The importance of having a business continuity plan
When the world is chugging along as normal and business operations only have the usual risks to monitor, it can be easy to put aside business continuity planning. But, as we've all discovered in recent weeks, anything can happen at any time, and businesses must be ready to pivot operations quickly, efficiently and safely as and when needed. The quick global spread of COVID-19, colloquially known as coronavirus, has thrown the world into disarray. The markets are in a nosedive, governments are shutting down entire countries and most organizations are having to quickly embrace remote working to keep the lights on and keep clients serviced. Those who do not have the capability to support workers at home ' and that are not essential services such as healthcare or sanitation ' are currently going through a trial by fire, with operations stymied and revenue under threat. Businesses are rushing to set up work-from-home arrangements, or take out subscriptions for online meetings and cloud collaboration technology. Priorities are shifting dramatically as we enter uncharted territory. This lack of preparedness could well see many businesses going under ' but if those organizations had created a robust business continuity plan ahead of time, they would know exactly how to handle such a crisis and weather the storm.
What is a business continuity plan and why do you need one?
A business continuity plan, or BCP, refers to the process a company will take to prevent and recover from potential threats to the organization. It ensures personnel and assets are protected and able to function in the event of a disaster, and is generally part of overall risk management ' that is, best practice dictates that you consider your business continuity plan ahead of time, not when a crisis hits. Your business continuity plan considers what those risks may look like ' both physical threats such as fire or flood, and those threats that are harder to pin down, such as hacks and pandemics ' and then determines:
- How those risks will impact operations
- How you'll implement safeguards, procedures and policies to mitigate the risks
- How you'll test procedures to ensure that they work
- How you'll review the process to keep it up-to-date
It includes a summary of the most critical business processes and functions ' those aspects that, if they failed, your business would be unable to operate ' as well as internal and external communication strategies, clear instructions for accessing and restoring offsite recovery data, any potential temporary offices or locations, and a change log that summarizes any updates to the plan for version-control purposes. Without a business continuity plan, you risk your company and its people . Not only could the business fail, but you could also suffer financial loss, a tarnished reputation and lost productivity. A physical disaster could also impact your employees, potentially causing injury or death.
Ensure continued — and secure — access to systems
With COVID-19 playing havoc with how companies go about their day-to-day activities, the priority for organizations should be on building business resilience. This means being flexible enough to go with the flow while maintaining operations at as normal a level as possible, all while ensuring your employees can access the systems and processes they need to do their jobs. It also means keeping a close eye on matters of cybersecurity. Those companies that maintain on-premises systems have suddenly found themselves in a pickle, as workers are unable to come into the office with cities on lockdown. The question of how teams will access platforms is an essential part of business continuity planning, and something that smart risk managers had covered long before the pandemic hit. They had thought about how teams would access platforms, assessed what bandwidth they had available for that level of remote access, and had considered whether they needed a temporary increase in network capacity or licenses. The security question, though, doesn't just extend to moving to cloud-based operations; hackers and cyber threats will use any crisis to their advantage. Keep an eye out for phishing scams, DDoS attacks and malware being introduced by employees keen to learn the latest developments in the crisis and not closely examining the links they click on. Security postures should include a review of systems you have in place to stop phishing campaigns and other inbound threat vectors before they hit employees' inboxes, writes Jason Albuquerque for InformationWeek .
Creating a business continuity plan
While every organization's business continuity plan will be different, there are some common steps that companies should follow to develop a solid continuity plan. They include:
- Undertaking a business impact analysis to identify functions and related resources that are time-sensitive
- Identifying and implementing steps to recover critical business functions
- Creating a continuity team that will be tasked with devising a plan to manage the disruption
- Training and testing the continuity team, and ensuring they regularly go over the plan and strategies to mitigate risk and ensure they are kept up-to-date
By considering these things in advance, organizations can help to ensure business continuity when things get tough, protecting the business, its reputation, its people and its customers.
