Preparing For The Worst

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Entrepreneurs
Preparing For The Worst
Maureen Farrell, 09.17.07, 6:23 PM ET

There is no crying in baseball, and there are no "sick days" when you run your own business.

Still, there are plenty of ways entrepreneurs can get sidelined--from sudden illnesses and travel delays to pregnancy and military duty. Without a well-defined plan, those leaves of absence can pose a dangerous threat.

"If something incapacitates you, it can be the death knell of your business," says Karla Leavelle, president of Human Capital Advisors, a McLean, Va.-based consulting firm that counsels small businesses.

How do you hedge the risk of lost leadership? Business insurance doesn't help. Property and liability coverage come in handy in case a customer slips and falls in your store or gets hurt using one of your products, and business-interruption insurance covers operating losses if a hurricane reduces your building to rubble.

If you really want things to run smoothly in your absence, you need other protection in place. Here are some tips:

Have A Point Person

Be it the chief operating officer, outside counsel or even a trusted executive assistant, at least one person should have access to everything that keeps the place running--including passwords, bank account numbers and keys to safes. You might even consider handing over power of attorney in your absence.

Doling out that kind of trust isn't easy, but if something goes wrong while you're gone, you'll wish you had. "Owners are always scared that someone is going to steal secrets of the organization," says John Vyhnanek, a restaurant consultant in Boston. "It's a bit like walking a tightrope, but someone has to keep the business going if you can't be there."

Vyhnanek learned that lesson the hard way as owner and head chef of the old Harvard Street Grill in Brookline, Mass. While he hadn't logged a sick day in 10 years, Vyhnanek hadn't shared his food-preparation techniques with anyone either. (There was an assistant chef, but he only knew his way around appetizers and desserts.) One day, the odds caught up: Felled by the flu, Vyhnanek closed the restaurant on a Saturday night, leaving bills for 90 dinners on the table.

"It didn’t make us go under, but [it] made paying bills tough for a few weeks," he says.

Build A Detailed Org Chart

In grainy detail, map out the work flows in your organization. Identify who does what and who can take over certain roles if need be. Start by having employees write out their own job descriptions and the list of activities they do on a daily basis.

"No one can duplicate the charisma of an entrepreneur," says Louis Celli, head of the Northeast Veterans Business Resource Center, which mentors military entrepreneurs. "But if the entire business is systematized, that can sustain the business until the entrepreneur returns."

Better yet, if you codify thoroughly and thoughtfully enough, you might even discover ways of making your business run more efficiently day to day.

Form Partnerships

If you own a medical, law or accounting practice, your clients simply can't wait for you to return. That's why you should draft a written agreement with a local competitor who can cover for you in the event of an emergency (and visa versa).

Hammer out the tough questions upfront, such as referral fees--both for your clients and any they might refer to your stand-in. You'll also want to make sure the fees are comparable, lest your clients blanch at getting a fatter bill than they are used to.

Go Mobile

Even if you aren't a gadget guy or gal, if you run your own business, you have to have access to critical clients and information at any moment.

Addictive as these devices can be, you probably need a personal digital assistant. While Apple's (nasdaq: AAPL - news - people ) Newton flopped back in 1993, PDAs are everywhere now. The popular BlackBerry, made by Research in Motion (nasdaq: RIMM - news - people ), runs $100 to $500. You'll also pay about $100 a month to a service provider such as AT&T; (nyse: T - news - people ) or Verizon (nyse: VZ - news - people ), though you can save a few bucks by bundling the connection with other phone or Internet services.

Want access to all your files from your hospital bed? No problem. For another $20 a month, companies like Citrix and New Moon Canaveral IQ will let you grab anything on your computer desktop through a secure server. You might get hung up, but in the Internet age, your business shouldn't.

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