business continuity plan vs contingency plan

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Difference Between Business Continuity and Contingency Plan

• Categorized under Business | Difference Between Business Continuity and Contingency Plan

Minor and major disruptions must be avoided at all costs for business survival. Most events that can cripple business operations are non-predictable including terrorist attacks, cyber-attacks and natural disasters including floods, earthquakes and fires. These cost businesses money, time, customer loyalty and market share. Since no one can predict future events and the ability of businesses to resume normal business functions, companies must hence put in place measures to ensure that businesses continue running even after these unfortunate events occur. Among these measures include business continuity plans and contingency plans. 

What is Business Continuity?

This is the ability of businesses to carry out their normal activities and function after unplanned events have occurred. These events could be a pandemic, a business crisis, natural disasters or even workplace violence.  Businesses should not only plan and prepare for major disruptions that will completely affect business operations but also events that could adversely affect functions and services. 

 A business continuity plan may entail but is not limited to: 

• The team that will manage emergency events
• Measures to ensure services and customers are availed to customers
• Employee support measures 
• Technological measures to restore business functions
• Where to relocate people and processes in case business locations cannot be used
• Measures to ensure staffing levels are adequate in the case of an unprecedented event

Among events that a business continuity plan will guard against include;

• Natural and local disasters- These include fires, electronic malfunction, earthquakes and floods
• Network disruptions- This is important for businesses that need a reliable connectivity to operate
• Cybersecurity- Due to the rise of cybersecurity threats, businesses should ensure all data is backed up 
• Human error- Outages can be caused as a result of innocent mistakes and ignorance, and should be mitigated 

What is Contingency Plan?

A contingency refers to activities or events that occur beyond the normal range of organizational operations. A contingency plan can, therefore, be defined as an actionable and defined plan that will be enacted if an identified business risk or unfortunate event occurs. Contingency plans are part of risk management and can be created for identified or non-identified risks. It can also be created to take advantage of strategic opportunities. 

A contingency plan is not only a need for large businesses as small to medium businesses can also be crippled by unforeseen events. They can also be tailored to specific departments. For instance, the need to protect, restore and use data in an organization may require an information services department contingency plan. 

Importance of contingency plans

• Allow organizations to resume normal business functions as fast as possible after an unforeseen event has occurred
• Minimizes consumer inconveniences
• Identification of staffing needs in the context of recovery

A good contingency plan should include;

• Natural disasters such as earthquakes, fires and hurricanes
• Crisis including worksite injuries and accidents
• Personnel such as strikes and employees deaths
• Product issues such as plan relocations
• Mismanagement such as accidental destruction and theft

The process of developing a contingency plan involves the identification of essential business operations and sectors and determining how these processes can be affected by the occurrence of unforeseen events. Actions that would be needed to return these to normal operations should be identified and documented, including the resources that would be needed for this. A good contingency plan incorporates each functional area in an organization  

Similarities between Business Continuity and Contingency plan

• Both entail enforcing measures for businesses to operate even after unprecedented events have occurred

Differences between Business Continuity and Contingency plan

Business continuity refers to the ability of businesses to carry out their normal activities and function after unplanned events have occurred. On the other hand, a contingency plan refers to an actionable and defined plan that will be enacted if an identified business risk or unfortunate event occurs. 

While business continuity is based on the concept of business survival after the occurrence of unprecedented events, contingency planning is based on the concept of preparation of all types of disruptions and steps that should be followed when these disruptions occur. 

Business continuity vs. Contingency plan: Comparison Table

 Summary of Business Continuity vs. Contingency Plan

Business continuity refers to the ability of businesses to carry out their normal activities and function after unplanned events have occurred. It is based on the concept of business survival after the occurrence of unprecedented events. On the other hand, a contingency plan refers to an actionable and defined plan that will be enacted if an identified business risk or unfortunate event occurs. It is based on the concept of preparation of all types of disruptions and steps that should be followed when these disruptions occur. 

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Cite APA 7 Njogu, T. (2020, July 14). Difference Between Business Continuity and Contingency Plan. Difference Between Similar Terms and Objects. http://www.differencebetween.net/business/difference-between-business-continuity-and-contingency-plan/. MLA 8 Njogu, Tabitha. "Difference Between Business Continuity and Contingency Plan." Difference Between Similar Terms and Objects, 14 July, 2020, http://www.differencebetween.net/business/difference-between-business-continuity-and-contingency-plan/.

