NEW YORK-A key lesson was learned during 2012's Super Storm Sandy that credit unions should heed when planning for 2014.
"Contingency planning and business continuity planning are important," said Jason Moses, manager, implementation services at FI Compliance Solutions. "Sometimes that can be overlooked, and that is of key importance, because ultimately if something happens that's out of control of the credit union, there has to be sound, efficient processes in place where they can have no continuity problems within the organization."
CUs throughout the Northeast experienced that firsthand last year when Super Storm Sandy hit, leaving credit unions in New York and New Jersey (among others) scrambling to serve members while also figuring out continuity plans on the fly.
Moses noted that many institutions-particularly smaller ones-don't have contingency planning in place because "they don't necessarily want to allocate the funds or the manpower to building those business continuity plans or using an external company or software vendors to help them in that process."
"Either they're looking to cut costs or they feel that they can get by without it on some level. Whether you're a large organization or a sub-$100 million organization, you should have a sound business continuity plan in place. That's essential. Sometimes this can be an oversight, but if something does happen, what's the next step? You could be left out in the dust, and that's a big problem."
The Back-Up Plan
As far as specific strategies for business continuity planning, Moses stressed the importance of doing a business-impact analysis, including having a thorough understanding of the institution's back-up systems so data won't be lost in an emergency.
Additionally, he said, back-up offices are crucial-a lesson that many CUs learned after Sandy.
"That's key to any contingency planning process: where's our back-up facility and how are we backing up our systems?" he said. "If those two things are in place, then you're heading in the right direction-but so much more goes into it, and a lot of it relates to cost and how you allocate your resources."
Moses said that strategies beyond back-up location and backing up data are often specific to individual CUs and declined to speak more broadly.
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