How Disaster Recovery Plans Work

Partners and Outside Help

To practice your plan, hold a disaster drill like this earthquake evacuation drill staged in Mexico City.
To practice your plan, hold a disaster drill like this earthquake evacuation drill staged in Mexico City.
Ronaldo Schemidt/AFP/Getty Images

A company is both a vendor and a client to dozens if not hundreds of other companies. What happens in the event of a disaster? What are your vendors' obligations to you? What are your obligations to your clients and partners?

Company attorneys draw up a Service Level Agreement (SLC). According to The Business Continuity Institute, an SLC is a binding agreement between two companies, or between suppliers within the same company, that covers the "nature, quality, availability and scope of the service provider." Within the SLC are special provisions related to emergencies, so that one side can be legally liable if it fails to deliver an essential service, even in time of crisis.

We've already talked a little about third-party disaster management services. We've mentioned that they can assist with the interviewing and research process to make sure the disaster recovery plan is thorough. We've also mentioned that they can provide alternative workspaces in the event of an emergency and can host and store data off-site.

But perhaps the most useful service of a disaster management company is regular testing and auditing of the disaster recovery plan. A disaster recovery plan won't do any good if it's five years old and collecting dust in the CEO's drawer. Frequent testing for multiple contingencies ensures that a disaster recovery plan works. It's equally important to diligently audit and update the contact lists of employees and vendors. A company should maintain detailed records of its hardware, software and network equipment.

Creating and updating a comprehensive disaster recovery plan is not a simple task. It's not cheap either. Surprisingly, a number of companies create incomplete plans or ignore them. According to a survey done by the Association for Financial Professions months after Hurricane Katrina, only 24 percent of respondents said that their companies had recently tested their disaster recovery plans. A full 50 percent admitted they had no intention of testing their plan.

To find out more about disaster recovery plans and how you can safeguard your business against unforeseen events, check out the helpful links below.

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