What’s in YOUR Disaster Recovery Agreements?

By Pat McGrew / Published:

Disaster Recovery and Business Continuity Plans are part of your company’s risk management. When executed well, they provide the confidence required to face disasters in any form. As important as the documentation of processes, procedures, and assignments are, an essential set of investigations is often overlooked: the requirements embedded into agreements with vendors who support your business. To avoid miscommunication and finger-pointing, look at the agreements you have and document the obligations required of your teams and your vendors.

Before we look at hardware and software agreements, look at your insurance. Business insurance policies have changed in recent years to draw tighter boxes around what is covered, what is partly covered, what is not covered, and deductibles. Many companies who had to close during the pandemic were told that their business continuity policies would not cover them because the pandemic was not a physical loss. Companies that have lost access to their buildings due to nearby fires or other events but did not touch their building experienced some of the same lack of access to insurance relief. Take the time to understand what is covered, at what level it is covered, and your responsibilities for reporting as well as tracking your costs to operate away from your home building.

Thinking About Your Hardware

Hardware acquisitions often focus on price and service agreements. You want to be sure that you understand all costs associated with operating a piece of equipment, especially production equipment that contributes to the cost of goods sold. But there is also other equipment in your business, like:

  • Office equipment: Laptops, copiers, printers, phone systems, postage meters, fax machines
  • Kitchen/Breakroom equipment: Refrigerators, coffee machines, vending machines, microwaves

Office equipment may be purchased as an expense, but some organizations have fleet management agreements for computers, printers, and other business communication systems. If you buy your equipment, consider your plan for continuing business if you can’t get back into the building. If you lease equipment, what does your agreement say about temporary access to devices at a new location or replacement in case of a total loss?

Breakroom equipment is likely the least of your concerns but understanding your responsibilities for any equipment that is leased or placed by a vendor in return for the sales opportunity is important, too.

Now turn your attention to production. This is the heart of your business. You may have a single press, some color management tools, and a single folder, or you may have a compendium of equipment to meet an expansive catalog of print products. Some equipment may be owned, and some may be leased. Some may have maintenance agreements, while others are maintained by an internal team. Begin by understanding what you own and what you lease and then review every agreement. Here are some things to look for:

  1. Does the vendor offer access to a hot or cold site that you can use if you lose access to your facility? If they do, is there a daily charge, and what are your obligations?
  2. Will the vendor suspend lease, maintenance, and other payments for the duration of your declared disaster? Are there limits to how long they will suspend?
  3. Will the vendor fast-path orders if you need to replace equipment?
  4. Will the vendor haul away unrepairable equipment?
  5. If you cannot restart business, what are your agreement termination options and obligations?

Also, remember to read the fine print! These things are important to know and internalize before an event happens. Ideally, copy the relevant passages of your agreements to a document that becomes part of your Disaster Recovery plan, and ensure it can be accessed in case you need to put the plan into motion.

Thinking About Your Software

Software comes into the business through a variety of paths. You might have software bought off-the-shelf, like Microsoft business products, common preflight software, or other tools. You might have software acquired through a relationship with a vendor. This is often the case with Print MIS, ERP, MES, and end-to-end workflow automation suites, as well as mailing services and shipping management tools.

For off-the-shelf software that needs to be replaced to carry on operations, the shortest path is to buy what you need, keep receipts, and carry on. Remember that Office 365 products can often be re-downloaded, but you may need the license keys. The same is true for most security software that covers laptops and desktops.

For production software, read your agreements carefully to see if licenses are portable to a new location and a new set of servers for on-premise tools. For cloud-based solutions, review your options for accessing the solution for alternate locations. It is worth scheduling a conversation with your provider to review your DR plan and verify your understanding of how you would work with them in case of a disaster.

Thinking About Your Suppliers

In addition to your hardware and software, you work with substrate suppliers, ink suppliers, and others who supply pallets, shop cloths, shrink wrap, packaging supplies, and the rest of the accessories you need to run your business efficiently. Don’t forget about them! Your agreements with them should also have clauses related to your obligations in case of a disaster. Consider these questions:

  1. How do you turn a service off? Cleaners, shop cloth delivery, and other regular deliveries will need to be stopped or diverted.
  2. How do you notify substrate and ink suppliers if you need to stop or divert deliveries?
  3. Some agreements have timeframes and other obligations that define the relationship. It might be how much paper you will buy or how often you will replenish other consumables. Not every supplier will automatically understand your situation, making written agreements important.

The best practice is to understand the agreements you have. While some vendors may recognize the challenges of a disaster, others may not. Don’t leave it to chance. Read your agreements, review them with your legal counsel and vendors so that everyone is on the same page. Disasters don’t appear by appointment! This is a lot to digest. Have questions? Put them in the comments or send an email.

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About the Author

Pat McGrew

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Pat is a well-known evangelist for inkjet productivity. At McGrew Group, she uses her decades technical and marketing experience to lead the industry toward optimized business processes and production workflows. She has helped companies to define their five-year plans, audited workflow processes, and developed sales team interventions and education programs. Pat is the Co-Author of 8 industry books, editor of A Guide to the Electronic Document Body of Knowledge, and a regular contributor to Inkjet Insight and WhatTheyThink.com.

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