By Jim Caliendo, President/COO PWCampbell
In the wake of an unprecedented number of hurricanes, our minds naturally turn to thoughts of “What if that had happened here?” As a bank leader, your employees, customers and community will be looking to you for direction and solutions. Are you prepared to lead them and your business through a disaster? How can you better prepare yourself and your company for a catastrophe and who should you call on to get ready?
While no one can truly understand the devastation and upheaval that takes place during a crisis, there are some things that can be done ahead of time to help minimize the stress, anxiety and time it takes to get back up and running. The first 48 hours following a major disaster are critical to implementing an effective plan of action for recovery. As a financial institution, your customers will not only want to know that their money is safe, but also will most likely need access to their funds to aid them in their own recovery efforts.
With the onslaught of natural disasters, cyber threats and other emergencies, business continuity plans are becoming more important than ever. The FDIC now requires full compliance with FDIC disaster recovery and business continuity regulations. As part of that compliance, there are three facets of the FDIC requirement that banks are obligated to meet. First, the bank must prove that it has a formal business continuity and disaster recovery plan. Second, it must be able to execute the plan. And finally, the plan must be tested on a regular basis and updated accordingly, which I believe is the most critical of the three.
While developing a comprehensive “disaster plan” seems like a daunting task, you may be able to rely on your vendors for help. For example, a design/build firm can first and foremost secure your facility and then offer several secondary resources, including comprehensive risk assessment questionnaires, implementation of off-site trailers complete with the necessary equipment to have you up and running quickly, and the ability to contact and manage contractors to assess and repair any damage to your building(s). Contacting your vendors ahead of time to determine what, if any, assistance they can provide is a good start to developing your recovery plan and can minimize the workload of your staff during a critical time, so that their focus can remain on the customers.
In addition to utilizing your vendors and knowing and documenting what assistance they can provide, it is also important to develop an emergency response team. Prior to a crisis, this team would be responsible for compiling and organizing the necessary information to be used in an emergency situation. The team members should be diverse and be representative of different departments within the bank so you can ensure information vital to all areas of operations can be assessed. A sampling of the information that should be collected includes, but is not limited to: a listing of building utility and equipment shut offs, a catalog of critical equipment and materials, a plan for handling core processing and remote capture, an inventory of emergency supplies, evacuation plans, fire detection/alarm checklists, complete insurance information, key service vendors along with contact information, a list of employees with specialized training or skills who can help out during the crisis, contingency plans for moving operations, equipment, etc., and a plan for storing important records and information. While a majority of the work of the emergency response team is done up front in ensuring you are prepared, this team would also be responsible for actual implementation of the plan should a disaster occur. Therefore careful thought should be given to selecting the team members.
While there are many different types of disasters that can occur, preparedness is the common thread of any effective disaster recovery plan. It is important to understand what type of natural disasters can and are most likely to happen in the community in which you live and work and then know what to do to be safe and mitigate damage that can be caused by each one. For example, if you happen to live in a snowbelt area, it is imperative to have a discussion at your institution centered around winter snow storms and freezing temperatures. We sometimes don’t consider the accumulation of snow as part of our disaster contingency plan, but should. As you prepare for your talk on this particular disaster, you might want to keep the following goals in mind:
- Share the potential impact of winter storms and freezing temperatures—determine when and how you will communicate the information to your employees and what your expectations will be at that time. Be sure your expectations are reasonable as travel to and from work may be inhibited and employees may need to deal with their own crisis at home, which could prevent them from coming into work. Getting all staff members to the office could be next to impossible but it is critical to have at least a few staff members as customers will need access to their money.
- Know the National Weather Service (NWS) terms that are used to describe changing weather conditions. These terms may include advisories, watches, and warnings— and can be used to determine the timeline and severity of an approaching storm.
- Emphasize the importance of having supplies ready to stay at work for a minimum of three days without power, water, or heat.
- Outline and test your organization’s emergency communications plans and policies.
- Learn how to sign up for local text alerts and warnings that may be available in your community.
- Develop contingency plans for all aspects of operations in the event “business as usual” is no longer an option.
- Designate one or two employees that are “musts” to travel to work. Ensure they are trained and have a clear cut, step by step plan to be able to provide necessary operations.
- Have a list of pre-arranged vendors who are able and prepared for snow removal so access to your facility will be possible.
- Test, test and re-test your emergency and contingency plans and policies on a regular basis and modify as necessary.
While no one can truly comprehend all the complexities that come with the many different types of disasters that can occur, being organized, informed and prepared as much as possible can lessen the hardship and ensure your business is up and running in a timely manner, offering assistance and peace of mind to your customers.