Business Continuity Planning: An Empirical Study of Factors that Hinder Effective Disaster Preparedness of Businesses

In a disaster, lives can be lost, property and equipment destroyed and business operations come to a standstill. According to the Insurance Information Institute, 40% of small businesses never reopen after a disaster; only 26% of small-to-medium size businesses have a disaster plan, and 75% of the largest segment of business does not have a disaster plan. Disaster preparedness describes measures that minimize the adverse effect of a hazard on life, property and livelihoods. The study revealed that real-world events increase awareness and impel businesses to act; disaster threat on businesses has not translated into a plan; measures taken have mostly focused on data storage and Internet security. Perception of high cost, lack of staff, inadequate information, apathy and low priority accounted for the reasons why businesses fail to plan for a disaster. There exist barriers to effective disaster preparedness which has significant effect on business continuity. Keywords: Business continuity planning, Disaster, Disaster preparedness, Disaster preparedness plan, Disaster risk reduction