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Understanding emergency, contingency and business continuity plans

Examining the nuances between business continuity planning, disaster recovery and resilience..

I am often asked the difference between emergency, contingency and business continuity plans? The answer is that the very act of working through the process of planning for unwanted events, whatever they may be, is the most important factor. However, there are key nuances between each which, if not addressed, can seriously jeopardise businesses ability to operate.

Unequivocally, emergency plans are required where we need a response by one or more of the emergency services. Emergencies, by definition, are events which tend to happen quickly, rapidly getting worse e.g. a small unchallenged fire, can grow significantly. However, on invocation of the plan, the situation stabilises and then sees a gradual improvement.

Contingency plans are similar, where the event happens suddenly and can get rapidly worse. However, they do not require the attendance of the emergency services e.g. IT outages. Examples where a contingency plan could be required include, but not limited to:

• loss of power
• industrial action
• loss of IT.

Similarly, the event stabilises and gradually improves. However, both of these examples last a relatively short time span; possibly a few hours or in the worst cases, days. Rarely do we see protracted emergencies or crises. Conversely, the recovery time for business as usual to be restored, can be weeks, months or even years. Yet, much time is spent planning for ephemeral emergency or crisis events and relatively little time on recovery. This incongruous nature of planning, can lead to the potential long term damage of the business.

Disasters    

The 1980s was known as the ‘decade of disaster’. The second half of the eighties was a particularly catastrophic period in the UK, with incidents such as those shown in table 1:

The main concern around that period was that emergency planning legislation dated back to the Emergency Powers Act 1920. Emergency planning in the UK was focused on the cold war, concerning a nuclear attack. Following cessation of the cold war, the planning assumptions had to be changed immeasurably to address more modern day risks e.g. terrorism, climate change and the increased use of IT.

The Civil Contingencies Act 2004 replaced the outdated legislation and for the first time, legislation put a mandatory requirement on emergency responders to take account of business continuity to ensure that the emergency services could keep functioning when faced with unwanted events such as flooding of their premises. Moreover, the legislation also put statutory requirements on local authorities to provide guidance to local businesses on business continuity, especially small to medium enterprises.

This was an important aspect as, it is widely reported that following the Irish Republican Army (IRA) bombing in Manchester in 1996, around half of the businesses who did not have suitable plans in place, failed to exist within the following twelve months. Consequently, business continuity planning is a vitally important aspect of running any business, no matter how large or small.

In 2018 there were two unrelated major fires in Glasgow city centre which directly affected businesses in close proximity to the premises. The state of the structural integrity of the buildings meant that exclusion zones around the premises completely stopped access for the business owners and their customers for a protracted period.  

Where an individual is personally impacted they can clearly see this as a disaster. This is especially so where there is death within friends and family. However, the word disaster is often maligned e.g. ‘my hair is a disaster’ or ‘my dinner party was a complete disaster’ so when is a disaster actually a disaster? A disaster is a very personal thing!

The ‘Bradford Disaster Scale’ is utilised to determine when an event is officially a disaster. However, this is rarely used and in the world of 24/7 worldwide news coverage, it is the media who tend to declare when an event or incident is a disaster. This is not based on any algorithm or other model, but sensationalism, in an attempt to sell more newspapers.

Therefore, if we look back in history and even in more recent times, we find it littered with examples of organisations who failed to plan for the unexpected and ended up going out of business. The trick, obviously, is to convert what we know (hindsight), into what could potentially happen in the future (foresight) and to plan accordingly on what could potentially happen.

Clearly, only an emergency can lead to a disaster; however, not all events are designated as a disaster. Therefore, there is a need to identify the risks to the business – what can go wrong, how can it go wrong and what will happen if it does go wrong. Indeed, we can also argue that something seen as a risk to one person or organisation may indeed be an opportunity for others. Those businesses who plan accordingly, can readily identify the business opportunities open to them.

Resilience is an interesting turn of phrase which has become increasingly more used in modernity. We have heard the word utilised a great deal more over the past decade, by organisations such as the BBC News channels.

Therefore, what does ‘resilience’ mean and why is it becoming more widely used? A useful working definition taken from the English Oxford Living Dictionary is ‘the capacity to recover quickly from difficulties; the ability of a substance or object to spring back into shape (elasticity)’. We can, therefore, deduce, that resilience and business continuity planning are intrinsically linked and that careful planning and preparation can assist in achieving a resilient organisation.