The importance of technology to business continuity for legal operations
Of course, the march toward cloud-based technology to run essential business systems and processes makes business continuity planning a little easier. Once upon a time, you had to be in the office and on the network to access things like entity management software; today, there is a plethora of cloud-based options for all aspects of legal operations, compliance, governance and risk management work. Best-in-class providers of these systems are supporting their clients through the current COVID-19/coronavirus crisis, helping them to make sense of the craziness by providing online support, guidance and tech triage. More than just a software provider, these organizations become an essential partner in times of crisis. Diligent is one such company, acting as a partner to more than half of the Fortune 1000. Through its cloud-based legal technology platforms, Diligent enables proactive governance to help mitigate the risks of modern business. We believe every business should have the necessary business continuity planning and management strategies, plans and procedures in place, fully tested at regular intervals, to drive the assurance that when disaster strikes, they'll be ready. The cost and impact of not being prepared is usually far greater than that of being proactive. Diligent works to enable business continuity planning by ensuring ongoing access to essential documents, contracts and entity data through:
- Diligent Entities , which helps organizations to centralize, manage and effectively structure their corporate record to improve entity governance and improve decision-making
- Diligent Boards , which empowers boards and executives with the tools, insights and analytics to securely access board materials, track company performance and gather real-time information
- Diligent Assurance , which helps organizations to confidently create, manage and report on the obligations relevant to their business, and always be audit-ready.
Get in touch and request a demo to see how Diligent's suite of cloud-based governance and compliance software can help drive your business continuity planning and ensure your organization can continue to operate, no matter what gets thrown your way.
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Don’t underestimate the importance of a business continuity plan
Here’s how to protect your people, practices, and technology.
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When disruption is unacceptable, business continuity is critical. Threats such as cyberattacks and natural phenomena can strike without warning, and business continuity is all about maintaining (or quickly resuming) business functions across all business lines – from HR and IT to marketing and sales – when the unexpected comes to pass. A comprehensive business continuity plan should be embedded as part of your organizational strategy; without it, you run a high risk of negatively impacting your productivity, reputation, revenue, and more. However, it is key to recognize that there’s more nuance to business continuity than you might think – read on for a brief overview and a deeper dive into this critical strategy.
Preparing for a crisis
Based on findings from a recent survey, PWC recommends three ways companies can better prepare for a crisis. – Design a strategic crisis response plan to mobilize swiftly, stabilize business operations and respond effectively to the shockwaves of disruption. – Break down silos – creating an integrated program is key to delivering a successful crisis response and to building resilience during everyday practices. – Prioritize and build organizational resilience into the fabric of your organization.
Business continuity is more than just disaster recovery
When people think of business continuity, they typically think of disaster recovery and traditional IT service outages. While IT infrastructure and operations are important components, you also need to ensure that your business continuity plan encompasses your people and practices. Many incidents outside of your technology can create the need for a business continuity plan, including lack of access to physical workspace, reputational crisis, or loss of key company individuals. To be able to appropriately respond to a wide range of issues, organizations should be set up in a way that enables its people to make impactful decisions without being hindered by bureaucracy – not to mention having strong practices in place.
Case in point
We can look to the COVID-19 pandemic as a recent example of the urgent need for a comprehensive business continuity plan. Throughout the pandemic, business continuity planning has been critical – and it had nothing to do with the traditional IT outage. Organizations had to act quickly in order to continue business as usual and deliver the quality service their customers had come to expect. Disruption (in one form or another) was inevitable as teams scrambled to shift their approach to work and maintain the status quo. As teams continue to adapt in these unprecedented times, remote work has risen drastically, requiring businesses to implement new practices, rely more on agile methodologies, and assess their tooling to get work done. Click below to learn IT best practices that Atlassian implemented for a remote workforce
But what about my technology?
