Playing now

Playing now

A guide to business continuity planning for small businesses

Back to search results

Man working with calculator

The July riots in KwaZulu-Natal and Gauteng hit small businesses hard. According to a survey conducted by Redflank’s BeyondCOVID research initiative, small, medium-sized, and microenterprises (SMMEs) accounted for 89% of the businesses impacted by the civil unrest. And this isn’t the only knock that SMMEs have taken of late.

In December, Finfind reported that SMMEs also bore the brunt of South Africa’s COVID-19 lockdown regulations. According to Finfind, 42% of SMMEs closed during the first five months of the 2020 lockdown.

No one could have predicted the pandemic or forecast how devastating the recent unrest would be, which is why it’s essential to have a business continuity plan in place, no matter how small your business is.

What is a business continuity plan?

A business continuity plan ensures your company continues operating after a disruption, such as fire, a natural disaster, civil unrest, supply chain interruption, or cyber-attack.

Not to be confused with disaster recovery – which focuses on returning your operations to normal as quickly as possible – business continuity is about keeping your business open during unusual or unfavourable circumstances. It also sets out a roadmap that the company should follow to minimise revenue loss and reputational damage.

A business continuity plan needs to be written down, including all the steps your business should follow so that you can continue operating without disruption. With an effective business continuity plan in place, there’s clarity around how to respond when something goes wrong. Everyone knows what to do and how to do it and, if there’s any confusion, they can easily access the plan and follow the steps detailed in the document or contact key people, vendors, and contractors listed in the plan.

How to create a business continuity plan

As recent events prove, disasters can and do happen. Below, we outline seven steps small businesses can follow to overcome big hurdles. Here’s how to put together a comprehensive business continuity plan.

  1. Determine your risks

It all starts with assessing the business’s unique risks. In understanding your vulnerabilities, you can see how these relate to potential disruptions, and you can explore different ways to mitigate them.

For example, if your business deals with sensitive or confidential data, you have a higher chance of being targeted by cybercriminals and need to increase your security and POPIA compliance. Suppose your business is located in an area where the odds of flooding are high. In that case, you need to be prepared to handle things like safe evacuation for your staff and keeping everyone updated on contingency measures.

  1. Decide what must be protected

Now that you know where your risks lie, you need to develop ways to safeguard your business against them. In the event of downtime, it’s important to know what you can and can’t do without. Make a list of the critical resources your company relies on – from staff and systems to data and essential equipment. Then rank each in terms of how long your business can survive without that resource in place.

  1. Communicate clearly

Crisis communication is vital when things go wrong. If the usual lines of communication are down, everyone in the business must understand how to reach each other. Consider setting up an email alert system to keep your employees and key stakeholders in the loop about what is happening. You must be able to access your business website and social media accounts remotely if a crisis prevents you from going into the office. Should a disaster occur, be sure to use different channels to provide updates on your recovery process so that everyone knows that you’re handling the situation with care and that you’re still in business.

  1. Prepare your supply chain

It’s a good idea to develop relationships with alternative vendors if your primary supplier isn’t available and you can’t get the critical resources and materials you need to maintain operations. It’s also a good idea to chat to your key suppliers and find out if they have recovery plans in place and how those affect you. In your plan, include a list with the contact information of all important business contractors and vendors if you need to reach them in an emergency.

  1. Have a backup for everything

Should a disaster wipe out your entire business, you need backup office space, hardware, software, and equipment. This doesn’t mean that you need two of everything. If you can’t go into your office, you need a safe place for your team to work remotely. Consider short-term rental options for PCs, laptops, office space, or delivery vehicles. This will allow you to keep running until you get back into your office and your assets can be replaced. Backups are crucial when it comes to business-critical information, such as accounting and people data. Storing your data in the cloud lets you effectively “flip a switch” and immediately access the data you need, from wherever you are, on any device.

  1. Get insured

Total claims following the unrest in KwaZulu-Natal and Gauteng last month are expected to reach R20 billion, according to the SA Special Risk Insurance Association (Sasria). If you lose stock due to a disaster or if your operations are interrupted, having the right insurance policies in place will help with the financial burden you have to bear to recover from the disruption.

  1. Test, test, test

Testing your business continuity plan is the only way to know if it will work. Controlled testing allows you to identify gaps before an incident occurs. Testing should be rigorous. If it is too easy, you won’t be sufficiently prepared to respond with confidence in the event of a disaster. These tests should be run twice a year or more regularly if you’ve made any significant changes to your IT operations or business processes since the last round of testing. Your business continuity plan may be up to date today, but that doesn’t mean it’ll be sufficient forever. Regular testing will highlight when it’s time to update your continuity planning.

Most small businesses cannot afford downtime, which is why developing a business continuity plan is crucial. But remember, you can’t create one in a vacuum. You need to get everyone involved, from senior management to junior staff. That being said, having upper-level management lead the effort is important as they set an example for other employees and show them that creating a solid continuity plan is a top priority.

Small business survival toolkit

Get practical advice to help your business thrive.

Download your free guide

Ask the author a question or share your advice

By leaving  a comment on this article, you consent to your comment being made  publicly available and visible at the bottom of the article on this blog. Whilst your email address will not be publicly available, we will collect, store and use it, along with any other personal data you provide as part of your comment, to respond to your queries offline, provide you with customer support and send you information about our products and services as requested.  For more information on how Sage uses and looks after your personal data and the data protection rights you have, please read our Privacy Policy.

Sage Advice Logo