Better Disaster Planning Than the Titanic

In my 15 years, I've had what I'd call a rather prosperous commercial career. I can think of around 10 or 12 truly amazing, joyous experiences during that time.

One of them was the first time we ever spent £10,000. It was a sensation like no other.

The part that no one discusses, however, are the 5-7 total failures that must occur before you reach those landmark achievements.

I'm in a pretty good position at this point to advise you on how to prevent as many of them as you can, so I want you to think about what single incident could harm your company.

"All our customers leaving" is not a single event; it is a series of occurrences. Nevertheless, "Our biggest customer leaving" is a positive one.

Here is one instance. Rob, my brother, owns and operates a very prosperous video production firm in Brighton. He has recorded Tony Hawk, a well-known skateboarder, the writers of the bestseller "Brilliant Selling," and Graham Rowan's "Elite Investor TV," the top investing online TV program in the UK.

Rob's issue is that he has roughly 5 clients.

They all adore him dearly, and their businesses are all based on his services, but if he loses even one of them, 20% of his clientele will be gone.

What would you do if your biggest client disappeared tomorrow?

What would happen if your server crashed and you lost all the data on it? Are your existing backups sufficient to restore everything?

What if you simply didn't get paid by everyone who now owes you money? Would you survive or would you be destroyed?

What would happen if you had to move there yourself? How would that impact your company?

Just take a moment to consider the top two or three things that could actually ruin you, then start making preparations.

Here are some solutions to the typical ones.

Few Clients, High Spend or Your Biggest Customer Leaves

If you struggle with having few but high-paying customers, try investing just 5% of their earnings in sponsored advertisements. Whether they are genuinely profitable is irrelevant. The security of having more customers is what matters, as long as you're breaking even on that marketing spend.

Don't believe the myth that providing excellent customer service will keep them for life. There are times when events just happen beyond your control.

Overdue Money Doesn’t Get Paid

Negotiate better conditions if you frequently have huge sums of money overdue and that disturbs you.

Try negotiating 7-day terms if they now pay on net-30 terms. Call your main contact and explain that 30-day periods are becoming challenging if that seems unachievable.

Major Technical Issue

Consider server failure, data loss, and equipment failure.

What type of redundancy can you use to prevent the issue from becoming wholly incapacitating? Every two hours, Better Proposals performs data backups and stores them for three months. Although it is wholly unneeded, it is nevertheless wise to take the precaution.

We also have a hosting setup that is totally mirrored. We'd be up and running in 15 to 20 minutes even if the main Better Proposals server suddenly stopped working and the local mirroring didn't operate (let's imagine the datacenter was bombed). In order to make sure that we can quickly recover any lost data in the event of a server catastrophe or malfunction, we also make use of a dependable hyper-v backup solution.

Key Person Leaves

Sabrina is that crucial figure in my eyes. What would mess me up if she left tomorrow? Do I remember every password? Do I have the phone numbers for everyone on our development team? Do I know the name of the hosting company's contact person?

These are all simple questions, yet solutions are still required.

You Have to Physically Relocate

Life takes place. Perhaps your wife finds a job halfway across the country, or perhaps you need to go to a hotter country for health reasons. For whatever reason, you need to be ready for it.

I wholeheartedly support the concept of managing a remote business. Running a remote business is something you should do even if you don't need to.

You can get started by reading Automate Your Business, which I wrote. This will assist you in putting a foundation in place from which you can begin to keep the majority of your organization in the cloud.

Conclusion

The problem is this. All of these things are no longer a problem. People with common sense will be aware of this and understand that it doesn't exclude future problems from occurring. The best thing you can do is take steps now to safeguard yourself for eventualities where things may not be quite as sunny.

Consider it similar to purchasing insurance or installing a security system in your home. It's not something you need until it's already too late.

The difference is that if you're not careful, "too late" could result in the full failure of the business.

Be wise.