Disaster Management Plan

Access your KPIs online;
Measure your success;

Navigation: All Balanced Scorecard Articles > General

Should every company be ready for disasters even if it is doing OK now? The answer is most certainly - Yes! Read this article to grasp principles of disaster management. Check additional information about disaster management plan.

Without any doubt it would be fair to say that every company must be ready to face the worse of the worst. Sure, optimism is definitely a good thing, however the reality is sometimes very cruel, especially in the business world. Every 15 or 20 years the world is going through a new stage of financial meltdown. This happens irrespectively of company performance, and thus nothing could be done to avoid it. Yes, in some cases it is impossible to avoid disasters and crises. At the same time it is possible to reduce and minimize effect of the crisis. How is that achieved? Disaster and crisis management can certainly help. It should be mentioned that there are no universally accepted crisis plans that work equally well for all companies, irrespectively of industry, operating markets, organization structure in strategic goals. Every business is unique, and thus every crisis plan should be individually developed. In this article will not talk about peculiarity is of crisis plans in various industries, but rather touch upon stages of creating a comprehensive and effective disaster management plan.

Firstly, top management of a company should understand difference between real and potential problems. In urgent cases crisis plans deal with problems that have already evolved into disasters and consequences of these problems of very serious. Very often this is "to be or not to be" question. In order to avoid such situations crisis management plans should be developed and implemented even when everything is OK in the company. Remember that stability is always unstable. Sooner or later every business faces difficulties. Thus, focus on potential problems we'll protect the company.

There is another important thing. It is important to model different scenarios and situations. There are changes in market conditions and national economy that cannot be managed. However, their key fact can be reduced if the company starts preparations in advance. Crisis management can be compared with meeting hooligans in the street. If you're not ready to act you will be robbed. If you have various scenarios in your mind you have chances to escape, maybe with minor losses only. Disaster management plans are developed to arm companies with tools to solve problems at the early stages. Sometimes it is too late to act when sales have dropped by 50% and customers are buying from your competitors. Through strategic analysis it is possible to envision such situation and make drastic changes and decisions to avoid business disasters.

Restructuring and cost saving are the two things no company can avoid one implement and disaster management plans. If something went wrong than the company structure and business processes do not meet requirements of the modern market. External changes should always find their counterpart in internal organization changes.

It would be also very helpful to study experience of leading world companies, each of them having done through harsh times. Of course, as already said above, every experience is individual, however, it is possible to learn a good lesson from such case studies.

If you are interested in disaster management plan, check this link to find out more about disaster management plan. Also, you can check other articles in General category.

Balanced Scorecard Toolkit includes step-by-step manuals, documents, presentations, check lists designed to help business professionals with successful development and implementation of Balanced Scorecard. Learn more about BSC Toolkit.