Disaster Recovery: What CFOs Must Know

In an urbanised, industrialised world, it’s easy to think that man controls the working environment. Flick a switch and your office gets cooler. Flick another and the information you need is at your fingertips.
But then the unexpected happens. Earthquakes. Volcanic ash blocking the airspace. H1N1. Such events remind us that economic cycles are not the only cause of uncertainty in business. 
When such disasters occur, many organisations find out – too late – that their business continuity planning was not up to the mark. So how can you make sure that your own business could continue to function during or after a crisis?
Plan before, not during, a disaster. The results of neglecting disaster recovery planning can be dire. Faced with a major incident such as fire, floods, crime, terrorism or IT failure, a high proportion of businesses never re-open, or eventually close within two years, according to studies by insurance giant AXA.
Even much smaller events can destabilise a business. In Regus’s experience, one of the most common scenarios requiring our customers to activate a workplace recovery plan is a problem relating to utilities. A power failure, for example, or a burst water pipe in the offices upstairs can render your workplace unusable for days.
If you don’t have rapid access to alternative workspace and business facilities, the consequences can include loss of business and customers; loss of goodwill and reputation; loss of production; loss of data; and cash flow problems.
Moreover, the consequences can last much longer than the original problem. The reputational stain of cancelled meetings, unmanned phones, lost data, or chaotic admin systems can linger for months or years.
Plan properly, and formalise your plans. According to Ernst and Young, 34% of companies cite ‘workplace recovery’ as their greatest technical challenge in creating a business plan. As a result, many of them procrastinate.
But even if disaster doesn’t strike, the lack of a robust disaster recovery plan can harm a business. Increasingly, the tender procedures of large companies require suppliers to give details of their business continuity planning. An inadequate plan can cause you to fall at the first hurdle. Lack of planning can also elicit disapproval from audit committees and regulators, especially in the financial services industry.

Think about the space you need. A common solution in business continuity planning is to use ‘hot sites’, particularly to ensure continued access to business-critical information systems. But this may not cover the overall issue of where all your staff would go to work.
At one end of the scale, you may not need a hot site – just access to desks or meeting rooms. At the other end of the scale, an organisation with a wide or global footprint needs to replicate that footprint in its planning. You need access at short notice to suitable workspace all over the world – even as many businesses in the same area are scrambling for emergency space.
This space should be near where your staff work and live. At a time of crisis, a business should not sap staff morale further by making people travel long distances to a replacement workspace.
Look for quality and capability. Equally important in workplace recovery planning is to find space of a consistently high standard. Your back-up space and facilities should be of the same high quality, whether they’re in London, Tokyo, Manila or hundreds of other locations.
The capability to manage logistics is also critical. Using a provider that gets people quickly and efficiently into and out of its space week in, week out offers reassurance on this point. If a company’s bread-and-butter is providing fast access to fully-equipped, fully-furnished workspaces and business support, it is well qualified to do the same in a workplace emergency.
Be flexible. Another way to simplify workplace recovery is to change the way you use space. With a mobile, flexible workforce, involving staff working at different locations close to their homes or the customers, there is less reliance on centralised locations. With less reliance comes less vulnerability.
With a flexible or mobile workforce, workers no longer have to work in large traditional offices in crowded city centres. Instead, they can use a laptop to work anywhere – at home, in drop-in workspaces, or anywhere else with high-speed internet access. If one of your locations is put out of action by fire, flood, terrorism or another crisis, many workers will be unaffected and can carry on as usual.
Flexible and mobile working has other major benefits too, such as the potential to reduce real-estate costs by up to 60%; and the potential to create a more motivated and productive workforce.
Be green. Traditional working patterns and traditional business continuity solutions often involve long commutes for employees. But a lengthy journey to a centralised office – or back-up office – does not make environmental sense when people can work flexibly closer to home.
Even less green are the continuity plans that envision employees commuting to a central pick-up spot, and then bussed to a back-up location elsewhere. Such scenarios are bad for employee morale, bad for productivity, and bad for the environment.

Flexible and mobile working - where employees use internet and wireless technology to work across convenient locations closer to home - renders those long commutes unnecessary. It therefore reduces the company’s environmental impact; reduces its vulnerability to site-specific emergencies; and can reduce real-estate costs as well.
As we see it, any solution that addresses three of the great business challenges of the twenty-first century – sustainability, costs and business continuity planning as well - has to be worth considering.
About the author
Mark Dixon is CEO of Regus Group plc, a provider of workplace solutions that operates more than 1,000 business centres across 450 cities in 75 countries.

Suggested Articles

Some of you might have already been aware of the news that Questex—with the aim to focus on event business—will shut down permanently all media brands in Asia…

Some advice for transitioning into an advisory role

Global risks are intensifying but the collective will to tackle them appears to be lacking. Check out this report for areas of concern