Atlassian Cloud Enterprise: What it is & why we made it
While it’s key to recognize and protect your organization from the variety of factors that could lead to disruption and crisis, the topic of technology – outages, downtime, and loss of data – seems to occupy the majority of our mental real estate. Your tools are critical to your success, and failure to access them and the data they store can spell crisis. Choosing software that can safeguard your company is a no-brainer.
Atlassian cloud products remove a large piece of responsibility, and headache, from your business continuity plan. Leveraging Atlassian cloud opens up the time and freedom for your organization to focus on other practices and organizational needs. Atlassian cloud maintains the highest standards of reliability, with a guaranteed 99.95 percent uptime SLA and built-in business continuity and disaster recovery frameworks.
For organizations that need to maintain control via a self-managed environment, Disaster recovery for Data Center products ensures availability in the event that your primary instance becomes unavailable.
Other benefits of Atlassian cloud products and the virtualization of your software help mitigate future possible disruptions. When you don’t have to worry about physical infrastructure, that’s one less treason to panic over the possibility of physical destruction (think fire, flood, or earthquake) or the inability to get to a physical location for service (whether that’s due to damaged infrastructure or a pandemic).
We know that by choosing Atlassian products, you’re counting on us to assist in your business continuity plan holistically. Organizations run mission-critical projects and operations on Atlassian products, and we’re utterly devoted to delivering products, applications, and networks that are stable and secure at scale.
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- Business Continuity Plan Basics
- Understanding BCPs
- Benefits of BCPs
- How to Create a BCP
- BCP & Impact Analysis
- BCP vs. Disaster Recovery Plan
Frequently Asked Questions
- Business Continuity Plan FAQs
The Bottom Line
What is a business continuity plan (bcp), and how does it work.
Pete Rathburn is a copy editor and fact-checker with expertise in economics and personal finance and over twenty years of experience in the classroom.
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What Is a Business Continuity Plan (BCP)?
A business continuity plan (BCP) is a system of prevention and recovery from potential threats to a company. The plan ensures that personnel and assets are protected and are able to function quickly in the event of a disaster.
- Business continuity plans (BCPs) are prevention and recovery systems for potential threats, such as natural disasters or cyber-attacks.
- BCP is designed to protect personnel and assets and make sure they can function quickly when disaster strikes.
- BCPs should be tested to ensure there are no weaknesses, which can be identified and corrected.
Understanding Business Continuity Plans (BCPs)
BCP involves defining any and all risks that can affect the company's operations, making it an important part of the organization's risk management strategy. Risks may include natural disasters—fire, flood, or weather-related events—and cyber-attacks . Once the risks are identified, the plan should also include:
- Determining how those risks will affect operations
- Implementing safeguards and procedures to mitigate the risks
- Testing procedures to ensure they work
- Reviewing the process to make sure that it is up to date
BCPs are an important part of any business. Threats and disruptions mean a loss of revenue and higher costs, which leads to a drop in profitability. And businesses can't rely on insurance alone because it doesn't cover all the costs and the customers who move to the competition. It is generally conceived in advance and involves input from key stakeholders and personnel.
Business impact analysis, recovery, organization, and training are all steps corporations need to follow when creating a Business Continuity Plan.
Benefits of a Business Continuity Plan
Businesses are prone to a host of disasters that vary in degree from minor to catastrophic. Business continuity planning is typically meant to help a company continue operating in the event of major disasters such as fires. BCPs are different from a disaster recovery plan, which focuses on the recovery of a company's IT system after a crisis.
Consider a finance company based in a major city. It may put a BCP in place by taking steps including backing up its computer and client files offsite. If something were to happen to the company's corporate office, its satellite offices would still have access to important information.
An important point to note is that BCP may not be as effective if a large portion of the population is affected, as in the case of a disease outbreak. Nonetheless, BCPs can improve risk management—preventing disruptions from spreading. They can also help mitigate downtime of networks or technology, saving the company money.
How to Create a Business Continuity Plan
There are several steps many companies must follow to develop a solid BCP. They include:
- Business Impact Analysis : Here, the business will identify functions and related resources that are time-sensitive. (More on this below.)