International standards such as ISO 22301 are useful tools for organisations to assist in the planning and execution of a resilient organisation. ISO 22301 sets out a valuable framework to assess the impact that having a crisis event would have on the organisation. Whilst risk is a key component of the process, the focus is mainly on managing the consequences of crisis events and for restoring normality within a set timescale, or indeed, defining a new normality. 

Failing to plan for crisis situations could easily lead to a failure of the business. It is, therefore, essential that businesses identify their vulnerabilities including loss of IT and to plug any gaps before it is too late. Every day, we should think…what would we do right now if x,y or z happened? If you cannot answer that question, then you need a plan.

Too many organisations and indeed, senior executives and board members, have misconceptions around business continuity, disaster recovery and resilience, all of which are in essence the same thing. Consequently, it is time to ensure that the following words are wiped from the vocabulary: 

• ‘It won’t happen to us’
• ‘We will cope, we always do’
• ‘We are too big a company to fail’.

Do so at your peril!!!

Gillies Crichton. MSc. GIFireE. MBCI. SIRM – group head of assurance for AGS Airports Limited, based at Glasgow Airport

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Business continuity, contingency planning and disaster recovery: What’s the difference?

Learn the difference between business continuity, contingency planning & disaster recovery, and why it’s important for your business to plan for disruption.

Sometimes, unforeseen events can disrupt a business’s operations without notice. Your preparedness and response are very important at this time. 

Some businesses are prepared for these interruptions and have clear guidelines for returning to ‘business as usual’ with minimal downtime. Others are less prepared and suffer knockoff effects that can take a long time to recover from. 

Businesses must prepare for disruptive events with strategies that outline how to maintain core operations and recover quickly. This is where the fields of business continuity, contingency planning, and disaster recovery come in. 

These help businesses minimize the impact of catastrophic events by creating a detailed plan for operating through disruptions and returning to normal as soon as possible. It may seem like the three terms are interchangeable and refer to the same process, however, there are core differences between them. 

In this guide, we’ll examine why your business should plan for disruption, and the difference between business continuity, contingency planning, and disaster recovery.

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What is business continuity?

Business continuity outlines how a business will continue to operate during and after a disruptive event. Ideally, with as little downtime as possible. 

Disruptive events can refer to anything from natural disasters, war, or theft to cyber-attacks, the departure of a vital employee, or negative publicity. The COVID-19 pandemic highlighted a real need to be prepared for the unexpected. Business continuity can also plan for smaller events such as extended power outages.

A business continuity strategy can take into account things like:

• How a business will operate if it’s forced to relocate premises
• Plans for what to do if a supplier/contractor that’s heavily relied on leaves or is bankrupted
• Redeploying staff to different roles
• Working from home guidelines
• Data backup site locations & providers
• Maintaining operations during both short-term and long-term disruptions

A business continuity plan is more comprehensive than a disaster recovery plan and will contain detailed contingencies for all aspects of the business.  

What is disaster recovery?

Disaster recovery plans for how a business will return to normal after technology-related disasters such as power outages, natural events, cybercrimes, or human error (for example, accidental deletion of data). It’s essentially a guideline that outlines what measures a business will need to take to respond to events and transition back to regular operation as quickly as possible. 

Disaster recovery is usually a key component of a business continuity plan and focuses on restoring normal business function. It can take into account things like:

• How to re-establish office productivity as quickly as possible
• Manual workarounds when computer systems are down 
• How to recover from data loss or IT infrastructure failure
• Business cybersecurity measures
• Who will form the crisis management team 
• A recovery timeline 

Many companies have data backups in place, however, this does not constitute proper disaster recovery. Data backups are not useful when there are power outages or a natural disaster preventing access to that data. A proper disaster recovery plan should consider these circumstances and provide a strategy to work around them.  What is a contingency plan?

A contingency plan prepares businesses for disruptive events that could significantly affect their delivery of products and/or services. This could include the loss of a vital employee or significant supplier. 

Contingency plans usually consider risks that can affect critical business operations, such as cyber-attacks, data leaks, or supply chain issues. A contingency plan typically includes things like: 

• Events that trigger contingency measures
• A response that will be taken depending on the event
• Key tasks involved
• Rough timeline for restoring normal operations

Business continuity, contingency planning, and disaster recovery can sound very similar, and in many ways they are. The key difference between the three is when they take place:

• Contingency planning happens in advance to prepare for future incidents
• Business continuity provides a temporary solution during an incident
• Disaster recovery focuses on returning operations back to normal after an incident has taken place

Why your business should plan for disruptive events

If your business faces disruption without a proper plan in place, knock-on effects can be catastrophic. Taking the time to consider business continuity, contingency planning and disaster recovery can benefit your business in numerous ways by minimising the consequences of interruption.

