Blog Post

When Disaster Strikes – Three Top Reasons a Contingency Plan is Critical


Guest author Kevin Lenahan, Chief Information Officer for Apex HCM

Prolific inventor, political humorist and founding father Benjamin Franklin said it best: “By failing to prepare, you are preparing to fail.” If your payroll or human resources firm lacks a contingency plan that guarantees  continuity or quick recovery in a catastrophic event, then you, too, are setting your business and potentially your clients up for failure. Consider these statistics:


  • 30% of businesses are inadequately prepared or have no disaster recovery strategy in place.
  • 90% of businesses without a disaster recovery plan will fail following a disaster, according to a study by accounting firm Touche Ross.
  • One in three businesses that experienced a disruptive event was inadequately prepared despite having a plan in place, a study by IT provider StorageCraft showed.
  • 35% of companies lose at least one business-critical app in disruptive events
  • Unplanned downtime costs the average company between $926 and $17,244 per minute.


If you’re business has never been hit with a major disruption, consider yourself lucky.  Here are three most common  catastrophic events:


  1. Disasters: Atlantic Coast hurricanes, Great Plains tornadoes, West Coast earthquakes – Even if buildings escape unscathed, power outages can prove a potent threat, accounting for some 35 percent of all unexpected downtime. And keep in mind that non-natural disasters, such as fires, can happen in any geographical area at any time.
  2. Hardware failures: While disasters may prove most catastrophic, hardware failure actually is the leading cause of all unplanned downtime – some 45 percent. Common culprits are faulty network switches or server drives. Often, the issue is a simple fix, but can have major implications with every minute of downtime that continues while technicians identify and correct the failure.
  3. Data breaches: No doubt you’ve heard about the millions of customer accounts  compromised in cyberattacks against Yahoo, eBay, Equifax, Target, Uber and Home Depot over the past few years. If you believe your firm is well off a hacker’s radar just because your small or your client list is modest, you’re sorely mistaken. After all, data required to facilitate employee pay and benefits is just the type of information that data hackers seek In its most recent annual review, California’s Identity Theft Resource Center revealed that the number of US data breaches tracked throughout 2017 hit an all-time high of 1,579 – up 44.7 percent over the 1,091 breaches identified in 2016.


Developing a solid contingency plan tailored for payroll and HR firms is just one of the many mission-critical subjects addressed at the upcoming Apex users conference, Align 2018, September 20-21 in Atlanta.  Kevin Lenahan, Chief Information Officer, will co-present a session on CyberSecurity with Jennifer Scotese, President, Express Data Systems.  To register for Align 2018 click here.


This blog post is guest authored by Kevin Lenahan, Chief Information Officer, Apex HCM. Kevin would love to hear your feedback or answer your questions at