FM Global

Property Loss Prevention Data Sheets 10-5

May 2007
Page 1 of 8

DISASTER RECOVERY PLANNING

Table of Contents
Page

1.0 SCOPE .................................................................................................................................................... 2

1.1 Changes ........................................................................................................................................... 2
1.2 Superseded Information ................................................................................................................... 2
2.0 LOSS PREVENTION RECOMMENDATIONS ........................................................................................ 2
2.1 Introduction ....................................................................................................................................... 2
2.2 Mitigation .......................................................................................................................................... 2
2.2.1 Staffing Recommendations .................................................................................................... 2
2.2.2 Risk/Incident Identification ..................................................................................................... 4
2.2.3 Strategy Development and Implementation ........................................................................... 4
2.2.4 Test, Exercise and Maintain the Program .............................................................................. 5
3.0 SUPPORT FOR RECOMMENDATIONS ................................................................................................ 6
3.1 Plan Development ............................................................................................................................ 6
3.2 Loss History ...................................................................................................................................... 7
4.0 REFERENCES ........................................................................................................................................ 7
4.1 FM Global ......................................................................................................................................... 7
4.2 Other .................................................................................................................................................. 7
APPENDIX A GLOSSARY OF TERMS ........................................................................................................ 7
APPENDIX B DOCUMENT REVISION HISTORY ........................................................................................ 8
APPENDIX C BIBLIOGRAPHY .................................................................................................................... 8

List of Figures
Fig. 1. Phases of Response .......................................................................................................................... 6

List of Tables
Table 1. Disaster Recovery Team (DRT) Composition and Contacts ............................................................ 3
Table 2. Incidents and Responsibilities .......................................................................................................... 4
Table 3. Internal and External Resources ...................................................................................................... 5

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10-5 Disaster Recovery Planning
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1.0 SCOPE
This data sheet provides guidance for the development of disaster recovery plans to ensure that viable
recovery strategies are in place when disaster strikes. The intent of a disaster recovery program is to
document the process for restoring critical business functions to a state of normal operations following a crisis
or a declared disaster.

1.1 Changes
This is the first publication of this document.

1.2 Superseded Information

There is no superseded information in this document.

2.0 LOSS PREVENTION RECOMMENDATIONS

2.1 Introduction
The main goal of the disaster recovery plan is to establish guidelines to resume or recover specific essential
operations, functions, or processes. In addition, the program would assist corporate management to focus
on their established yet separate business continuity plans for the uninterrupted provision of the company’s
overall strategically important business operations and services.
The focus of an effective disaster recovery plan will be on expediting the following actions:
• Assessing the damage incurred to the facility
• Implementing damage control activities
• Recovering business operations.
This document addresses the general requirements of a disaster recovery program in response to an
identified risk at any facility. The disaster recovery program is an extension of the emergency response plan.

2.2 Mitigation
In developing an effective disaster recovery program, complete the following:
• Identify and document a Crisis/Incident Management Team (CMT/IMT) and a Disaster Recovery Team
(DRT) for the facility.
• Develop detailed emergency response procedures to include:
1. A nearby Emergency Operations Center location, suitably stocked with communications equipment
and recovery materials;
2. Actions required to restore normal operations to pre-incident levels within the shortest time possible;
3. Maintain principles of security (personnel, physical, and information); and
4. Implement actions for salvage, loss containment, and restoration.
• Test, exercise, and maintain the plan.

2.2.1 Staffing Recommendations

2.2.1.1 The Crisis/Incident Management Team is responsible for managing the incident. The Crisis
Management Team is normally, but not necessarily, comprised of senior managers from the company. The
CMT is responsible for:
• Deciding whether a disaster is to be declared
• Adapting the plan to account for prevailing circumstances
• Prioritizing the recovery of business functions so as to minimize the impact
• Initiating, controlling, and coordinating the local recovery operations

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Disaster Recovery Planning 10-5
FM Global Property Loss Prevention Data Sheets Page 3

• Reviewing critical milestones during the recovery process

2.2.1.2 The Disaster Recovery Team is given responsibility for implementing the plan at the site level. The
Disaster Recovery Team is comprised of assigned personnel with backup. Determine the roles and
responsibilities of the DRT as follows and where applicable:

