Survival Likelihood of Micro and Small Businesses Facing a Catastrophe

Abstract

This chapter proposes a measurement methodology throughout a Bayesian Network to quantify the survival probability of micro and small enterprises (MSEs) facing a catastrophic event, and to assess if a Business Continuity Plan (BCP) is a unique alternative to prevent companies from bankruptcy. Empirical evidence for a developing country shows the majority of companies are MSEs and without enough knowledge about a BCP; therefore, the likelihood of businesses’ survival will depend on BCP and several other elements that should be taken into account for owners when making decisions towards negative effects of catastrophic events. Results showed that for MSEs businesses with high face-to-face customer interaction, a BCP might be useful as well as the experience in crisis of the management team, but not as the only variable.