All organizations are susceptible to crises, including accounting firms. Normally, when business owners think about the effects of a disaster they envision large catastrophic disasters that affect an entire region. The truth is, there are many types of disasters that could severely impact your firm. We recommend that each of our members develop a comprehensive plan that ensures they are prepared to reopen their doors immediately after a disaster.
In this article we will discuss key components to include in a disaster plan. These strategies and tactics are specifically designed to minimize damage to the image of your firm and keep day-to-day business operations running.
Step 1: Crisis Communication Team
The first step in creating a comprehensive disaster plan is to assign a team the responsibility of putting the plan together. This may sound like common sense, but the makeup of your team will be vital to the effectiveness of your disaster plan. Also essential is assigning a specific role to each person. Each of these roles should have a defined responsibility to ensure accountability. For example, identify a spokesperson. The spokesperson may be responsible for determining the firm’s position, making statements to the media, clients, team members and other interested parties.
Step 2: Risk Assessment
The second step is to assess the various risks your firm is susceptible to. It will be helpful to identify the varying levels of disasters. Disasters come in a variety of forms. They can be violent, requiring an immediate reaction or non-violent, necessitating a delayed reaction. They can be sudden without warning or smoldering, building over time. Regardless of the type of disaster, one thing is certain – a stance must be taken. Under no circumstance is “no comment” an option.
The following are several examples of risks accounting firms are susceptible to and should prepare for:
- Cybercrimes – technology upgrades have opened new doors for streamlining routine processes. Unfortunately, taking these processes online is also opening new doors for cybercrimes. According to the AICPA, the top five cybercrimes are tax-refund fraud, corporate account takeover, identity theft, theft of sensitive data and theft of intellectual property.
- Unexpected Internal Departure – The sudden departure or death of a key team member can disrupt the day-to-day operations of a CPA firm. Do you have a succession plan in place? Are responsibilities evenly distributed? Are your team members cross trained?
- Disasters (Violent and Nonviolent) – Natural disasters come in many forms. They can affect a nation, region or community. They can be violent and require immediate reactions (hurricanes, tornados, floods) or nonviolent and require delayed reactions (drought, epidemic). They wreak havoc on accounting firms by interfering with project deadlines or compromising personally identifiable information.
- Litigation – Failing to follow professional standards can result in litigation, especially for accounting firms. For instance, failing to include disclosure language at the end of document, misusing client data or using an image without sufficient copyright are just a few scenarios that can put an accounting firm in a courtroom.
Step 3 – Identify Stakeholders
Who are your key stakeholders? In case of a crisis these are the people who will be affected and should be addressed in communications. Stakeholders can include:
- Employees (current, potential and past)
- Interns (current, potential and past)
- Clients (current, potential and past)
- Media (local and national)
- Influencers (bankers, attorneys, etc.)
Equally important is the manner in which you will communicate with each of these influencers. The method(s) you chose will depend on the influencer. For instance, the media may receive a press release while clients would likely receive a phone call or formal letter.
Step 4 – Establish Media Relationships and Policies
Controlling the message is essential in a crisis. Do not wait until disaster strikes to put together a local and national media list. Proactively reaching out to media and making an introduction now will help control the situation should a crisis arise. Communicating with the media in an untimely manner can result in misinformation from unreliable sources other than yourself. The media will not wait for you, they will look elsewhere for information if you cannot or will not provide it.
Establishing policies with the media will help maintain an organized process for handling media inquiries. For instance, identify specifically who media inquiries should be directed to. Will interviews be restricted to specific people?
Step 6 – Prepare Statements Now
Gaining and keeping control of a crisis depends heavily on the initial communication. The first statement must be timely and consistent. Having a pre-drafted message will speed up the process of communicating with publics. Remember “No Comment” is never an option!
While you are developing plans to keep your business running in a disaster, it probably makes sense to review your insurance coverage as well. Guarantee that you have a good handle on the risks for which you are covered. This will be vital to ensuring that your business is well prepared for any disaster. Additionally, you may find that you need to obtain other coverage to keep your business protected.
If you would like help developing a crisis communication plan or more information on any of the steps discussed in this article please call us for more information. We can help you develop a customized plan to meet your particular needs.