Magazine article Risk Management

Disaster Recovery Planning - Ignore It at Your Peril

Magazine article Risk Management

Disaster Recovery Planning - Ignore It at Your Peril

Article excerpt

Unfortunately, it usually takes a disaster to understand the need for a disaster recovery plan. Disaster recovery planning -- a corollary function of risk management and an effective mitigation tool, especially for unpreventable risks -- is often considered a luxury because of operational commitments or, in the case of a utility, just another service-restoration function. But not to address the likelihood of adverse events of large proportions can doom a business to failure or, at the least, subject its officers to stockholder suits.

Illinois Power initiated efforts to develop a corporate disaster recovery plan in 1989. The plan was to provide a corporate-wide response to adverse events that would be activated if the company's affected areas could not control or correct the resulting damages on their own, and to be an umbrella for the existing but separate emergency-operation plans in place throughout the company. The plan's goal would be the preservation of life and property and the return to a normal state of business in the shortest possible time at the least possible cost in the case of catastrophic loss.

The risk management department proposed a multi-year program to develop a detailed disaster recovery plan beginning with the corporate departments, which, unlike the power plants and the service areas, had never done disaster recovery planning. Risk management issued a planning guide to each department that requested information on activities, data, staff and equipment that would be deemed critical if lost. Departments were also asked to designate individuals who would carry out critical department duties in a reduced-staff mode and, possibly, away from their regular workstations. Lotus and Symphony spreadsheet programs were used to record the data for ease of update and offsite security.

A cross-functional team consisting of personnel from risk management, human relations, purchasing, public relations, accounting, the power plants and the service areas was then given the task of developing a shell plan that would outline minimum responsibilities and tasks to be completed in the event of a disaster. The "how to fulfill" decisions were left to functional groups designated by the plan, with the cross-functional team acting as a resource.

The plan designated five functional groups (operations, funding, personnel-logistics, technical support and communications), to be overseen by a disaster recovery manager with the assistance of a disaster recovery coordinator. Each group was given responsibilities, allocated corporate assets and assigned a leader and a successor. The operations group was represented by the officers responsible for the operating elements with emergency plans already in place.

There was resistance from the operational elements because they felt the plan was redundant. To overcome this obstacle, risk management reiterated that the plan or parts of it would be activated only when the affected elements could not control or correct an adverse event with their own resources, emphasizing that existing operations emergency plans would not be affected and that planning was focused on the support elements. One reason the operational units had difficulty accepting the plan was that they had never experienced a situation where they were denied access to their normal workstations, their supply storerooms or their staff.

Geography and an earthquake prediction changed that mindset. Illinois Power's major fossil plant and the largest segment of the utility's customer base are within the New Madrid Earthquake Zone, in southern Illinois. …

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