A Business That Did Not Plan for Disasters

Recently, a friend of mine, Jim (not his real name) lost his job. The business that employed over a 100 people had a Disaster Recovery Plan (DRP) that was based on the attitude – “that will never happen to us”. What tripped them up was not a disaster that struck them but one that struck a critical vendor.

The vendor supplied a critical part that was absolutely essential in Jim’s business operations. Lack of the component delayed them being able to fulfill their biggest contract in a timely manner. They tried sourcing it from many places, but ran into the same lead time problem.

As a result of the delay – they lost their biggest contract and the company followed the path of reducing expenses (read employees). But this proved to be a short term fix and they were forced to declare bankruptcy. This was a prelude to it closing its doors.

A DRP, including a rigorous Business Impact Analysis would have pointed to the need for an alternate supplier. By the way, the founder and owner of the business was my friend Jim. He lost his job and his business. Prevention is definitely better than cure!