1. Prevent financial loss

The most obvious result of disruptive events is financial loss. As a business is unable to continue delivering products and services while dealing with the incident, its bottom line can take a hit. Instead of focusing your resources on coming up with a plan during the event, plan ahead so that you can restore business function as quickly as possible. 

2. Peace of mind

Taking the time to create a business continuity, disaster recovery, or contingency plan provides peace of mind to employees. Knowing that there are clear policies and guidelines to follow in times of need relieves pressure and mitigates chaos during disruptive situations. 

3. Edge over competitors

Being able to restore normal operations as quickly as possible can give you an advantage over competitors as they struggle to figure out the situation. This can help your business stand out as a trustworthy and reliable industry leader, especially in the eyes of customers.

Start planning for disruption before it’s too late

Don’t wait until you need it, prepare for disruptive events before they happen so that your business can be guided through interruptions swiftly and calmly. We can help you plan for unforeseen circumstances, including cybersecurity and incident response to minimise data loss and downtime.

Get in touch with our team to find out how we can help you implement a business cybersecurity plan that allows you to operate with peace of mind.

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• Understand Business Continuity, Resiliency, and Contingency Planning

** Unlock Your Full Potential **

This blog post will cover the basics of Business Continuity Planning, Resilience, and Contingency Planning. All three concepts are essential, and focusing on just one area alone isn't enough.

Business Continuity Planning (BCP) is a process of identifying potential risks to a company's operations, developing strategies to mitigate those risks, and implementing those strategies into regular business practices. It helps companies manage their risk by preparing for the unexpected.

In an era where natural disasters are increasing in frequency and intensity, people need to plan ahead to avoid major disruptions that could impact the organization's financial position or cause physical property damage.

Contingency planning involves anticipating the events that may occur and what actions might need to be taken in response (Disaster Recovery Plan). The goal is to ensure that you take all necessary steps to protect employees, information, resources and assets from the effects of an event. Examples: Fire, flood, strike, earthquake, war, outages, cyber-attack, terrorist attack, pandemics, etc.

Resilience refers to the ability of an organization to continue operating effectively during times of uncertainty or adversity. It is the ability of business operations to adapt and respond to internal or external dynamic changes rapidly. Resilient organizations can recover more quickly than non-resilient ones because they have built processes that minimize downtime and keep customers happy during disruptions.

IBM White Paper "Resilient infrastructure: Improving your business resilience" defines six blocks of a resilient organization:

• Accessibility
• Diversification
• Autonomic Computing

A Contingency Plan is a plan devised for an outcome other than the usual (expected) plan. Events covered in the contingency plan are not as extreme as the Business Continuity Plan. Examples: Supplier going out of business, bankruptcy, price/currency fluctuations.

The contingency plan is to be implemented only if required. The risk that this type of event will occur is low, and therefore it is essential to keep resources ready to deal with this situation. But it is also possible to overestimate risks and prepare too much - so you don't end up wasting resources on something that never happens.

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• Contingency and business continuity planning best practices

Contingency and business continuity planning best practices – Beyond templates and checklists

Contingency planning is a broad term. in theory, any business continuity checklist can be developed around issues as mundane as organizing fire drills (don’t forget to take your laptop with you). but if the covid-19 crisis is any indication as to how quickly normal operations can be upended, today’s hr organizations should be thinking about and creating business continuity plans for a much wider range of scenarios..

Everything should be on the table, from the next pandemic to preventable and unpreventable scenarios alike. Think natural disasters, accidents, intentional acts, IT outages, you name it. In each case, lay out how operations and resources must be shifted, refocused, removed, or added to maintain as much business continuity as possible.

All this begs the question of where to begin.

The short answer is anywhere and everywhere, all at once, so the organization isn’t caught flat-footed, as so many were at the start of 2020. But the long answer is that there are several emergency-preparedness best practices that HR managers should adhere to in part or in sum to ensure business continuity in the face of a crisis. Keeping these best practices in mind will inform the foundation of a business continuity plan template that can be followed, expanded upon, or customized to fit any situation as it develops.