- Recovery : In this portion, the business must identify and implement steps to recover critical business functions.
- Organization : A continuity team must be created. This team will devise a plan to manage the disruption.
- Training : The continuity team must be trained and tested. Members of the team should also complete exercises that go over the plan and strategies.
Companies may also find it useful to come up with a checklist that includes key details such as emergency contact information, a list of resources the continuity team may need, where backup data and other required information are housed or stored, and other important personnel.
Along with testing the continuity team, the company should also test the BCP itself. It should be tested several times to ensure it can be applied to many different risk scenarios . This will help identify any weaknesses in the plan which can then be identified and corrected.
In order for a business continuity plan to be successful, all employees—even those who aren't on the continuity team—must be aware of the plan.
Business Continuity Impact Analysis
An important part of developing a BCP is a business continuity impact analysis. It identifies the effects of disruption of business functions and processes. It also uses the information to make decisions about recovery priorities and strategies.
FEMA provides an operational and financial impact worksheet to help run a business continuity analysis. The worksheet should be completed by business function and process managers who are well acquainted with the business. These worksheets will summarize the following:
- The impacts—both financial and operational—that stem from the loss of individual business functions and process
- Identifying when the loss of a function or process would result in the identified business impacts
Completing the analysis can help companies identify and prioritize the processes that have the most impact on the business's financial and operational functions. The point at which they must be recovered is generally known as the “recovery time objective.”
Business Continuity Plan vs. Disaster Recovery Plan
BCPs and disaster recovery plans are similar in nature, the latter focuses on technology and information technology (IT) infrastructure. BCPs are more encompassing—focusing on the entire organization, such as customer service and supply chain.
BCPs focus on reducing overall costs or losses, while disaster recovery plans look only at technology downtimes and related costs. Disaster recovery plans tend to involve only IT personnel—which create and manage the policy. However, BCPs tend to have more personnel trained on the potential processes.
Why Is Business Continuity Plan (BCP) Important?
Businesses are prone to a host of disasters that vary in degree from minor to catastrophic and business continuity plans (BCPs) are an important part of any business. BCP is typically meant to help a company continue operating in the event of threats and disruptions. This could result in a loss of revenue and higher costs, which leads to a drop in profitability. And businesses can't rely on insurance alone because it doesn't cover all the costs and the customers who move to the competition.
What Should a Business Continuity Plan (BCP) Include?
Business continuity plans involve identifying any and all risks that can affect the company's operations. The plan should also determine how those risks will affect operations and implement safeguards and procedures to mitigate the risks. There should also be testing procedures to ensure these safeguards and procedures work. Finally, there should be a review process to make sure that the plan is up to date.
What Is Business Continuity Impact Analysis?
An important part of developing a BCP is a business continuity impact analysis which identifies the effects of disruption of business functions and processes. It also uses the information to make decisions about recovery priorities and strategies.
FEMA provides an operational and financial impact worksheet to help run a business continuity analysis.
These worksheets summarize the impacts—both financial and operational—that stem from the loss of individual business functions and processes. They also identify when the loss of a function or process would result in the identified business impacts.
Business continuity plans (BCPs) are created to help speed up the recovery of an organization filling a threat or disaster. The plan puts in place mechanisms and functions to allow personnel and assets to minimize company downtime. BCPs cover all organizational risks should a disaster happen, such as flood or fire.
Federal Emergency Management Agency. " Business Process Analysis and Business Impact Analysis User Guide ," Pages 15 - 17. Accessed Sept. 5, 2021.
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Experts Discuss the Importance and Advantages of Business Continuity Plans
By Andy Marker | August 25, 2020 (updated October 14, 2021)
Experts make the case for developing a business continuity plan so that disruptions don’t negatively affect your operations, when they inevitably arise.
