Business continuity is an organization’s ability to continue delivering products and services at certain pre-determined and accepted levels in the wake of a disruptive incident. Businesses today face many unprecedented threats that have the capability of bringing them to their knees.
The frequency with which severe weather-related disasters are occurring has left companies more susceptible than ever. The increasing reliance on Information technology systems and supply chains has also left companies more vulnerable.
What Is Business Continuity?
Companies cannot afford just to sit and hope to survive when these disasters strike. Business continuity management proposes frameworks within which an organization can build its resilience to come up with responses that protect the image of the brand and stakeholders’ interest. Although many businesses claim to be prepared in case of disaster, most of them have not invested in any business continuity plans.
But what is business continuity management in a nutshell? It is a comprehensive process that identifies possible threats organizations face and the effects such threats may have on business operations.
Misconceptions around Business Continuity
Employees Will Figure out What to Do During Emergencies
Most employees have no idea of what to do during an emergency. Having a detailed plan beforehand can help in coordination and would avoid the chaos that would result from everyone responding differently.
Insurance Will Cover All the Losses
Insurance may not be enough to mitigate all the losses. Though important, it will not include the loss of customers, development setbacks or loss in market share. It is, therefore, prudent to invest in a business continuity plan.
There Is No Time to Create a Business Continuity Plan
The time and effort spent in developing a business continuity plan should be considered an investment in the firm. This investment is not much when compared to the losses the company is likely to incur during a disaster.
Elements of a Good Business Continuity Plan
Identifying and prioritizing critical business operations
A business continuity plan should only be sound if it can identify its most critical operations accurately. Though it seems natural, prioritizing business operations could be a huge challenge. In particular cases, the list can be very exhausting as departmental heads jockey to remain on top. In other situations, it may fail to prioritize anything in a bid to avoid creating business continuity plans that would take a lot of time and effort. Each business operation should be assessed on its impact on the entire business if it were to be stopped or delayed.
Determining Recovery Time Objectives
When a disaster occurs and stops a business operation, it might take a while before the impact is felt due to the temporary mitigations employed. This temporary fixes can only last for so long, and sooner or later they tend to become ineffective. That point in time when the business operation would have to be restored is the recovery time objective. A good business continuity plan should spell out this alternative processes. The plan should factor in people, property, process, and technology to be effective whatever the disaster.
Conducting a Comprehensive Risk Assessment
Businesses need to come up with mitigation strategies that are proportionate to the expected loss. In attempting to perfect risk management methods, companies run the risk of getting too mired in the details forgetting the bigger picture. Planning for every possible disaster will not work for example. The trick is to focus on the four essential elements (people, property, process, and technology) and to categorize the effects on them into two groups: Total loss and reduced functionality. Only eight possibilities will arise for each.
Making Succession Plans for the Leading Individuals
Business continuity plans mainly overlook the possibility of losing key decision makers. Losing an important decision maker like the data center manager or the head of corporate communications can halt business operations. Such people are purview to information that may not be in the recovery documents. An alternate should be selected for each critical position. These alternates should regularly fill the incumbent’s shoes during planned operations.
Why Is a Business Continuity Plan Necessary?
Twenty-five percent of enterprises are not able to reopen when a major event disrupts business operations. In fact, often the minor incidents like broken water pipes or power failures are likely to cause massive damages compared to major disasters. A business continuity plan can improve your business to recover and survive during such times.
2. Competitive Advantage
Of all the companies surveyed by the traveler in 2012, 48% had no business continuity plan. Creating such a business continuity plan is, therefore, a smart move since it will give the company a competitive edge over so many other businesses.
3. Lowering Insurance Premiums
Insurance plays a vital role in managing business risks, but it can be very costly. Insurance companies usually set premiums rates after assessing the levels of risk. Having a business continuity plan demonstrates commitment in managing risk and may be considered when calculating premium rates.
4. Protecting the Brand
Having a business continuity plan shows preparedness and willingness to protect the employees, clients, and assets. This level of commitment will build staff morale and shape public opinion about your business and brand. Your reputation is, therefore, likely to grow.
5. Disasters Are Becoming Too Common
Natural disasters are on the rise and businesses should prepare themselves for any eventuality. Firms that are considered to be in “safe” zones should not sit pretty either especially in the recent wave of cyber-attacks on corporations around the world. No business is safe.
Start Your Business Continuity Plan Today
Business continuity is too important to ignore. All companies should invest in protecting their future even as they continue to tackle the problems of today. Failing to plan is planning to fail. Although thinking about unfortunate events may seem unpleasant, having a well-detailed plan will go a long way in helping your business survive if disaster comes knocking.
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