3 Crucial Steps to Create a Foolproof Contingency Plan

It’s 3 o’clock on a typical Wednesday at work. Your employees are quietly bustling through their tasks, organizing files to be discussed at the next meeting, when a frantic coworker comes racing into the room. Scrambling to collect his things, he shouts to you, “The utility closet is on fire! What do we do?” firetruck in front of yellow buildingThe most common emergencies a business will experience involves power outages and human error. Whether a fire breaks out in the lobby or your company suddenly has to fill their largest order to date, a contingency plan is designed so that you can recover quickly from the unexpected.

How Do I Create A Contingency Plan For My Business?

Step One: Identify Risks.

If your sales could flat line the day after Black Friday or a technical glitch could leave your company without a database, you’re going to want to identify these risks ahead of time. Sit down with your management team and list all possible events that could disrupt your business. Give your list a ranking based on each event’s detrimental effects to your business, as well as the odds of the events occurring. Remember, even the less likely events should be planned for, as they may pose the most risk to unsuspecting business owners.

Step Two: Plan a Sequence for Each Event.

Just as you would write a story —with a beginning, middle, and end–you will want to write your contingency plan with detailed instruction of preparation before, during, and after the event. Should your small store be robbed and damaged, for example, some of the following questions could prove useful in your recovery:

  1. Were there signs of this disaster occurring before it took place?
  2. In disaster recovery: what emergency contacts should I call?
  3. Who do I communicate to about the disaster?
  4. For the sake of business continuity, how do I assess the disaster while encouraging that my business is still operational?
  5. What is the timeline to recover from this disaster?

my contingency plan written in a notebookStep Three: Maintain the Plan.

Have your plan accessible to your whole staff. Keep it organized, concise, and available in both print and online. Moreover, ensure the contingency plan is available onsite and offsite so it can be accessed from any location. With many companies and large organizations, contingency planning involves regular comprehensive staff training. This ensures that every employee feels safe and comfortable in these disruptive moments.  The staff should know their role and what to do to help support the business and their own safety.

Expecting the Unexpected

Accidents happen, but a business with a good contingency plan will be better prepared for the unexpected. Additionally, you’ll be in a better position to take control of the situation calmly and effectively.

When we define contingency planning, we don’t just plan for the unexpected—we begin to expect the unexpected. Disasters can blur our decision-making abilities and our steady reaction to them could make all the difference between reaching revenue for the quarter and ensuring the safety of the company.

To learn how you can enhance the safety and security of your business, check out KnowledgeCity. With over 9,000 video tutorials in business, computer software, and safety compliance, you can begin improving your business strategy today. Try our Protecting Your Business and The Procedures of Successful Managers courses with your free 10-day trial.

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