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Staying Afloat: Eight Key Steps to Effective Disaster and Busine

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We have witnessed the chilling devastation caused by Hurricanes Katrina and Rita in recent months, but they are just two of the many hurricanes and tropical storms that have battered the Gulf Coast and tested the survival skills of the regions green industry businesses. Sad to say some green companies have fared better than others. Take, for instance, the U.S. lawns franchise chain, which has 140 franchises in 28 states. We have six franchises in the Gulf Coast region, but only one, U.S. Lawns of New Orleans, experienced serious damage, revealed Ken Hutcheson, president of U.S. Lawns, Inc. Given the devastation in the region, we were quite lucky.

Happy Lindeen, the owner of that U.S. Lawns of New Orleans franchise, had his business up and running as of September 16, but nearly a month later, he still did not have ten of 17 employees back on the job. Lindeens franchise is located in the New Orleans suburb of Jefferson about six miles from the French Quarter.

It took us nearly 24 hours to evacuate to Dallas, Texas, because the roads were clogged, Lindeen recalled. The trip would normally have taken us about eight hours. We didnt have any flood damage, but Katrina blew some of our doors off and it was a mess inside our building. Fortunately, I moved three of my four trucks to safer ground, so they werent damaged. It will take New Orleans months to recover. In the meantime, Ive lost about a third of my business. It was the third time in the last three years that Lindeen has had to evacuate New Orleans.

A green company located far and seemingly safely away from New Orleans and hurricane country, may think that they have nothing to learn from the experiences of Lindeen and others in the industry located there, but they do. After all, disasters or business interruption can have many causes besides a hurricanefire, ice storm, mudslide, blizzard, earthquake, a wild fire and even a fire next door, for starters.

Kinnucan Tree and Landscape Company in Lake Bluff, Illinois, has been involved in disaster planning for thirty-five years, primarily through its tree care and snow and ice management operations. The company has dealt with numerous wind and ice storms, micro-bursts, tornadoes, heavy snow storms and blizzards. "You will have little or no time during a disaster to plan for it, Kinuccan explained. To be really effective, you must prepare for a potential disaster before it happens.

Rich Angelo, president and operations manager for Stay Green, Inc. in Valencia, California, has lived through several earthquakes, including the big one in 1994 that destroyed part of a freeway. He reiterated Kinnucans advice: A green company needs to be prepared, no matter where they are located, Angelo said. Dont thinka disaster cant happen to me. If you do, you might be sorry.

Business consultants knowledgeable about disaster and business interruption planning say every green industry company should have a well thought-out plan of operation in place in the event of the unthinkable. Its amazing how many businesses, large or small, dont have such a plan, said Wally Bock, a business consultant in Greensboro, North Carolina, who has helped companies with their disaster planning.

Such a plan is as essential as a business plan for the successful operation of your company. So what should a disaster plan include? Following these procedures will help you stay afloat, if a disaster or a business interruption rears its ugly head.

Plan for the Worst Case Scenario
Think of what might be the worse possible thing that can happen to your company and then plan to deal with it. To be truly effective in a disaster, a green company needs to adopt a military mind set, Kinnucan advises. "If we are not yet at war, we are getting ready. Therefore, disaster preparation planning needs to be incorporated into a companys culture. As part of our company culture, were either dealing with a disaster or a business interruption situation or getting ready for the next one.
Kinnucan further advised that, in planning, ask yourself a lot of what if questions. What if the power lines go down? What if the streets are blocked? What if I cant get to my business the next day? What can I do?

Develop a Procedures Checklist for Immediate Issues
The checklist should include information that provides contact information for the landlord, key suppliers and vendors, your insurance company, emergency services, store supervisors and important customers. After hours contact information should also be included.

According to Kinnucan, the checklist will be woefully incomplete unless some other information is also considered and/or gathered. This includes:

  • the backup power capability to run your operation base;
  • mechanics and repair parts to be kept on hand in sufficient quantities;
  • the welding and steel stock for emergency repairs, sources to purchase additional tools, equipment and vehicles as needed;
  • communication systems and procedures that will function during a disaster;
  • sources for additional labor, equipment and vehiclesthat is, subcontractors that can help your company rapidly mobilize;
  • polices and procedures for contracting work,
  • establishing billing rates for workers and equipment used, and collecting money for work completed on a timely basis;
  • portable electrical generators and flood lighting equipment for working in the dark;
  • proper clothing for employees to work in a disaster area and procedures to enable your staff to get to work during disaster conditions.

Judy Guido, principal partner in Guido and Associates in Moorpark, California, and a consultant to the green industry said, Make the plan as thorough as possible. Its important to get employees involved in developing the disaster preparation checklist. Develop a team approach. Someone will have to be responsible for something as simple as counting heads to ensure everybody gets out during an evacuation. You are the boss but you cant think of everything, Guido emphasizes.

