Disasters: Take me to your leader, Part 2

Published on: 
03/17/2016
In honor of Presidents' Day last month, I began a two-part look at leaders of law firms and how they should solidify their legacies by fulfilling their responsibilities in terms of disaster planning.

Part I, which appeared in the Feb. 29 issue, examined two positions responsible for protecting a firm's personnel and information. This part will offer advice to those in the firm who must protect the financial assets and physical facilities, meet the firm's commitments, and coordinate the plan.

Click here to read Part 1.

3) CFO: Protect your financial assets

  • Review (or establish) your insurance coverage. Insurance is a central aspect of disaster planning and recovery. Understand the fine print. Your policy should be tailored to your specific practice. It should cover damage to or loss of real and personal property, loss of revenue, general liability, reconstruction of destroyed documents, and extra expenses related to a disaster or catastrophe.

  • Review claims procedures before the need arises.

  • You will undoubtedly need to disburse funds for rent, payroll, settlements and so forth. A disaster will likely interrupt work in progress and continuing practice development, so give the collection of existing accounts receivable top priority.

  • Arrange automatic funding on an emergency line of credit, separate from operating lines of credit.

  • Establish a solid relationship with your banker. Maintaining close contact with your bank will help if you need an emergency loan.

4) Facilities manager: Protect the physical facilities

  • Create a complete inventory and photo document your entire office with all of its contents (before and after) to prove losses.

  • Protect valuable physical assets (artwork, library contents, etc.).

  • Plan for temporary space. Contingency space-planning ranges from a temporary control center for your disaster recovery team to finding temporary office space for transferring the entire firm. Contact building managers and real estate agents in advance to establish contingency.

  • Work with the CIO to arrange access to compatible computer equipment. Consider a reciprocal arrangement with another firm that uses similar computer, accounting and litigation-support equipment.

5) Managing partner: Meet the firm's commitments

  • Conduct a law firm risk assessment. Analyze the possible consequences of a disaster. Review your current state of readiness by looking for weaknesses. Review your insurance policies, alternative worksites, and information and document storage. Bear in mind that different practice groups may have different requirements.

  • Have a plan for returning to business as usual. A critical responsibility of a law firm after a disaster is to resolve or move along all current cases or work in progress. You may need to get continuances or reschedule depositions. You might need to refer some or even all cases to another firm. Are the case files current and accessible?

  • Have a written succession plan. Should the firm lose rainmakers or key managers, a clear succession plan can help the firm survive and smooth the transition.

6) Executive director: Coordinate the plan

  • Prepare a specific disaster-recovery plan manual. Spell out exactly who does what. Create disaster-recovery teams to support the accountable senior managers identified in the plan.

  • Identify the committee members to all staff and to the building managers. Regularly convene the committee to review the manual, revise the procedures, and do a run-through.

  • Put the plan to the test. Merely creating a plan on paper is insufficient. Every six months or so, the firm must pretend that there is a disaster and seek to implement the elements of the plan. Then change those facets of the plan that didn't work as well as desired.

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