Skip to content

Ask Lacerte: Preparing for Disaster with SaaS

November 24, 2009

This article previously appeared in the CPA Technology Advisor.

Imagine you are having dinner outside at a nice café in your
town.  You hear a fire truck racing
by, you look up and then continue your dinner.  Then you see not 1 more but 3 more coming from all the
neighboring towns.  Soon there is a
lot of commotion.  5 blocks away
there is a plum of smoke racing into the sky.  After the initial fear for loss of life, you realize that
the smoke is coming from the same block that your family business has been
operating out of for the last 70 years. 
You drop your napkin and run down the 5 blocks to find out that you are
safe.  It is not your building that
is on fire it is the building 2 doors over.  You think “Wow, I dodged that one” and go on home.

The next morning you go into work and after a few emails you
realize you need to go downstairs and get something out of the files.  When you open the door to go down into
the basement, you are shocked.  It
is full of water.  Apparently, the
fire next door took 2Million gallons to put out and much of it ended up in your
basement.  All the records that you
rely on to make your business run are now gone.  You no longer know what you paid  Tom the last time he did that brochure or what your contract
with “Big Company” requires of you. 
You realize in a heartbeat that this will be the most challenging time
in running your family’s business since your grandfather started it 70 years
ago.  You’re afraid that you’re not
up to it.  You’re afraid that the
business won’t make it.  You’re
afraid that in just one moment you lost everything that your family has worked
for for generations.

Pretty scary isn’t it. 
This actually happened to a friend of mine and it has affected their
business in so many ways.  She has
survived but it has not been without its sacrifices and challenges.  In the following 2 years, she would
close one store, sell inventory below cost, and work harder than ever before.

The department of labor estimates that 60 percent of
businesses hit with such a disaster close the doors within 2 years.   Think about that, when disaster
hits your clients you have a 60% chance of losing them.  Not because of anything you did or they
did but something out of anyone’s control.  

It doesn’t have to be that way.  You, as a trusted advisor, have the opportunity to influence
decisions and actions ahead of such a disaster.  Imagine if my friend’s accountant had influenced her to have
a disaster recovery plan.  It would
have been a few weeks of disruption but the business would not have been at
risk.  Instead of the accountant
facing a 60% chance of her going out of business and losing a client, my friend
would be telling all of her business friends about how her accountant saved her
business by forcing her to plan for just this moment.  So instead of the stress of a disaster, the accountant would
be busy managing referrals.  As a
businessmen and not an accountant, this is exactly the type of advice I expect
my accountant to give me. 

This issue is dedicated to giving you the tools to provide
lots of ways to help you help your clients plan for that awful moment of when
disaster strikes.  My objective in
this column is to stress the importance of planning and the value of
Software-as-a-Service when it comes to planning the disaster.

By definition “SAAS” solutions have a disaster recovery
advantage.  SaaS applications
leverage the Internet so that you can work from anywhere.  Everyday, this has advantages.  I do my work from the office, home, on
the road, or on my phone.  When it
comes to a disaster, this advantage can save your business.  It means that when a Hurricane, an
Earthquake, or a Tornado strikes you can leave town like you should and resume
work from the next state or town where it is safe and there is an Internet
connection.  

The other primary advantage of a best in class SaaS company
is that it thinks about disaster recovery and incorporates a strong plan into
the DNA of its company.  It is our
job and if we don’t do it clearly our business is at risk.  Core to every disaster plan is the backing
up of data and documents routinely. 
Most small businesses think they are doing great if they back up their
files once a month.  Best in class SaaS
companies have this built into their application.  We make it so the software and the data that drive the
application are backed up REALTIME in
different locations that are thousands of miles apart and not in the same
disaster zone.  In fact we make
sure they are on different Internet back bones and different power grids. That
means that as long as there is Internet, you and your clients will be able to
get to the tools you need to run your business.  Duplicating this capability for a small business is
prohibitively expensive from a cost and time perspective. 

How do you know if the company you are looking at is “best
in class”?  You should check the
background of the management team for prior successes where this would have
been part of their job, make sure they have strong investors that have backed
successful companies where this is valued and most importantly make sure they are
Sas70 certified by a reputable firm.    The SAS 70 requires that certain procedures be
in place including controls and security around any of the stated
operations.  The auditors have to
check that the procedures are followed so that the data is backed up at the
frequency stated.

As you consider adding or expanind your disaster recovery
consulting, please consider SaaS. 
There are SaaS applications for phone systems, accounting, document
management, bill management, payroll, tax preparation, inventory management and
pretty much everything you and your clients will need to run your business.

Finally, please don’t wait for the disaster to strike before
you see the benefit of developing a disaster recovery plan.  You clients are depending on you to
push them, to serve them and to protect them from such disasters.  I should know, I am one of them.

Rene

Advertisements
Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: