Are You Prepared?

One might assume that only the most hyper-vigilant of Twin Cities executives spend as much time planning for the prospect of natural disasters, power blackouts, or computer viruses as they do keeping costs in check, managing new marketing campaigns, or placating Wall Street.

In fact, according to a 2007 survey by AT&T, businesses in the Twin Cities are less prepared for both manmade and natural disasters than many other large cities. Minneapolis/St. Paul ranked ninth of 10 metropolitan areas in the survey of 1,000 information technology (IT) executives about their companies’ disaster preparedness, including for telecommunications outages.

But despite that telling statistic, a number of factors have spurred area business leaders to begin planning for the loss of telecommunication function. Regulations such as the Statement on Auditing Standards Number 70, which was developed by the American Institute of Certified Public Accountants, requires companies to maintain more internal control over IT services outsourced to third-party providers. Industry-specific directives like the Health Insurance Portability and Accountability Act, which obligates health care providers to protect health information and data privacy, have persuaded local organizations to take “worst case scenario” planning for telecommunications more seriously.

Good business continuity and disaster recovery planning, or BCDR, also is an issue in business-to-business markets, says Gary Doty, regional vice president of Time Warner Telecom, a Colorado-based telecommunications company with offices in Minnetonka. “It’s not necessarily just a regulatory compliance or investor compliance issue, because in order to provide product or services to other companies, you often have to show good BCDR as part of your business strategy,” he says.

“Larger companies are handing their smaller suppliers an audit sheet and saying, ‘We want to see what your BCDR plan is, and how you’ll continue to provide product or service to us in the event of an outage,’” adds Steve Bult, senior project manager for Technology Management Corporation, a technology consulting company in Shorewood.

“I think awareness of the need for disaster recovery planning is high in area companies, but the call to action isn’t always realized,” says Greg Kenfield, a senior sales manager for XO Communications, a communication-services provider in Minneapolis. “I equate it to anti-virus software or most forms of insurance. Until something happens, you often don’t realize what you’re paying for. But when you get that computer bug or a building is hit with a natural disaster, having redundant communication lines and data properly replicated in secondary data centers will seem well worth the investment.”

Downtime Difficulties

Some industries clearly are more vulnerable to disruption than others. In banking, health care, and government, for example, where even the temporary loss of communication function or access to mission-critical data can have wide-ranging impact, disaster recovery planning takes on greater importance.

In other cases, it can depend on how “customer facing” an organization or unit might be. If a manufacturer in the middle of a supply chain isn’t available for a few hours following a disruption, and has to wait a day to resume shipping, the impact on business won’t be as great if, say, a large call center’s network goes down and customers calling or e-mailing it can’t get through for hours.