Disaster recovery plans for online businesses

Disaster. It’s a word we could all do without hearing most days. However, disasters have a habit of being inevitable, sooner or later. Having this awareness means, in turn, that you realize the absolute necessity of planning for the worst, especially in the world of business. 

Should a disruptive event happen to your online business, you’re going to want to be prepared, and this is what we’re going to discuss in our blog. 

We’ll go through some steps you can take now to set your business on the best footing. In so doing, we’ll cover the process that goes into a business continuity and disaster recovery plan. Let’s start, though, with a quick overview of the treacherous terrain we’re talking about.

The cost of disasters

When businesses succumb to disasters, such as power outages, human error, data breaches, and ransomware attacks, we’re all aware of the cost to us as consumers. The inconvenience and security worries are real concerns. However, to a business targeted in this way, it can be nothing short of calamitous. Essential operations can grind to a halt, and issues of confidentiality may arise.

Among the most significant challenges are the financial costs businesses face during such events. For instance, the global average cost of a data breach last year was $4.88 million. This underscores the importance of addressing these risks with the seriousness they deserve.

One of the best ways to do this is to think about how your business would respond to one of these catastrophes and engage in Business Continuity and Disaster Recovery (BCDR) planning. BCDR will help your business get back on its feet in as short a time as possible, minimizing outages, service drops, and the risk of further e-commerce security problems such as data losses.

What do we mean by BCDR?

BCDR is the process of planning that companies undergo to assess the potential impact of disasters and to set in place sound responses that will ameliorate the worst effects. It consists of two processes, which we’ll now briefly set out.

Business continuity

This is the area of activity concentrating on preserving and maintaining critical operations as normal — or as close to normal as possible — in the face of disruption. The focus here is on being proactive and predictive and creating a strategy to alleviate likely negative outcomes. This can cover as many areas of the business as needed to retain a good level of organizational functionality.

For example, if payroll is a priority, the business continuity plan must outline alternative processes to ensure payroll operations continue if the usual systems are compromised. The same applies to accounts payable or any other critical functions.

Disaster recovery

This is more of a response to a specific threat. Whether it’s natural disasters, social upheaval or cybercrime, each threat will affect a business in its own way. Therefore, it’s a sound idea to craft an individual recovery process for each possible business disruption. Of course, the problem here is that you could be writing individual recovery processes for the rest of your life, so many are the hazards out there. So, it’s important to focus on the ones relevant to your business.

Disaster recovery planning focuses more on IT systems, ensuring that critical functions continue to operate during disruptions. This involves analyzing a business’s information infrastructure and determining the best ways to maintain essential data flow. This ensures that employees can access the information they need to carry out vital tasks, even in challenging situations.

This process often includes evaluating staff communication systems to ensure they remain functional during disruptions. For example, if the standard phone system becomes unavailable, alternative methods, such as computer-based calling or messaging platforms, might be implemented to maintain seamless communication.

Using both of these approaches, you will be able to develop an agile and proficient business continuity and disaster recovery plan that will enable your operation to deploy a rapid recovery from a catastrophic event. Let’s now take it step by step so you can see what’s needed.

Building a business continuity and disaster recovery plan

Here are the stages you should go through to produce an effective plan.

Look for vulnerabilities

Just as hazards have their own shape, so do all businesses. It’s next to impossible to take a business continuity and disaster recovery plan off the shelf and apply it to various businesses. It will fail to address the individual characters of each operation.

Instead, you should give yourself time to properly put together a risk assessment to identify your company’s unique vulnerabilities. Here are a few simple steps for carrying out that assessment:

1. Identify your critical business processes: What are the activities without which your business would grind to a halt? Some examples include sales, accounting, operations, fulfillment, product development, and customer onboarding. Create an inventory of these processes as well as supplementary factors that are needed to keep them running smoothly.

1. Map out priorities: Looking at the above processes, which are most vulnerable? What types of situations might put them at risk? For example, if you operate a call center and all of your employees are hybrid, you have to consider interruptions to technology, networks, and employees.
2. Create a list of potential risks: Identify which hazards are most likely to impact the critical business processes you highlighted previously. This can include threats like natural disasters like floods, health risks like pandemics, power outages, and cyber-attacks.
3. Conduct a business impact analysis (BIA): Evaluate how the aforementioned disasters could affect your business processes. Identify the potential physical, financial, and reputational consequences. Consider the estimated recovery time and the potential losses you might incur during the downtime. We will delve into these aspects in greater detail in the next section.

