What Is A Business Emergency Action Plan?

Before we get to know what a business emergency action plan is, we should be familiarized first about what an emergency action plan is. Simply put, an emergency action plan refers to a business document that tells the employees of a company what to do and how to act in the event of a workplace emergency. This document should be written in accordance with the standards set by the Occupational Safety and Health Administration (OSHA).

A Business Emergency Action Plan is a document that establishes a precise organizational structure for responding to business emergencies. It also gives roles and responsibilities to the employees for carrying out the plan in the event of an emergency. A properly-developed business emergency action plan, as well as thorough emergency training of the personnel (to ensure that they understand their various roles and duties in the action plan), are required for it to function efficiently.

Elements That Can Be Found In A Business Emergency Action Plan

The contents or elements of a business emergency action plan are unique to the type of business that an individual or a company is running. Nevertheless, some common elements still exist, which are the following:

Resource Management. This element of the emergency action plan should be covering the resources that the business needs to effectively respond to a disaster or an emergency as well as the resources that the business needs to keep the operations and communications up and running during and after the incident.Emergency Response. This section of the emergency action plan will detail your actual reaction methods, or in other terms, the ways on how you’ll safeguard your employees, operations, and properties in the event of specific disasters or emergencies. Methods can include procedures for evacuation, shelter-in-place procedures, and lockdown procedures, among many other things.Crisis CommunicationsIn this section of the emergency action plan, you will want to layout an effective plan for communicating with management, employees, customers, and the general public in the event of a crisis or an emergency.Business Continuity. Using the data you’ve gathered from previous business impact analyses that you’ve conducted, outline your recovery methods in this section of your business emergency action plan. Your goal will be to use these recovery tactics in order to mitigate some of the negative business effects of any disaster or any emergency; At this point, you may also want to break down financial recovery possibilities such as disaster loans or any other emergency funding options.Information Technology. In this element of the business emergency action plan, you should have a procedure detailed for saving, recovering, or replacing computer hardware, software, and any other important forms of technology or data.Employee Assistance. This section of the business emergency action plan should lay out details on how you, as an employer or a business owner, will work with your employees in the event of a disaster or an emergency.Incident Management. This section should define the person who is in charge of what aspects of your emergency action plan, as well as how those people should react before, during, and after an emergency or a disaster.Training. Last but not the least, you should describe the details on how you will train employees on this emergency action plan. You should also include specific training details for an individual that has a key role in the implementation of the action plan, such as a specific role in concerning the management of any business incidents.

Common Factors That Impact A Business

Here are the most common unwanted events or factors that can negatively impact the way a business is operating:

Lost sales and income. The most immediate impact of your business being closed due to a disaster would be the loss of income that you could have generated during that period. You can estimate the immediate financial impact by multiplying your business’s average daily sales volume by the number of days that you might expect to be closed in the event of a disaster.Delayed sales or income. If your business is closed because of an emergency or a disaster, the availability of people or a damaged supply chain may affect how quickly sales will recover to pre-disaster levels once it reopens.Increased expenses. New equipment or materials, the replacement of any inventory that was damaged, overtime labor for your employees, and other costs can possibly be incurred during the process of recovering from a business emergency or a disaster.Regulatory fines. Noncompliance can result in fines or penalties from industry and government agencies in some circumstances, especially if the non-compliance directly led to the disaster. If your company operates in a highly regulated industry, you should think ahead of time about how any form of compliance difficulties can affect your business response strategy.Contractual Penalties. If your business acts as a major supplier or vendor and carries major contracts, chances are you might be carrying a penalty or face the loss of a bonus because of a delay in providing your product or service. You as a business owner should understand that delays are always inevitable in the wake of a disaster or an unwanted event. You should know how to factor in how delays can affect your contracted revenue.Customer dissatisfaction or loss. Although this is not always the case, clients occasionally can’t wait to get their hands on the product or the service that you usually offer. In this instance, you should keep in mind that any form of disaster or emergency could result in a loss of clients, and, as a result, a loss of sales.Delay of new business plans. If you’ve begun a new business endeavor or a business project, or are just about to start one, you should keep in mind that a calamity will have a significant impact on whatever you want to achieve for your business. You should think about the implications of having to put these possibilities on hold while you recover from a business emergency or disaster.

Step By Step Process In Creating An Effective Business Emergency Action Plan

Developing a business emergency action plan can prove to be difficult since there are a variety of disasters and emergencies that a business can possibly face and creating a plan covering all possibilities will be very much impossible. An effective business emergency action plan can serve as an essential emergency tool in case an emergency does occur in the business. Here are the steps in creating an effective one:

Step 1. Develop the Outline and Guidelines for the Business Emergency Action Plan

Before you can start writing an emergency action plan, you must first gather your company’s objectives and rules for the plan, At a high level, the purpose of the plan will be to minimize the impact of the disaster or the emergency on your business, protect your employees, assets, and operations, and get back to business as soon as it is possible to do so. However, there are also some specific needs for your plan that you need to think about as well. These characteristics or needs are specific to the business that you’re operating and the requirements that are mandated by the local and federal regulations.