Table 1. Disaster Recovery Team (DRT) Composition and Contacts

Function Roles and Responsibilities
DR Team Plan Coordinator • Take charge of the incident.
and Backup • Coordinate activity with the emergency services.
• Support the CMT in the management of the incident.
• Report the following items to the CMT, who is primarily responsible for the
Organization’s Business Continuity Plan: incident details, non-operating processes/
equipment, safety concerns, and emergency efforts taken since the onset of the
disruption.
Fire Protection System • Ensure the fire protection sprinkler systems (control valves, pumps, etc.) are fully
Coordinator and Facilities functional and in good working order.
Personnel • Verify that control valves remain open until authorized to be closed by a
responsible incident officer.
• Verify that all suppression systems are functional and have not been
compromised.
• Report any system malfunctions to DRT plan coordinator.
Hazardous Material Coordinator • Ensure all hazardous materials and ignitable liquids are safely secured and do
and Personnel not pose any threats to facility.
• Ensure all safety combustion guards on critical operations are functional and
have operated as designed.
• Report any safety malfunctions of operation processes to the DRT plan
coordinator immediately.
Facilities Coordinator • Retrieve building as-built plans and documentation to assist emergency
personnel with disaster mitigation.
• Coordinate pre-planned hot, warm, or cold disaster recovery sites to maintain
operation of facility as needed.
Media, Marketing, and Public • Collect damage information and details of incident.
Relations Coordinator • Report all incident information to plan coordinator.
• Direct all inquiries related to the incident to the organization’s media
spokesperson.

2.2.2 Risk/Incident Identification

Each facility is susceptible to common threats and risks that could impact the production or service abilities
of that facility. Using the table below, identify those risks the facility is most susceptible to and verify that
the actions/responsibilities that can mitigate the losses associated with that risk have been reviewed and can
be implemented:

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10-5 Disaster Recovery Planning
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Table 2. Incidents and Responsibilities

Fire and explosion risks • Employee evacuation plan is in place.
(including arson) • Emergency Response Team is active and on call.
• Communication equipment, such as radios, alarm transmission equipment, cell
phones is fully functional.
• Sprinkler system protection is not impaired.
• Fire walls are not compromised.
Natural hazards, such as flood, • A flood emergency response plan (FERP) and basic emergency response plans
windstorm, earthquakes, and roof have been established.
collapse • Flood protection barriers are available.
• Building construction reinforcement material for roofs and windows is available.
Service interruption, such as gas • Backup power sources, such as batteries, UPS systems, and generators are
or electric power outages functional.
Hazardous material incidents • First aid stations are fully stocked.
• Decontamination equipment is functional and available.
• Ventilation systems are functional and ready to shut down if so directed by
emergency personnel.
Vandalism, burglary, and terrorist • First aid stations are stocked.
attack • Security system logs are secured.
• Fire and burglary alarm systems remain operable.

2.2.3 Strategy Development and Implementation

Establishing an effective disaster recovery plan can be complex and may require tremendous effort to
implement, depending on the nature and size of the facility. It is an ongoing process that must always be
kept up-to-date as operations, processes, equipment, and people change. When reviewing an established
disaster recovery plan, document the following:
1. Identify alternate processes both upstream and downstream that could be implemented if critical functions
or equipment are compromised or fail. Maintain critical spares for important machines.
2. Review internal emergency response plans and policies as they pertain to the following:
• Evacuation plan • Employee manuals
• Fire protection plan • Hazardous materials plan
• Safety and health program • Process safety assessment
• Security procedures • Plant closing policy

3. Depending on the size of the organization, the DRT and the CMT headed by the plan coordinators meet
with outside groups to discuss and plan for potential emergencies and available resources for responding.
Consider the fire service, police department, electric utilities, public works, national weather service, and
telephone companies.
4. The DRT and CMT must discuss and put in place internal and external resources needed for emergency
recovery, such as personnel, equipment, facilities, and funding. See Table 3 for examples to consider:

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Disaster Recovery Planning 10-5
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Table 3. Internal and External Resources

