out, our biggest question was: ‘How can we help our customers?'” When the local power grid sparked back to life 12 hours later, Magma’s crisis response plan proved it had been up to the challenge.

In recent months, SARS landed in Toronto, forest fires raged in B.C. and the lights went out across much of Ontario. After so many direct hits and near misses, CEOs are realizing: “It could happen to me.” That’s why you need to think about potential threats to your business beforehand, assess their likelihood and develop a disaster plan. Here, PROFIT provides 10 steps to help your company survive the next crisis.

  1. Paper trails: Create a hard-copy contact list of your employees, key clients and suppliers. The list should have all their contact phone numbers, home and e-mail addresses and, most important, must be updated every few weeks. “We recommend our clients carry a hard copy of the key executive fan-out procedure in their wallets or DayTimers,” says Jim Stanton, an Ottawa-based crisis-management and communications consultant. With a proper fan-out, no one is responsible for contacting more than four or five people; that is, the CEO calls five designated people on the master contact list, they each call five people, and so on until everyone on the master list has been contacted and accounted for. This way all the key players keep in touch with each other.
  2. Keep it simple: The scope of your crisis management team(s) depends on the size and complexity of your business. A 10-person machine shop won’t need a full-time crisis manager, but it will need a coordinator and a backup person. Designate teams and their responsibilities before they’re needed.
  3. Evacuation plan: “Having an evacuation plan is the first thing I talk to my clients about,” says Graeme Jannaway, a Toronto-based crisis consultant and president of the Disaster Recovery Institute of Canada. “It indicates that you care about your employees.” It could also save their lives. Run regular drills, nominate floor / area wardens, and make sure everyone knows where to gather after they leave the facility.
  4. Supply lines: “There’s no excuse for not having rudimentary supplies in the workplace so you can live for a couple of days,” says Toronto-based risk- and crisis-management consultant Allan Bonner. These include a regularly restocked first-aid kit, flashlights, water and non-perishable food. You can also stock up on toiletries such as toothbrushes to make your staff more comfortable.
  5. Back up: Many companies bought generators in anticipation of Y2K. Unfortunately, a lot of them have been neglected since. Generators need maintenance and regular testing under load to ensure they’ll kick in when the grid kicks out. “Most people fire them up once a month to make sure they’re running,” says Michael Smith, a principal and risk-management consultant with Ernst & Young. “What they don’t do is run it under load for a period of time.” They also tend to rely too heavily on emergency battery backups — so-called “uninterruptible power supply” (UPS) systems. Such systems can only keep computer networks running for about 30 minutes. That’s more than enough time to avoid data loss or corruption and to enact proper shutdown procedures — but not enough time to keep working.
  6. Out of site: The most important component of a business continuity plan is off-site storage of essential data. Think of the key materials you need to keep your company running (e.g., trade secrets, client lists, accounts payable records) and make sure you have duplicates somewhere off-site. This doesn’t mean you need to build a bunker. “For small companies, there’s no reason why the boss can’t take the backup tapes home,” points out Jannaway. If you do lose important data before initiating off-site storage, you may be able to take advantage of duplicates already held by clients and suppliers.
  7. The information loop: Establish a hotline that staff can call for updates on a given situation and to learn when and where they’re needed. It’s amazing how far a little information will go toward dispelling any sense of chaos among your staff (see note). If they’re not kept informed, they may begin to feel that the future of your company is uncertain and end up jumping ship when you need them the most.
  8. Fallback workspace: A disaster such as fire or flood can unexpectedly shut you out of your workplace. Before calamity calls, establish backup worksites. This could be as simple as asking staff to work from home or holding meetings in the president’s living room. Assembly operations and warehousing could be set up in local community centres or even shipping containers. You should also talk to your suppliers beforehand. They have a vested in keeping you afloat and should be willing to accommodate you.
  9. Shipping news: So you’ve managed to improvise an assembly line. But how do you get the goods out to clients? Move those boxes by thinking outside of one. If air or rail lines are down, can you ship by truck or bus? Get non-essential employees to deliver to shipping hubs or directly to customers. Again, suppliers and clients may be a valuable resource.
  10. Remedial media: Crisis management sometimes requires a public statement. Designate and train a spokesperson — and a backup — to field media questions. Remember that being honest is better than getting caught fudging unknown facts. “The answers to most of the questions you’ll be asked in a crisis are, ‘I don’t know’,” says Bonner. “Stick to only what you know for sure.”

How to bear bad news

When disaster strikes, apprising staff of the situation is critical to maintaining their trust and composure. Here are some crisis communications tips from Captstone Communications in Chico, Calif.:

  • Identify a spokesperson
  • Be factual
  • Tell all the bad news at once
  • Emphasize the positive
  • Don’t avoid the media or employees
  • Don’t lose your cool
  • Issue press releases at the same time as employee announcements

© 2003 Allan Britnell

Originally appeared on PROFITguide.com