Included on this page, you’ll learn the importance and benefits of business continuity planning (BCP) , and how a strong plan helps staff in a crisis . Plus, find a PowerPoint business continuity argument template to help make the case for embracing business continuity in your company.
What Is a Business Continuity Plan?
A business continuity plan (BCP) is part of a business continuity management system (BCMS), and includes the procedures an organization must follow in an emergency. The document also contains steps for recovery in the days and months after the incident.
One part of a BCP is the disaster recovery plan , which contains plans for IT and technical continuity. An organization can follow specific steps to write its business continuity plan, or hire an outside consultant. For details on writing a BCP, read "How to Write a Business Continuity Plan” ,
Importance of a Business Continuity Plan
A strong business continuity plan can reduce risks during a crisis, and helps ensure that the company can continue to provide goods or services and earn income by detailing how to respond during and after an incident.
An often-quoted statistic claims that 40 percent of businesses never recover from a disaster . Although some experts question the statistic’s sources, it stands to reason that recovering from a major disruption is tough. After all, staying in business can be difficult, even during the best of times.
As business continuity consultant Alex Fullick, General Manager at Stone Road , explains, "I think the global pandemic has proven that everybody and every organization, no matter what size, needs the ability to respond and recover from any sort of eventuality, whether large or small. If anyone still has the mindset that it's going to happen to someone else, they're probably going to go out of business."
As natural disasters and data breaches become more frequent, the question is not if, but when a disruptive event will take place.
Business continuity plans can help an organization address the following issues before disruption occurs:
- People Don't Know What to Do in a Disaster: Proactively creating plans and training employees ensures a safe and timely recovery. When you've identified sensitive and critical functions ahead of time, you can better plan to execute quickly when a crisis occurs.
- Insurance Isn't a Solution: An organization may acquire insurance plans for healthcare, vehicles, or fixtures and equipment replacement. However, insurance can't cover the loss of customers who turn to other companies when you can't fulfill orders or reimburse you for a lost reputation.
- Creating a Plan Is an Investment in Your Company: Although a BCP may carry fixed costs in training, wages, or equipment, the plan will get your company up and running ASAP in a disaster. For more about budgeting for a business continuity plan, read “ Business Continuity Planning: How to Do It Well .”
Business continuity can also provide a competitive edge. As the following examples show, companies that pursue business continuity are first to get back to work after a disaster.
- Fire swept through the facilities of Cantey Technology, a consultancy and server host, destroying cables and hardware. However, a business continuity plan gave the company the foresight to implement a redundant offsite data center with regularly scheduled backups, which ensured seamless, continued service for clients.
- In another instance of a fire, this time at a telecom provider, redundant network infrastructure and solid incident planning enabled the company to restore service within six hours of a fire reaching the switching center.
- Even though they were located on the second floor, Houston-based Gaille Media’s offices were destroyed during Hurricane Harvey. Since they stored their data and critical documents in the cloud, however, they continued to serve customers throughout the disruption, with staff working remotely.
"I find myself a little frustrated with some planners who have said, ‘Oh, they're busy updating their pandemic plan now,’" Fullick adds. "What do you mean you're updating your plan on people's availability? Don't you already have plans in place for, let's say, the winter flu season when you're missing 20 percent of your staff because they're all at home with the flu?"
How Business Continuity Helps Different Departments
Importance of business continuity for the supply chain .
Supply chain disruptions can be crippling, and a BCP can help sustain inventory levels. A business impact analysis (BIA) can reveal risks to key vendors’ ability to make and deliver goods in a crisis, so you can plan ahead.
Toyota plants in North America demonstrate how a broken supply chain shut down production thousands of miles away. After the 2011 Fukushima earthquake in Japan, Japanese parts manufacturers went offline. When Toyota plants in southern Ontario couldn’t get parts for the assembly line, the company had to lay off many employees.
"Companies are starting to realize they can be impacted, [and] not just directly by an upstream supplier that sends them something. That supplier can be impacted, too, and the effect trickles down,” Fullick explains. “[As] you see in the news, companies are starting to think more locally, rather than internationally. Companies have more control over a supplier or a vendor who is local, in the same state or province or country, than [they do] over a supplier in another country."
Ask how your suppliers will respond to a disruption to determine if they have a business continuity plan. Then, work that information into your BCP.
Importance of Business Continuity to Small Business
Small business owners often think they are exempt from crises — but when large-scale events occur, they can be among the first casualties. Almost a quarter of companies that do reopen fail within a year; having a BCP is essential to recovery.
"Unfortunately, some people think it won't happen to us ," says Fullick. "That carefree attitude is no longer tenable, especially after a pandemic that affected everyone."
For Tony Bombacino, business continuity is a daily practice. He is the co-founder and President of Real Food Blends , a private company that makes whole foods for people with feeding tubes. “I'm always thinking to myself, 'What am I not thinking about?'” he says. “I spend a lot of time thinking about what might happen, and how to be ready for it.”
Bombacino also believes that business continuity preparedness starts outside of the business continuity plan. "It starts up front with contract negotiation” he says. “Cash is king in a small business.”
Real Food Blends doesn’t produce or pack their products, so it’s important that his manufacturing partners are large, stable, and have their own well-defined business continuity plans. If his partners aren’t prepared for handling disruption, his business might not be able to survive.
Importance of Business Continuity to IT
Most companies rely on IT to maintain services like the internet and Voice over IP (VoIP). The team also stores documents and runs machines. Without IT, a business is unworkable. Therefore, a business continuity plan for IT is crucial.
Importance of Business Continuity Planning in Crisis Management
Crisis management is part of a business continuity plan. Business continuity provides the overall approach for protecting human and other resources, and ensures that vital processes keep running. Crisis management focuses on communications and decision-making.
The Importance of Governance in Business Continuity Management
Effective governance is key to sustaining business continuity efforts. Governance starts with the business continuity policy, and the support of leadership ensures the plan always covers new risks.
However, not everyone thinks that governance always addresses all the correct questions. "Traditionally, governance tends to focus on how many scenarios your plan covers," explains Fullick. "It covers a flood, it covers fire, it covers an earthquake, a tornado, and a hurricane. You need a different plan for each one. Five plans. Each department has five plans, but do they contain the right detail?”
The Importance of Business Continuity to HR and People
Crises do not only impact tools and buildings — they also affect human well-being. If you understand how disasters change lives, you can better help staff manage their emotional and physical tolls.
"We bring our whole selves to work," says Debbie Rosemont, a productivity consultant and Certified Professional Organizer at Simply Placed , a business consulting firm. "I don't take my emotions, or what happened to me before I came to work, and set that outside. Who I am and how I feel shapes my ability to work and produce. When businesses or companies think about continuity plans, they've got to consider the whole person and how an event or disruption might impact somebody, even if it happens outside of work."
Disruptions can prevent people from coming to work. Illness, like a flu outbreak, may keep them at home. Damaged roads and train systems (that can occur after an earthquake) can hinder their commute. Whether employees commute to the office or work remotely, some of the following concerns may distract them from their duties:
- They fear they will be laid off.
- They've lost loved ones.
- They have a financial burden and are anxious about economic losses.
- They've suffered a disruption to their living arrangements with a loss of personal effects from a natural or human-made disaster.
"When there are job losses, when people don't know when they're going to get their next gig, when some people have lost numerous family members, this is extreme grief," says Michele Barry , Principal Consultant at Fortis Consulting. "You need your cloud system as your recovery system. You need an evacuation plan. You need to get all your files back after a crisis, which could motivate staff and sustain the business. But understanding people and politics is essential, too."