Personnel • Hazardous materials response team
• Fire emergency response team
• Security
• Public information officer
Equipment • Automatic sprinkler system
• Suppression system
• Communication equipment
• First aid supplies
• Emergency power equipment
• Decontamination equipment
Facilities • Emergency operating center
• Shelter area
• First aid stations
• Media briefing areas
Funding • Cost and liability connected with using the involved resources

5. Identify the physical protection in place for key processes (e.g., automatic sprinkler protection, gaseous
protection, interlock systems, etc.)
6. Identify where specialist help and other alternatives can be considered to get the operation back up , such
as hot, warm, or cold disaster sites, share-loading, new facilities, warehouses, equipment, people, etc.

2.2.4 Test, Exercise and Maintain the Program

Establish a test, exercise and maintenance routine for the disaster recovery plan. A disaster recovery plan
cannot be considered reliable until it is exercised and has been proven workable, especially since false
confidence may be placed in its integrity. Exercising the plan has a number of benefits:
• It verifies the plan is practical by modeling recovery from disaster conditions.
• It provides training for the staff with the operation of the plan.
• It provides a feedback process to ensure procedures are appropriate.
• It improves confidence for those taking part.
Do not underestimate the work required for testing, exercising and maintaining the plan. This process can
be labor intensive and affects a large variety of different people within the organization and its facilities. In
many cases, full testing is not practical due to the need to maintain normal business operations.
2.2.4.1 Once the initial recovery plan is in place within the facility, establish regularly scheduled meetings
for the DRT members.
2.2.4.2 It is the responsibility of the CMT to assess training needs for the recovery plan. If warranted, develop
a training curriculum at all levels within the organization to support the program.
2.2.4.3 It is also the responsibility of the CMT to prepare representative and suitably detailed disaster
scenarios. The best way to discover the inevitable deficiencies in any contingency plan is to test it. Include
specifics in the exercise such as dates, time, workload, political and economic conditions, accounting period
end, and concurrent activities.
2.2.4.4 Execute the disaster exercise or scenario with planned as well as non-planned drills. Consider varying
the scenarios from that published, for example by substituting key players.
2.2.4.5 Document and evaluate exercise results, adjusting the plan where necessary.
2.2.4.6 At all levels of the organization, establish a process whereby the CMT is informed of changes in people,
manufacturing process, and equipment.

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10-5 Disaster Recovery Planning
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3.0 SUPPORT FOR RECOMMENDATIONS

3.1 Plan Development

Comprehensive disaster recovery and business continuity plans for an entire corporation are developed
primarily at a corporate management level, with contribution from key location management as may be
appropriate. Corporate disaster recovery and business continuity plans (DRP & BCP) take into consideration
operations for all facilities and potential make-up capabilities between plants, other manufacturers, or
suppliers as they relate to the strategic objectives of the organization. Depending on the size of the
organization, it can be difficult for every facility to know the specifics regarding the disaster recovery plans
for that facility. If a disaster recovery plan has not been developed, the guidelines provided within this
document can be followed to help develop a comprehensive plan for that facility.
It is important to distinguish between an emergency response plan, a disaster recovery plan, and a business
continuity plan. Emergency response is normally the initial part of the disaster recovery plan (how the local
personnel respond to an event in the minutes to hours following an incident). A disaster recovery program
is an ongoing process for short term disaster mitigation that is more than a ‘reaction’ to an incident. A business
continuity plan is a comprehensive program to respond to an enterprise-level risk and address business
disruption to normal operations in the weeks-to-months that follow an incident. See figure 1 below to identify
the critical timeline for an incident management plan in general and a disaster recovery plan specifically.

Fig. 1. Phases of Response

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Disaster Recovery Planning 10-5
FM Global Property Loss Prevention Data Sheets Page 7

Although plans should be tailored to the particular facility, and no two plans are the same, there are a number
of key components to incorporate into all plans. Among the more important include:
• A crisis or incident management team (CMT or IMT) responsible for providing the strategic decision-making
direction and appropriate notification to internal management, and for expediting recovery of operations
to pre-incident conditions.
• A site disaster recovery team responsible for providing early assessments on the incident and advising
the CMT/IMT on necessary damage control actions, expediting recovery and liaising with emergency
authorities.
• A media spokesperson who, with the CMT/IMT, will ensure a positive commentary is delivered to the public,
company staff, customers, and other interested parties.
• An initial response plan that will ensure appropriate notification and action by first responders. The plan
will need to include contact details in a “Call-out Tree‘‘ for key staff.

