The deadly hurricane currently wreaking havoc on the US state of Texas has highlighted the importance of risk management strategies to ensure a business can survive severe interruption.
At the time of writing, Houston, the fourth-largest city in the US, had received more than 1.25 metres of rain in less than a week – the heaviest falls ever recorded in the region, according to the ABC.
In addition to the tragic loss of life the storm has inflicted, the livelihoods of many locals are also under threat as businesses remain either underwater or inaccessible.
For those of us here in Australia, it serves as a reminder about the importance of risk mitigation and disaster management to ensure that a business can survive for the long-term.
“You need to be able to cope with the stuff that life throws at you, the risks that life throws at you,” said Rick Stone, owner of risk management consultancy Tigertail.
“Whether those risks are key people leaving your organisation, key suppliers going bankrupt, key customers disappearing or your building burning down, you need to able to cope with that. You need to be able to bounce back from that.”
According to Mr Stone, the businesses that are best able to overcome major disruptions are those that not only have plans and procedures in place, but also having the entire workforce able to adapt to sudden changes to minimise any downtime.
“I think one of the key things about organisations that succeed is that they are able to cope with change,” he said.
That can include the ability for employees to work remotely, backing up copies of sensitive business to an off-site location as well as having adequate insurance coverage.
“It’s all about how quickly [your business can adapt to change], and with agility you can cope with that,” Mr Stone said.