The Necessity of Disaster Planning

In this, the first of two articles, we will take a long hard look at aspects and the necessity of Disaster Planning. Very often this type of planning is not very high on any business owners agenda. But, with Climate Change having such an impact and causing such severe climate extremes this is an area that really must be addressed. It has been a long time since I was an auditor but is this not an audit issue? If not, then maybe it should be?

Toward the back end of September 2021 I was holding an online IGNITE training workshop for SAICA (South Africa Institute of Chartered Accountants. This was the fourth in a series of workshops and was attended by over 200 accountants. We decided to incorporate a series of panel discussions to provide opportunity for participant feedback. One of the panellists was Chantel Elliott of Chantel Elliott and Co, a 20+ person firm based in Shelley Beach, Kwa Zulu, South Africa.

During the panel discussion Chantel was asked about her firm’s response to the rioting in Durban in July of this year.

You may recall that the riots started as former President Zuma started serving a 15-month sentence. During the violence South Africa was gripped by a frenzy of looting and arson. By the end it was estimated that more than 300 people had died.

As Chantel told of her response you could have heard a “Zoom pin drop” 

She explained how vitally important it is to show leadership and also heaps of kindness to help clients in their moment of need. Her firm was 100 per cent committed to delivering food parcels to the community.

Lessons Chantel reported: 

  • Make sure you have a written emergency plan
  • Draw up, in advance, a disaster checklist
  • Make sure that all clients have good recording keeping and back ups
  • Be ready to help clients with grant and loan applications 
  • Be available to negotiate with insurers and bankers
  • Work with clients to create business reconstruction plans

The BBC reported on Entrepreneur Dawn Shabalala. Dawn is the owner of four shops and said, “Everything is gone. I have no insurance. I’m worried about the future of South Africa. I’m worried about the future of my kids.” Her four shops were looted – down to the last water pipe and electrical fitting. 

She recalled watching in horror and frustration as overstretched local police made no attempt to stop the destruction. “I fear it can happen again. But where do I go? What do I do? I had 12 staff that I can’t afford to pay. The government didn’t take any notice of this,” she said, standing in her ransacked hair salon on a street where every shop appeared to have been cleared out, with several set on fire too.

Chantel’s response is as follows:

I will not attempt to sugarcoat these recent uprisings, riots, and looting. It was scary! Everyone was affected in one way or another. However, what came out of this was a resilience (the capacity to recover, survive, or grow quickly following a crisis) to the disruption and a unity amongst the community that is truly inspiring!

My advice to Dawn is to focus on the way forward and to rebuild not only her shop/business but her community relations. This devastating event has forced us all to embrace what being human is again. Support and friendships come from these crises. 

Tap into your inner grit and remember that although you may be starting from scratch, this time round you are wiser and more experienced, this will ultimately result in higher success. I implore Dawn to contact a local accountant to assist her in applying for the various grants and incentives available to re-establish her business. Many firms are providing pro-bono services to assist these small businesses. They will also assist her to foster cooperative relationships with others in similar industries and locations which will assist her lack of resources (equipment, business space and funds). This ultimately changes competitive differences into potential growth opportunities for small businesses.

Chantel Elliott of Chantel Elliott and Co

Social media and world-wide news feeds mean we all hear about these disasters almost immediately after they occur. You may recall the floods following Katrina (2005) in New Orleans which were forecast in advance but still managed to wreak greater havoc than ever expected.

I held an online meeting on 5 July this year with about 15 of my Church friends. Our guest speaker was Rob Marris, former MP for Wolverhampton for 15 years. He was a regular speaker in the UK Parliament on climate change. Rob spoke powerfully and knowledgeably on the risks emanating from the failure to address the problem of climate change. He forecast, among other matters, that there would be an increase in flooding. In the 30 days after his talk I counted 6 serious floods around the work in places such as Scotland, London, Germany, Switzerland. Netherlands, New Zealand and I suspect that is not even a full list.

Types of disaster

There is no country that is immune from disaster, though vulnerability varies. There are four main types of disaster. These ‘natural’ disasters impact everyone in the areas affected. Families, business owners, communities – no one is exempt from the ravages of nature as those who have businesses and clients that have found themselves in the path of hurricanes, cyclones, earthquakes (e.g. Christchurch, New Zealand), bushfires (Australia) or wildfires.

We live in an era of disasters – it might be an online attack, technology failure or possibly a key member of the team announcing their departure. It might even be the loss of a prestigious or high fee-paying client. Some have endured lawsuits that have resulted in resources being absorbed into discovery and defence. One of my clients has recently been the subject of a claim of sexual harassment and rape that has devastated all those concerned.

In the past two weeks in the UK we have seen fuel pumps run dry because of an inadequate number of haulage drivers (or maybe it was an over reaction from us Brits?).  – “who could have foreseen that” most people were asking?

The shortage led very soon to really poor/appalling behaviour – here is just one headline from the Daily Mail:

“Driver pulls ‘knife’ on motorist who runs into him during forecourt row as petrol crisis deepens with Boris Johnson calling in the army, while calls mount to let key workers jump the massive queues for fuel.”

Watch this space: COP26 United Nations Climate Change Conference: 31 October to 12 November 2021, Glasgow, UK – 

“The COVID-19 pandemic has brought devastation to millions around the world, disrupting many parts of the global economy. Governments, including our own, have stepped up to protect lives and livelihoods. But climate change has continued, and it ultimately threatens life on earth.” 

Alok Sharma, COP President-Designate

For more information –

Client service in the spotlight

The question all of this poses is, where are you with your disaster planning? To what extent do you discuss this with clients? Do you offer Disaster Recovery Consulting as a service? How could you extend your capabilities to include this service offering?

Key recommend: In the 35+ years I have been in business I have always had a business plan. I discussed business planning with at least half of my business clients a powerful inner belief in the importance of planning because that was an aspect of business management that was essential to me.

Key point: Ensure you have your own disaster management plans in place as this will propel you onto conversations that give the opportunity to emphasise your commitment to this component of planning.

According to IBM, “Another current trend that emphasizes the importance of a detailed disaster recovery plan is the increasing sophistication of cyberattacks. Industry statistics show that many attacks stay undetected for well over 200 days. With so much time to hide in a network, attackers can plant malware that finds its way into the backup sets – infecting even recovery data. Attacks may stay dormant for weeks or months, allowing malware to propagate throughout the system. Even after an attack is detected, it can be extremely difficult to remove malware that is so prevalent throughout an organization.”

Where to start

Surely the starting point must be a business impact analysis. What is at risk? Business records may well be close to the top of the list but business continuity will be on most business owners list. It certainly is here in the UK with inability to buy fuel with the seemingly inevitable consequence of arguments and violence at the pumps.

Recovery of records is likely to be an easier task than business continuity. Without reverting back to Covid (which has been the subject of many of my blogs) many firms were able to continue with staff being based from home. 

“Businesses are increasingly subject to disruptions. It is almost impossible to predict their nature, time and extent. Therefore, organizations need a proactive approach equipped with a decision support framework to protect themselves against the outcomes of disruptive events.” 

Navi Sahebjanima, Researcher

Up in my next issue

In the second of these two articles we will look further into a series of practical aspects of disaster planning, including a look at the Queen Elizabeth!! and:

  • Reasons for having a detailed and tested Disaster Recovery Plan in place
  • Disaster recovery plan checklist
  • What role does insurance play in a disaster recovery plan?
  • Volunteering – examples of how accountants can be of value 
  • Where else to look for help

“Support business continuity with cloud disaster recovery within minutes of an outage with Disaster recovery as a service.