How to Budget for Disaster Planning

Planning for contingencies such as disasters is imperative to all businesses. In most organizations, the budget for disaster planning usually consists of two to four percent of the IT budget. Developing the budget is a time consuming process and requires meticulous detail in making sure you have the funds on hand to cover all scenarios and contingencies. You will need to identify all expenditures related to your disaster recovery plan, determine where the funds will come from, and create a disaster recovery checklist to ensure you cover all your bases. In the event of a disaster, the plan requires implementation to protect the business and the bottom line.

Instructions

• 1

  Identify all expenses related to your disaster recovery plan. Such expenses may include, but are not limited to, off-site storage facilities, utilities, rent, salary, payroll, related maintenance, software, hardware, and outside consulting for both planning and implementation. Review all data from the previous four years as well as previous budgets to determine where to allocate money and resources for the disaster-planning budget.

• 2

  Determine all assumptions to build into the budget. This includes likely disasters that may occur such as floods or storms and the total loss your business will likely suffer. Plan for the worst (within reason), and budget for it.

• 3

  Figure out where the funding for disaster planning will come from, whether from corporate headquarters, a particular department or multiple sources. Most companies pull funding from the IT budget for disaster planning because much of the disaster recovery planning relies on information technology. You will need to determine how much of the overall budget is necessary for continuing operations despite a disaster. Be prepared to justify all spending in the budget.

• 4

  Create a disaster planning checklist to determine where you need to allocate funding in terms of disaster planning, recovery and business continuity. This checklist should outline all budgetary line items including required training, management, emergency response and many others. This checklist will help you finalize the budget and know exactly what figures you are looking at and why. Make a quality template to help speed up the process, and include all the necessary budget items.

• 5

  Present your budget for approval to the board or the IT department, depending on how you decided to fund the disaster planning process. Prepare to defend the figures by emphasizing the soundness of the disaster recovery plan and the critical nature of business continuity.