This is a tricky endeavor, as business structures, even smaller operations, can be inordinately complex. So, don’t rush this procedure. Involve as many other parties as you need to. Paint yourself a clear and accurate picture of what’s happening and how things might play out if processes become interrupted.

Set out objectives

There are two objectives that you will need to establish: recovery time objective and recovery point objective. Together, these will help you determine how often to back up data to minimize downtime in the event of a disaster.

The recovery time objective, or RTO, is the maximum amount of time your business can take to resume normal operations after a disruption. This can apply to an overall process or specific systems, such as IT equipment or software.

Calculating this is intended to limit the potential consequences and long-term harm to your company and customers. The longer it takes to recover, the more harm can be done.

Obviously, some businesses have to bounce back more quickly than others. For example, if you’re in the payment card industry, you must keep RTO to a minimum, or the repercussions across the economy and your brand will be huge and possibly irreparable. 

It’s a similar situation if you provide VoIP phone service. If your business goes down, communications go down, which can be lethal for other businesses.

Recovery point objective, or RPO, on the other hand, is the maximum amount of data loss that your business can sustain while being able to recover. RPO is measured in time. This is a particular concern if you have a high degree of tech-based assists, such as robots in fulfillment, which tend to be wholly reliant on up-to-date data supply.

In essence, RPO sets a time limit for how much data you can “tolerate” losing. Meanwhile, RTO measures how long it’ll take you to restore operations back to normal.

So, how do you calculate RTO and RPO? There is no standard formula for doing this, and it differs by company and industry. Use the inventory of critical business processes you created earlier to map out how long each system will take to reboot or return online. These findings will also help you determine the cost of IT downtime to your business. 

Of course, the higher your RTO and RPO are, the higher the cost to your business. Reducing these in line with your objectives takes investment, so calculating them at this stage gives you the information you need to research potential new tools or solutions that will reduce downtime.

Data is the lifeblood of your online business, so it’s a key consideration when thinking about business recovery. If your operation is likely to be crippled by a relatively insubstantial data loss, then this area will need attention straight away. For instance, you can take steps to securely back up your data in real time and in a facility separate from your organization.

Set out responsibilities

Now you have your objectives, come up with a list of duties so everybody on your team knows what they need to do should disaster strike. This is an important step. After all, any sort of business planning, from BPC SAP (software that helps businesses plan, budget, forecast, and consolidate financial data) to BCDR, works best when everyone knows exactly what their responsibilities are.

Create a checklist for relevant team members and stakeholders to follow. Clearly outline everybody’s roles in an impaired structural environment to maintain a degree of functionality. It’s also worth including emergency contact information for key personnel and backup service people.

Lastly, your disaster recovery plan should establish what steps those involved in systems need to take for each likely hazard. In this way, you can successfully meet your RTO and RPO in the event of an emergency.

Make sure this information is updated regularly and kept in an accessible place that will not be affected by a system failure. 

Test and test again

Emergency procedures rely on more than just theoretical planning—it’s the hands-on practice that truly makes the difference. Practical dry runs are invaluable for getting individuals and departments comfortable with their roles and responsibilities, ensuring they can respond quickly and efficiently instead of wasting precious time searching for instructions or asking for guidance.

The frequency of testing will depend on factors such as the size and complexity of your organization and the rate of staff turnover. Testing can range from a straightforward meeting room exercise — where a potential scenario is presented and participants discuss their responses — to more advanced approaches, such as a full-scale simulation program using live business systems.

Regular testing should also include maintenance checks on software and IT systems, as well as verifying that backups are functioning properly. Establish a consistent schedule for these tests, both for systems and personnel and update your plan as necessary.

Designate someone to document testing sessions and identify areas for improvement. Ensure these improvements are implemented and update staff and stakeholders so everyone remains informed about best practices.

Whatever testing technique you use, it’s essential for keeping staff sharp and rooting out problems with systems and even legacy tech.

Meeting with disaster

With disasters potentially able to strike at any point and from different angles, being prepared is necessary for any online business. Follow the tips included in our guide to design and implement your business continuity and disaster recovery plan and gain the peace of mind you need to run a thriving online business at all times.