3.2 Loss History

In the aftermath of an emergency, whether it is a natural disaster or an unforeseen crisis, physical destruction
or damage to structures, production lines, and inventory are the obvious perils. Less easy to capture is the
negative impact on employee productivity, customer retention, and the confidence of vendors, partners, and
customers. Every year, FM Global clients have millions of dollars in business interruption losses. While many
of these losses are mitigated due to contingency planning, many of the others are more severe than they
should have been because the client did not have a contingency plan. Proper disaster planning makes a big
difference.

4.0 REFERENCES

4.1 FM Global
Data Sheet 10-0, The Human Factor of Property Conservation
Data Sheet 10-1, Pre-Incident Planning
Understanding the Hazard publication, Lack of Equipment Contingency Planning (P0179)
Understanding the Hazard publication, Lack of Emergency Response (P0034)
Understanding the Hazard publication, Lack of Pre-Incident Planning (P0033)

4.2 Other
Federal Emergency Management Agency (FEMA). Standard on Disaster Mitigation Guide for Business and
Industry. FEMA 190, 2004 Edition.
National Fire Protection Association (NFPA). Standard on Disaster/Emergency Management and Business
Continuity Programs. NFPA 1600, 2004 Edition.

APPENDIX A GLOSSARY OF TERMS

Cold disaster recovery site: A disaster recovery service that provides space, but the customer provides
and installs all the equipment needed to continue operations. A cold site is less expensive than a hot or a warm
site, but it takes longer to get an enterprise in full operation after the disaster.
Emergency and Government authorities: This is a global term that represents public firefighters, water,
police, hospital personnel, and local government officials in any area of the world.
Hot disaster recovery site: In the context of disaster recovery, the definition of a hot disaster recovery site
is a redundant facility or a commercial disaster recovery service that allows a business or a facility to continue
its operations in the event of a disaster. For example, if an enterprise’s data processing center becomes
inoperable, that enterprise can move all data processing operations to a hot site. A hot site has all the
equipment and operations needed for the enterprise to continue its operation, including equipment, machinery,
storage space, office space and furniture, telephone jacks, and computer equipment.

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10-5 Disaster Recovery Planning
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Human Factor: Action or inaction that people take that directly affects on the probability for a property loss
incident to occur and/or affects the level of severity that an incident reaches. It can be a positive or negative
factor. The hazard of the human factor is directly proportional to the physical hazards and processes present
within a facility and inversely proportional to the level of preplanning, education, and training provided for
individuals in advance of the incident.
Mitigation: Actions taken or provisions made to eliminate or reduce the likelihood or consequences of an
event, either prior to or following a disaster/emergency.
Recovery: Activities and programs designed to return operations at a site to pre-incident levels as quickly
as possible.
Response: In disaster/emergency management applications, activities designed to address the immediate
and short-term effects of the incident.
Warm disaster recovery site: In the context of disaster recovery, a warm site can provide partial capabilities
with equipment, operation, storage, computer equipment such as servers, mainframes, and network
connectivity. The key concept to consider is the time required to restore a level of service. The closer to “real
time” this is, the “hotter” is the recovery site. However, this is rarely the case in manufacturing recovery
activity. Warm sites are most typical.

APPENDIX B DOCUMENT REVISION HISTORY

This is the first publication of this document.

APPENDIX C BIBLIOGRAPHY
Croy, Michael & Geis, James E. “Acronym Soup, BCP, DR, EBR –What Does it All Mean?”. Disaster Recovery
Journal, (Summer 2005); 24 – 26.
Holdburg, Greg. “DR vs. BC Dueling Recovery Plans.“ Disaster Recovery Journal’, (Spring 2005): 32 -34.

©2007 Factory Mutual Insurance Company. All rights reserved.