Step 2. Assess the Risks and Threats to Your Business

The next step to do would be to assess the hazards and risks to your business once you have a better understanding of the federal, local, and business-specific standards that will play a part in the construction of your disaster preparedness plan. Of course, it will be very hard to identify and plan for all types of risks and hazards; however, by identifying the ones that are most likely to have an influence on your business, you can end up creating a more effective and relevant procedure. In assessing the threats, you can start by preparing about the most common scenarios that pose a major risk such as fires, floods, earthquakes, and other natural disasters. You should also consider other threats that can prove to be less obvious such as active shooters and security incidents.

Generally speaking, you should prepare for risks that are more unique to the business that you are running. For example, a chemical plant should plan for threats of contamination or injuries due to the equipment.

Step 3. Conduct an Impact Analysis of Your Business

The business impact study or analysis that you will conduct will attempt to predict the effects of business disruption that is caused by an emergency or a disaster, which will aid in the development of an effective recovery strategy for your business. To reiterate, it is pretty much impossible to exactly predict down to the tiniest action how a potential emergency or a disaster will affect the business that you currently run. One thing you can do, however, is to take whatever you’ve learned from the assessments you’ve performed to determine what disasters or emergencies are most likely to affect your business and what the effect looks like.

Step 4. Write the Business Emergency Action Plan

After completing the lengthy process of planning, you already have an idea of the potential risks that your business can face as well as their impact. You should also have enough information on what the plan should include. So now is the time to actually start writing the business emergency action plan. Since creating this document will involve collaborating with other company leaders, the HR department of your business, and local/governmental resources, it will be a time-consuming task. The elements of the action plan are listed earlier in this article.

The overall goal that you should set in creating the emergency action plan should be that it is clear, actionable, and well-organized. The action plan should provide as much detail as possible, while also allowing the appropriate personnel to quickly access all the information that they need in any given scenario.

Step 5. Perform a Review and Test the Plan

The process is not completely finished yet after you’ve written your business emergency action plan. After writing, go over the plan with your business leaders and put it to the test. You can schedule a business meeting to talk about emergency preparedness, walk through the plan with corporate executives, get feedback, and discuss it. After you’ve taken this step, you can have a more hands-on approach by conducting drills, tests, and seeing how your business performs in planned scenarios. You can also use this time to introduce the plan to your employees, begin the training process, and seek feedback on how the plan is working and what can be improved.

Step 6. Identify Areas of Improvement and Refine Your Plan

You should be able to identify the areas in which your business emergency action plan can be improved as a result of the meeting you conducted with the business executives. Also, at this stage, you should figure out the ways on how to tweak the strategy to address the areas of improvement and fine-tune the document that you have created. It is also critical to remember that your business emergency action plan should be a document that is constantly evolving. The emergency and disaster action plan will most likely change as the company grows and changes. As a result, you’ll want to thoroughly train your team after the document has been created and you’ll also want to make sure that updates are constantly provided as the procedures constantly change.


Should you alert the authorities to any kind of emergency?

In most scenarios, workplace emergencies can necessitate having to call the appropriate authorities, such as the fire and rescue department, emergency medical services, or the police department. It is also important to designate someone in the workplace to make the call to the authorities should an emergency arise. With that being said, an effective emergency action plan must also list all the emergency numbers from external help so they can easily be contacted whenever they are needed.

During an emergency, should you stay in place, or should you evacuate outside?

In most emergencies, evacuation from the site is the most ideal action that you can take. However, there are certain emergencies such as chemical, biological, or radiological contamination that would require all personnel to stay indoors since this is considered a safer option compared to totally evacuating the building. This option of handling emergencies is called a shelter-in-place option. When selecting a room that should be used as a shelter-in-place option, make sure that the room has little to no windows and has adequate space for every person who works in that company.

What are the categories of workplace emergencies?

Here are the three categories of workplace emergencies which can affect your company’s business operations:

Emergencies Outside the Building – this refers to weather-related emergencies and natural disasters, such as typhoons, earthquakes, tornadoes, and hailstorms. These kinds of events have varying levels of warning and danger, so it is important that all workers know how to deal with them.

Emergencies Within the Building – this refers to emergencies that occur inside the workplace, such as power outages, fires, or an active shooter or criminal in the building. The main goal of dealing with this emergency is to get everyone out safely. Having a good knowledge of the workplace and the evacuation routes is essential for the staff to anticipate any unforeseen detours during evacuation.

Health Emergencies – this refers to emergencies that are related to someone’s health, such as heart attacks, seizures, getting injured in the workplace, broken bones, etc. Depending on the severity of the emergency, local emergency services may be contacted.

Preparing for an emergency that can happen in your company is naturally time-consuming and a very tedious process. Taking the time to create an effective emergency business action plan will put your business on the best possible platform to survive in the long term. It’s also not wrong to continuously hope that you should never arrive in a situation that necessitates the use of this document in the first place. In this article, examples of an effective business emergency action plan are posted so that you can have something to use as an example in case you need to create one.