Rosemont suggests that doing business continuity planning in "normal times" is a chance for employers to source support systems. Employees can use these resources daily and during a crisis. Examples of resources include the following:
- An excellent healthcare benefits program
- An employee assistance program (EAP) that provides discounted legal or other advice
- Mental health and medical resources, such as access to doctors or counselors
- Daycare facilities or resources for both children and adults (such as elderly parents)
- Financial planning tools or advisors
- Sources of financial assistance
- Apps for meditation and calming anxiety
A further consideration, especially in natural disasters, is that it may be easier to restore the business than to gather your workforce. “It's easier to recover technology than it is to have the people there to use it,” explains Mike Semel, President and Chief Compliance Officer at Semel Consulting . “With the cloud and online backups, you can just go to somebody else's computer and log into Microsoft and get to your email. Your bigger problem will be people, and you need to focus on making sure your people don't disappear on you.”
In disasters, people may leave town. If you can keep people safe, but local, you may be able to recover your business faster. As an example, he shares how his company guided a credit union to contract with a local hotel chain. The executives would move their families to safety and only then return to work. This same consideration applies to small businesses. “If you're a doctor's office, you know that the doctor needs to be there,” says Semel. “The receptionist needs to be there. The nurse needs to be there.”
How Business Continuity Helps
Business continuity business case template.
Top leadership might wonder why they should invest time and money in business continuity planning. Use this free downloadable business case template to build a convincing argument for business continuity. These customizable slides include suggested argument points that you can adapt to fit your company’s needs.
Download Business Continuity Business Case Template — PowerPoint
For most useful free, downloadable business continuity plan (BCP) templates please read our "Free Business Continuity Plan Templates" article.
Benefits of Having a Business Continuity Plan
The benefit of a business continuity plan is that it prepares a company for a crisis. Trained staff will know what to do and the organization will be able to safely continue delivering key products and services, while meeting its legal and other commitments.
The following are additional advantages of business continuity:
- Review Weaknesses and Risks: Planning for business continuity provides valuable data and insights that have worth beyond emergency preparedness. Business continuity planning means leadership can assess skills, resources, strategies, and personalities, and uncover inefficiencies. Such findings often result from a business impact analysis. To learn more, read “ All about Business Impact Analysis: A Step-by-Step How-To .”
- Understand Your Business Processes: Business continuity planning demands that you put your entire organization under a microscope. As a result, you can find and remedy inefficiencies in everyday operations, which will make your company more resilient.
- Improve Processes: Ideally, your plan will cover all aspects of the company and can reveal new challenges and opportunities. Improving processes at all levels pays for the investment.
- Help Companies Pivot Quickly: Planning helps you quickly recover critical IT systems and other processes after an incident.
- Build Confidence among Customers: With your BCP, customers know they can rely on continued access to your products or services. For example, when experiencing the aftermath of a natural disaster or a pandemic, B2C customers may find comfort in such things as a favorite food that you may provide. Your parts and services may help B2B customers pursue their livelihoods in the face of uncertainty.
- Build Confidence among Employees: A plan and adequate training shows staff what to do when a crisis occurs. They also have some reassurance that their jobs will continue during and after a disruption.
- Mitigate Financial Risk: A 2019 ITIC survey indicates that an hour of downtime can cost anywhere between $1 million and $5 million for large enterprises. Smaller businesses (those with 200 to 500 employees) responded that halting processes for one hour can cost at least $100,000. Can your company afford such losses? Plans reduce losses.
- Keep Your Team Members Safe: Creating and training staff on an accident response and evacuation plan can keep your team safe during accidents and disasters.
- Define Responsibility: When management and the chain of command grow ad hoc, they can fail in a crisis. A strong business continuity system names and trains crisis response leaders, and also provides roles for the rest of the team. "People need to be empowered to actually take action, and not sit there and wait for the CEO to make a decision," insists Fullick.
- Streamline Technology: As part of the process, you will review processes and the digital platforms and infrastructure that the company has pieced together over time. You may find that it’s practical to integrate technology, and one platform may effectively complete the tasks of several disparate apps.