How to create a contingency plan: Critical elements

There’s power in communication and policy alike. So before developing tactical steps to suit any possible scenario, it’s important to think of contingency planning as encapsulating three ideas:

• What workers want, which is essentially the employee experience in an emergency situation;
• Perception, which comprises the rumors circulating about how the company is handling the situation; and
• Business needs, which is how the company is performing in terms of maintaining business continuity and serving customers effectively.

Where these three overlap is the feedback loop – when, where, how, with what frequency, and the authenticity of communication between the company and its employees about the adverse event or situation. 

Critical elements to consider in a contingency plan.

The feedback has to be timely, and whoever delivers the communication has to be honest and transparent.

Greg Selke, VP and HR value advisor, SAP SuccessFactors

“The feedback has to be timely, and whoever delivers the communication has to be honest and transparent,” says Greg Selke, vice president and HR value advisor for SAP SuccessFactors. And as part of any business continuity plan, he explains, the methods of communication need to be planned well in advance. If, in the aftermath of unfortunate events, HR managers are deciding whether to send an email or text message to employees, the action plan is already lagging. But the more important thing to remember about the model above, Selke notes, is that it can work as well for a company of 20 employees as for one of 200,000.

The model must, however, be underpinned by a robust examination and evolution of policy. That requires equal parts intelligence and agility, particularly for a situation like the COVID-19 pandemic, since no one knows what a return to normal even looks like, never mind if and when it will be possible. This should include everything from rethinking what  performance management  looks like to providing resources or even time off for employees to manage stress – or perhaps help with their school-age kids’ homework. It all speaks to a better  employee experience  while still holding workers accountable for results. Still, policy flexibility is essential.

Think of it like this. What if a company asks sales reps to arrange in-person meetings, but some feel it’s unsafe? Or what if the clients don’t want to be visited due to safety concerns? What about employees with disabilities or those at a higher risk of severe coronavirus symptoms? HR managers need to weigh all these types of scenarios and more as they augment emergency preparedness strategies with new policies. The employee experience of any situation is what should drive the business continuity response.

It’s only after the above three elements – what workers want, perception and business needs, and the overlapping feedback – are carefully considered that specific plans should be laid out.

Find the right framework: Common characteristics of continuity plans

There are multiple business continuity plan samples to be found online, all of which help lay out the types of steps and procedures for different types of companies, nonprofits, and public services – even schools. As an HR leader begins determining tactical steps in any of those frameworks to preserve the business amid several unfortunate scenarios, a few key components should stay front and center of plans that address both small- and large-scale situations.

While this is a broad and often overused term, in the context of business continuity it’s perhaps the most important consideration. It’s not just about people being able to work remotely; it’s about the company’s ability to communicate with everyone, wherever they are. Here are a few questions to start with: 

• Are emergency contacts in place for everyone?
• What are the key business-critical roles and who holds them?  
• Are there tools in place that ensure worker safety?  
• Do employees have the ability to view their personal data and manage  benefits , time off, and scheduling to adapt to the crisis at hand?  
• Does the organization have the ability to  gather clear insights  on what employees are thinking and expecting from the company so HR can take quick, appropriate action? 

The more HR leaders can think about agility in these terms and employ the proper tools (many of them interconnected and cloud-enabled), the easier it will be to develop a more comprehensive set of contingency plans.

Succession modeling 

When talking about business-critical roles, HR needs to be able to identify the required skills, potential successors, and alternates who can step in at a time of crisis. As part of contingency planning, HR professionals should be constantly imagining and reconfiguring the organization for certain and uncertain times alike. That means thinking about positions or even entire departments that might need to be moved, reconfigured, or reallocated under various business conditions and scenarios. It’s also important to have insight and analytics that lay out the wider effects any of these emergency-situation reconfigurations will have on the company – to payroll or diversity, for example. After all, realigning resources to fit with new goals will only go so far if it doesn’t deliver the cost savings required in leaner times or if it adversely affects diversity and inclusion – some of the most important considerations in any company’s long-term plans. 

Worker training

Most would file training, upskilling, and reskilling under agility (above), but in the context of business contingency planning, training takes on a different meaning. In terms of keeping operations running during uncertain times, having a  robust training program  in place well in advance of any crisis helps HR managers avoid frantic hiring when and if the corporate strategy needs to shift.  