At Kajawa Enterprises in Oak Creek, Wisconsin, the crew chiefs and supervisors are actively involved in disaster planning. We have a safety committee that meets regularly, said Ron Kajawa, the company CEO. We dont know how other companies do it, but we believe disaster preparedness and business interruption is the responsibility of that committee.

Lindeen revealed that he didnt have a disaster checklist prior to the Katrina disaster, but the frustration of dealing with the mega hurricane has compelled him to draft one. I do have a disaster plan in place, but its not as good as it should be, he conceded. I am now keeping a laminated sheet that provides a list of things to do prior to a hurricane. I will keep it handy and check things off as we go.

Have Regular Checkups
Check the safety and condition of your facilities, both the exterior and interior, regularly. Also, make sure your place of business has enough gas on hand in case of an emergency. A checkup will also include making sure you have enough of the right tools on hand in case you need to make repairs during an emergency or disaster.

Regular on-going checkups are essential for disaster and business interruption planning, Bock stressed.

Protect Your Vital Data
Gather your vendor lists, accounting data, employee information, marketing plans, insurance policies, legal papers, leases on your vehicles and major equipment, papers relating ownership and other essential documents and put them in a water- and damage-proof facility located outside your facility.

The three times that Lindeen had to evacuate New Orleans he took the following items with him: the accounts payable and receivable files, his desk top computers hard drive and the laptop containing the Quick Books information. We take all our customer files with us, so if something happens we can re-construct the business, Lindeen explained.

Protect your business data by creating backups on reliable media that are regularly updated and kept in a secure off site location. A business has data that needs protecting and is important for reconstructing the business if the worse happens, said Jim Dion, president of Dionco Inc., a Chicago-based retail consulting company.

Kajawa added, Back up your operations and you can keep things moving during a crisis.

Use Your Community Resources
The business community and the police and fire departments are always ready to help out. So dont be shy about asking them to talk to your employees. Bock added, Consider using the Small Business Administration and the local Chamber of Commerce, which can offer free safety training, if businesses want it.

Get Adequate Insurance
This is so vital to your disaster plan that its imperative you check out your insurance company very carefully. When the policy arrives in the mail, go to the insurance company and review your policy in person with the agent. You dont want any miscommunication or surprises.

Review the policy regularly, too. "Its important to establish a solid relationship with your insurance agent," Kajawa stressed. "Weve been with our agent for 30 years, and hes intimately involved with our business. He knows our industry well and can make proper suggestions as to what we should and should not do."

Scott Simmonds, a consultant with Insurance Consultants of Main Inc. in Saco, Maine, said its important to make sure your insurance policy covers not just disaster recovery but also business interruption. Its going to be tough for your business to stay afloat without regular cash flow, Simmonds said. "Business interruption insurance will pay for such things as employee salaries, the bank loan and the financing on your equipment until you get back on your feet.

Lindeen did not have business interruption insurance. I didnt know about it and didnt think about it, and neither did the franchisor, Lindeen said. We all thought that type of insurance was too much of an expense. Since I dont have it, Ive lost an entire month of revenue, which really hurt. Im on the franchises safety council and Im making sure that it gets the word to my fellow franchisees about the importance of having business interruption insurance.

Its also important to photograph or videotape the inside and outside of your facility in case you need to document an insurance claim. "You need to know whats in your building, Guido explained. An insurance company will pay 100 percent of the policy, but they will want you to make a list of everything in the building.

At the end of the day, you may want to consider hiring a public claims adjuster, which will work for you and not the insurance company. You wont have to deal with your insurance company if its giving you a hard time. A public claims adjuster charges about 10 percent, but it can be worth it.

Network
Talking with others in the industry about insurance and other disaster-planning related matters can help you stay on top of developments and perhaps save you headaches down the road. Network with other people in the industry to share ideas and form alliances, Kinnucan advised. Read industry publications and attend the trade shows to keep up with the new equipment and suppliers that are available.

Review Your Plan Regularly
Your business needs and priorities can change, as well as your employees and the technologies and equipment you use. Your location or facility can change as well. Guido suggests reviewing the disaster plan every six months. The bottom line is that a green business has first got to be prepared and then hope that the worse never happens, she explained. You cant make it up as you go along. You need a plan. As a business owner, you are the leader, and your employees are going to expect you to provide direction in a crisis.

Kinnucan added, After a disaster do a thorough review of your procedures and policies and be prepared to continually improve your preparation.

Thats what Lindeen has done and now hes ready to move forward. He has no plans to leave New Orleans for safer pastures. New Orleans is where I built my business, Lindeen said. Im going to use the Katrina disaster as an opportunity to make my business better. Im going to hire better people. Ive had a few clients that werent too good and Im going to let them go. I have to look at it positively or I would cry.

Editors Note: Contributing writer Ron Chepesiuk (www.ronchepesiuk.com) is a South Carolina based business writer.

 
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