traditional assets

Protecting traditional assets isn’t enough

Protecting traditional assets is one of the most important duties of a business owner. You’re constantly taking steps to deal with the need to protect and maintain your assets including buildings, cash flow, receivables, furniture/fixtures/equipment (FFE), etc. You have insurance, attorneys, maintenance contracts and any number of other processes, mechanisms and protections in place to sustain the value of the things you’ve invested in, and in some cases, to keep you out of trouble.

Yet despite all that effort and all that expense, I encounter at least one sizable business leaving themselves at significant risk… every single week. However, I don’t mean about FFE and other hard assets. There are at least two other assets worth protecting – and they’re as important as the ones you spend plenty of time, effort and money protecting. While you might be able to think of other assets that need protection, I’m speaking of work-in-process and data.

How do you protect work-in-process?

Every small business knows the pain of trying to get work out the door when they’re sick or an employee has to call in sick – or quits. The smallest of businesses, such as those with no staff, have to suck it up and deal with it. Sometimes this means having to tell their client(s) that they can’t deliver on the previously predicted schedule. Even when they deliver a little bit late, it plants a seed with that client that their vendor might unintentionally put them at risk by being unable to deliver at some random time in the future. If Murphy has his way, the timing won’t be ideal.

While many businesses do cross-training, the most resource-constrained ones struggle to make the time to do so. The resource-constrained small business isn’t the exception, it’s often the rule. While you might have plans in place when losing a “key employee”, that isn’t necessarily what causes the pain. It isn’t necessarily about losing your best welder, hairstylist, millwright, programmer, salesperson or finish carpenter. What gets hurt is what they’re doing when they depart, whether the departure is permanent or temporary. Do you have people sitting around who can simply step in and take over without missing a beat?

In most cases, that isn’t reasonable.

A salesperson who has been working a deal for months is tough to replace. They’ve established rapport with the decision makers. Starting over is likely to delay closing that deal. A hairstylist has the same kind of rapport and trust established with their 20 best clients. Your best welder may not be able to take over a job that someone was doing because they are backed up, or they aren’t used to working under water, or they can’t leave town to work due to their family situation. Your best programmer is unlikely to step in and immediately do their best work on code they’ve never seen on a subject matter they might know nothing about.

There isn’t a magic wand to these kinds of problems, only hard, important work. There’s documentation, cross-training and meetings (yay!). It probably seems normal to ask your best players what they’d recommend in these situations, but don’t forget to ask everyone else so nothing is missed. Who do they think can take over? Who needs to be cross-trained? What processes need to be excruciatingly documented? Talk about it and plan for it as best you can before the uncontrollable happens.

It’s time to treat data as one of your traditional assets

I see data at risk on a regular basis. The maintenance and protection of data and computing equipment is often left to the end user – who is all but certain to have no experience in such things, or will not have the tools (or time) to do the job. I regularly hear from businesses who were held hostage by ransomware, by systems with no anti-virus, or by hardware failure. Years back, I had a bank client that hadn’t backed up in over five months. How did I know? The ONE backup tape they had was dated five months earlier. It was damaged.

Can orders be filled without order data?

People ask me how often they should backup. I usually respond with “How much work can you afford to re-do?” It isn’t a flippant question. Can you afford to pay your staff to redo everything they did last week? Yesterday? The last two hours? What delay can you afford?

Photo credit Rita Willaert

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