HOW TO DEVELOP A COMPANY DISASTER RECOVERY PLAN<br />(aka: Planning to Survive)<br />Jennifer H. Elder, CPA, CMA, CFF<br /...
Charlie: August 9 – 15, 2004<br />Cat 4<br />Jeanne: September 25, 2004  Cat 3<br />Phone System: August 2007<br />Frances...
OBJECTIVES<br /><ul><li>Why do you need to plan?
What do you need to plan for?
How do you create a plan?</li></ul>Copyright Jennifer Elder, CPA  October 27, 2008<br />
WHAT DO YOU KNOW ABOUT DISASTERS?<br />DISASTER <br />TRIVIA!!!<br />Copyright Jennifer Elder, CPA  October 27, 2008<br />
TYPES OF DISASTERS<br /><ul><li>Natural - flood, snow, hurricane, lightning
Health – swine flu
Accidents – fire, explosion, equip failure
Terrorism - ????
IT - cyber attack, equipment malfunction
Workplace Violence - shootings
Contamination - chemical, biological
Loss of key personnel – sudden death
Sabotage – product poisoning
Utility Interruption – loss of power, phone
Scientific Discoveries – health issues</li></ul>Copyright Jennifer Elder, CPA  October 27, 2008<br />
WHAT IS A DISASTER?<br />“An unplanned interruption of normal business function or process for an unacceptable period of t...
RATE OF DISASTERS<br />By what % has the natural disaster rate increased <br />	over last 15 years?<br />40%<br />Copyrigh...
IMPACT ON BUSINESS?<br />How long can you operate your business without access to critical data before suffering permanent...
IMPACT ON BUSINESS?<br />According to the IRS what % of businesses   never reopen  after disaster<br />35% <br />Copyright...
IMPACT OF FIRE<br />What % of businesses close within 	  six months 	  of fire<br />75%<br />Copyright Jennifer Elder, CPA...
HOWMANY PLAN ?<br />2005 Ad Council Survey<br />92%said planning was important<br />What % actually had a plan?       <br ...
IMPACT OF PLANNING<br />Every $1 spent on preparedness<br />	saves how many $ of economic loss<br />$7<br />Copyright Jenn...
RECOVERY TIMING?<br />When does disaster recovery begin?<br />Before the disaster!<br />Copyright Jennifer Elder, CPA  Oct...
HOW DOES DISASTER AFFECT A BUSINESS?<br /><ul><li>Loss of sales/customers
Loss of cash flow
Loss of vendors/increased materials cost
Decrease in productivity/loss of employees
Damage to reputation</li></ul>Copyright Jennifer Elder, CPA  October 27, 2008<br />
SO WHY DO YOU NEED A PLAN?<br /><ul><li>likely to happen to you
planning will keep you in business
planning will save you money
prevents chaos
NEW BILLABLE SERVICE!!!</li></ul>Copyright Jennifer Elder, CPA  October 27, 2008<br />
WHAT DO YOU NEED TO CONSIDER?<br /><ul><li>operations critical to survival
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Why and how to develop a company disaster recovery plan

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  • Do you want people to scatter or do you want employees centrally locatedGenerator & fuelEmergency Records – who do you need to contact?Communication – walkie/talkie phones
  • How To Develop A Company Disaster Plan

    1. 1. HOW TO DEVELOP A COMPANY DISASTER RECOVERY PLAN<br />(aka: Planning to Survive)<br />Jennifer H. Elder, CPA, CMA, CFF<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    2. 2. Charlie: August 9 – 15, 2004<br />Cat 4<br />Jeanne: September 25, 2004 Cat 3<br />Phone System: August 2007<br />Frances: September 4 -5, 2004<br />Cat 4<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    3. 3. OBJECTIVES<br /><ul><li>Why do you need to plan?
    4. 4. What do you need to plan for?
    5. 5. How do you create a plan?</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    6. 6. WHAT DO YOU KNOW ABOUT DISASTERS?<br />DISASTER <br />TRIVIA!!!<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    7. 7. TYPES OF DISASTERS<br /><ul><li>Natural - flood, snow, hurricane, lightning
    8. 8. Health – swine flu
    9. 9. Accidents – fire, explosion, equip failure
    10. 10. Terrorism - ????
    11. 11. IT - cyber attack, equipment malfunction
    12. 12. Workplace Violence - shootings
    13. 13. Contamination - chemical, biological
    14. 14. Loss of key personnel – sudden death
    15. 15. Sabotage – product poisoning
    16. 16. Utility Interruption – loss of power, phone
    17. 17. Scientific Discoveries – health issues</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    18. 18. WHAT IS A DISASTER?<br />“An unplanned interruption of normal business function or process for an unacceptable period of time”<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    19. 19. RATE OF DISASTERS<br />By what % has the natural disaster rate increased <br /> over last 15 years?<br />40%<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    20. 20. IMPACT ON BUSINESS?<br />How long can you operate your business without access to critical data before suffering permanent damage?<br />48 – 72 hrs<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    21. 21. IMPACT ON BUSINESS?<br />According to the IRS what % of businesses never reopen after disaster<br />35% <br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    22. 22. IMPACT OF FIRE<br />What % of businesses close within six months of fire<br />75%<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    23. 23. HOWMANY PLAN ?<br />2005 Ad Council Survey<br />92%said planning was important<br />What % actually had a plan? <br />39%<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    24. 24. IMPACT OF PLANNING<br />Every $1 spent on preparedness<br /> saves how many $ of economic loss<br />$7<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    25. 25. RECOVERY TIMING?<br />When does disaster recovery begin?<br />Before the disaster!<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    26. 26. HOW DOES DISASTER AFFECT A BUSINESS?<br /><ul><li>Loss of sales/customers
    27. 27. Loss of cash flow
    28. 28. Loss of vendors/increased materials cost
    29. 29. Decrease in productivity/loss of employees
    30. 30. Damage to reputation</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    31. 31. SO WHY DO YOU NEED A PLAN?<br /><ul><li>likely to happen to you
    32. 32. planning will keep you in business
    33. 33. planning will save you money
    34. 34. prevents chaos
    35. 35. NEW BILLABLE SERVICE!!!</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    36. 36. WHAT DO YOU NEED TO CONSIDER?<br /><ul><li>operations critical to survival
    37. 37. communications
    38. 38. business records – old & new
    39. 39. out of pocket costs/insurance
    40. 40. employees</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    41. 41. HOW DO YOU BEGIN?<br /><ul><li>Create a Disaster Recovery Planning Team
    42. 42. Consider Likely Disasters
    43. 43. Create an Emergency Plan
    44. 44. Create a Continuity Plan</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    45. 45. DISASTER RECOVERY PLANNING TEAM<br /><ul><li>all departments
    46. 46. all levels
    47. 47. key suppliers
    48. 48. key customers
    49. 49. local Gov’t, Red Cross</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    50. 50. CONSIDER LIKELY DISASTERS<br /><ul><li>Which disasters could affect you?
    51. 51. What would be the extent of the impact (in dollars)?
    52. 52. What is the likelihood of each potential threat occurring (%)?
    53. 53. Rank your threats – R = P% x I$
    54. 54. Address the riskiest first</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    55. 55. RANKING DISASTERSby Risk or by Impact???<br /><ul><li>50% Cyber attack </li></ul> Impact $10k<br /><ul><li>30% Hurricane</li></ul> Impact $50k<br /><ul><li>10% Fire </li></ul> Impact $250k<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    56. 56. RANKING DISASTERS<br /><ul><li>Cyber attack </li></ul> P 50% X I$10k = $5k<br /><ul><li>Hurricane</li></ul> P 30% X I $50k = $15k<br /><ul><li>Fire </li></ul> P 10% X I $250k = $25k<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    57. 57. EMERGENCY RESPONSE PLAN<br /><ul><li>what to do when disaster strikes or is about to strike
    58. 58. immediate responses to mitigate potential & actual impact
    59. 59. protection – P.D.A.</li></ul> People – Data - Assets<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    60. 60. EMERGENCY RESPONSE PLAN<br /><ul><li>Where will you go? </li></ul>shelter<br /><ul><li>How will you get there? </li></ul>evacuation<br /><ul><li>What will you need?</li></ul>emergency supplies<br /><ul><li>How do you protect your assets?</li></ul>mitigate damage<br /><ul><li>How will you stay in touch?</li></ul>emergency records/contacts/communication<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    61. 61. CONTINUITY PLAN<br />PLAN TO STAY IN BUSINESS<br /><ul><li>Where else can you work from?</li></ul>alternative physical locations<br /><ul><li>How will you get work done?</li></ul>alternative computer systems<br /> hardware/applications/data<br /><ul><li>Who needs to be back at work?</li></ul>essential personnel, how will they get back to work<br /><ul><li>What do you need to keep working?</li></ul>equipment- rent/replace/repair<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    62. 62. CONTINUITY PLAN<br /><ul><li>Who will you provide your materials?</li></ul>alternate suppliers<br /><ul><li>How will you pay your bills?</li></ul>cash flow<br /><ul><li>How will you keep track of transactions?</li></ul>recordkeeping<br /><ul><li>How will you pay your staff?</li></ul>payroll<br /><ul><li>How will you handle the insurance claim?</li></ul>agent or private adjuster<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    63. 63. CONTINUITY PLAN<br />Once you have a plan:<br /><ul><li>test your plan
    64. 64. update every 6 months:</li></ul> responsible employees, contact names & numbers, copies of critical documents<br /><ul><li>rehearse the plan
    65. 65. keep copy of plan off-site & readily accessible to all</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    66. 66. REVIEW<br /><ul><li>Why plan?
    67. 67. Rate of disasters increasing
    68. 68. Can take as little as 48 hrs to damage your business
    69. 69. 35% businesses fail after disaster
    70. 70. 75 % fail after fire
    71. 71. Every $1 spent on planning saves $7 in loss
    72. 72. NEW BILLABLE SERVICE!!!!</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    73. 73. FINAL ADVICE<br />Best way to prepare for disasters is to AVOID them in the first place!<br />Failure to plan is planning to fail!<br />Copyright Jennifer Elder, CPA October 27, 2008<br />
    74. 74. DISASTER RECOVERY RESOURCES<br /><ul><li>ready.gov
    75. 75. floridadisaster.org
    76. 76. fema.gov
    77. 77. ibhs.org (Institute for Business & Home Safety)
    78. 78. sba.gov
    79. 79. disastersafety.org
    80. 80. redcross.org
    81. 81. mema.state.md.us (Maryland Emergency Management Agency)
    82. 82. mdinsurance.state.md.us (Maryland Insurance Administration)
    83. 83. choosemaryland.org (Maryland Dept of Business & Economic Development)</li></ul>Copyright Jennifer Elder, CPA October 27, 2008<br />
    84. 84. Copyright Jennifer Elder, CPA October 27, 2008<br />
    85. 85. Copyright Jennifer Elder, CPA October 27, 2008<br />
    86. 86. Copyright Jennifer Elder, CPA October 27, 2008<br />
    87. 87. Copyright Jennifer Elder, CPA October 27, 2008<br />
    88. 88. Copyright Jennifer Elder, CPA October 27, 2008<br />
    89. 89. Copyright Jennifer Elder, CPA October 27, 2008<br />
    90. 90. Copyright Jennifer Elder, CPA October 27, 2008<br />

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