- Allocate Key Financial and Human Resources: Understanding your company’s critical functions means you can focus financial and human resources on those processes, so you can keep the business running during a severe disruption.
- Provide a Way to Continue Working: Planning helps ensure that remote workers have access to the files, applications, and digital resources they need. This step reduces or eliminates downtime, so you can still provide products and services to customers.
- Eliminate Potential Costs: When a business is offline or closed, it inevitably loses revenue. However, slipped supply deadlines can result in additional fees from vendors or, depending on the locale and industry, fines for regulatory non-compliance.
- Make Coping in a Crisis Easier: In an emergency, people are often distracted thinking about their safety, as well as that of their friends and family. Training and a plan to fall back on helps people focus.
What Is Business Continuity Management (BCM)?
Business continuity management is the process a company uses to identify risks and, from there, to avoid or reduce the impact of those risks. Ultimately, this makes a company more resilient in a crisis.
Disruptive events can impact information systems, business processes, or both. For example, a hurricane or an earthquake can cut electricity. Without power to run data centers or laptops, business processes such as supply replenishment and payroll are impossible.
As StoneRoad’s Fullick explains, "Business continuity management is a set of plans and procedures to help you prepare for, respond to, and recover from business interruptions. Beyond that, it empowers people to make decisions when things occur. It's about knowing what resources and skills are available when something happens, whether it’s a small incident or a global pandemic."
With BCM, companies review their needs and capabilities to create contingency plans. From there, they can deliver at least some of their regular output, or the minimum acceptable service, in the event of a crisis. Continuity of service preserves a corporation’s reputation and revenue.
Benefits of Business Continuity Management System (BCMS)
A BCMS keeps staff safe and protects assets from risk. With human, IT, and other resources, a company can continue to provide goods and services. As a result, the company will continue to create revenue and retain a solid reputation.
You can learn about the types of risks and threats to organizations, as well as regulatory requirements for business continuity planning in our article, “ Business Continuity Planning: How to Do It Well .”
"I don't think as many business people consider business continuity like they should,” says Bombacino. “I feel more prepared here, at my company, than I did when I worked at big companies. I think that’s because when big companies get really big or successful, or have lots of money, they think nothing bad can happen to them. One boss used to say there's a difference between being successful because of something and being successful in spite of something. Many companies are successful and don't have a business continuity plan. But what one thing could happen and wipe them out because they're not ready?”
Fullick adds that the value of business continuity will become increasingly clear to companies in the near future. “I think business continuity will grow as a key component for a lot of organizations, and [that] leadership on all levels is going to focus on BCP now.”
Disadvantages of Business Continuity Plans
Business continuity plans are costly and time-consuming to execute. Plans often require outside advice, and poorly written plans (or those that leadership doesn’t support) can be unsafe and cause financial losses.
A plan also risks becoming a ticked box on a requirements list, rather than an actionable, practical document. Management can forget to share the plan with the teams who could benefit from it. "Often when people aren't a part of discussions, the crisis management team is activated, but everyone else, including leadership, is sitting around and thinking, ‘What's going on?’” explains Fullick. “Management and employees are each waiting for the other to act. But people should know what to do and just start doing it."
Plan writers also often worry too much about specific disaster scenarios. "You need to focus on people, places, and things, and not so much on the trigger," Fullick urges. "You could lose your building because of a pandemic, or a flood, a fire, or an earthquake. Those are all different triggers for the same problem: What do we do now that our building is gone? Continuity planning should be about building a skillset, so your employees and leadership — beyond the disaster recovery team — know exactly what to do, and what the resources are, no matter what is happening."
In essence, business continuity planning empowers people and adds value to the company. Real Food Blends’ Bombacino says, “Some entrepreneurs hate meetings and process and structure. They don't want to talk about business continuity planning. But for us, this is our life's work. Other families, our customers, depend on us. So we view business continuity planning not as just a smart thing to do, but as our responsibility to make sure that we avoid the continuity pitfalls out there."
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