By defining the types of jobs that will be necessary and the requisite skills for each, then instituting the appropriate learning tools, HR managers can set up, launch, and track the needed training programs. This may constitute  upskilling or reskilling initiatives  – or a combination of the two – in line with business objectives likely to arise in the face of specific emergency situations. Either way, this means setting the concept of skills at the center of the HR talent approach so that they are the foundation of both job descriptions and people’s careers – and are ready for further development before adverse conditions arise.

Realigning and reconnecting 

In times of normal operations, businesses tend to have little trouble setting goals and communicating them to employees. People tend to know the targets they’re working toward. However, when operations are disrupted by a pandemic, natural disaster, or some other short- or long-term situation, the goals tend to go out the window. But it’s not just about scaling back expectations. In order to preserve business continuity, objectives might have to be completely redefined, so it’s critical to  set new targets, communicate them clearly, and keep track  of how workers are performing toward those new objectives.  

It’s also important that everyone and everything is working in harmony, even mid-crisis. HR managers in particular should look for  digital toolkits  that help teams, departments, groups of employees, HR – really anyone – communicate and collaborate without the hassle of adding IT infrastructure. The more employees can share knowledge and information with one another quickly and easily in times of uncertainty, the more resilient the business will be. 

Balancing the business with the employee experience

While continuity planning is about having both the right mindset and set of tools in place so the company can pivot broadly or selectively in response to a crisis, HR managers must always walk the uncomfortable tightrope between employee advocacy and business strategy. At the same time, however, HR can’t and shouldn’t go it alone.

Effective preparedness requires input and buy-in throughout the organization – from the CEO to legal to finance to health and safety. HR should take the lead, but the best-prepared companies bring all the aforementioned functions to the table to plan and act accordingly so no one person – not even the CHRO – is making critical decisions in a vacuum. This approach not only puts the company in a better place for crises on the horizon, it underscores the unique role that HR plays in caring for employees while simultaneously honoring a commitment to ensure business continuity. Making accessible, intuitive technology a part of those plans only strengthens the understanding of HR’s mandate up and down the organization.

It shouldn’t take a once-in-a-generation earthquake or pandemic for everyone in the company to understand that. But if best practices are followed when developing continuity plans, a company’s preparedness will ensure business agility and resiliency in the short and long terms.

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Further reading

Mastering Contingency Planning: Expert Strategies, Proven Best Practices, and Testing Techniques for Optimal Results

By Joe Weller | May 9, 2023

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Successful organizations must understand potential risks and have contingency plans in place to address them. We’ve assembled expert tips on effective contingency planning and offer practical insights on how to test those contingency plans.

Included on this page, you’ll find the benefits of contingency planning , steps to take to create a contingency plan, examples of contingency plans , and information on a range of exercises your team can do to test its contingency plans.

What Is a Contingency Plan?

A contingency plan is a proactive strategy that outlines the actions a person or entity will take in response to a potential future event. Businesses often develop contingency plans to prepare for risks and mitigate their impact on the business.

What Is Business Contingency Planning?

Business contingency planning is work an organization does to determine how it responds to future events that might affect the business. The goal is to prepare an organization to respond to negative events and mitigate their impact on the business.

A business contingency plan is a written document that outlines an organization’s contingency planning efforts. It typically includes a comprehensive assessment of possible risks to the business and corresponding measures the organization has planned to mitigate these risks, such as legal and budget contingency.

Why Is a Business Contingency Plan Important?

A business contingency plan is crucial for any organization, as it helps them respond quickly and effectively to negative events. With a solid contingency plan in place, companies can minimize damages and continue to thrive even amid challenges.

While an organization might develop a contingency plan for risks to individual projects or general risks to the enterprise as a whole, business contingency plans refer specifically to general risks to the enterprise. This document details all of the most important risks that a business or organization faces.

In recent years, the importance of business contingency plans has increased significantly. With the rise of climate change, natural disasters have become more frequent and disruptive, underscoring the need for organizations to have effective contingency plans. In addition, the ever-growing threat of cybercrime has further highlighted the importance of contingency planning, as businesses increasingly rely on technology to operate.

“Before, you might have said, ‘What are the odds of a 100-year flood?’” says Luis Contreras, President and Principal Consultant for AzTech International , a California consultancy that helps organizations manage large, complex projects. “Well, they are happening more often now. ‘What are the odds of a cyber incident?’ Well, they're happening more often.”

Many organizations take steps in their risk management programs to try to completely eliminate certain risks. However, it’s almost impossible for any organization to completely eliminate the chance of a risk happening, says Erika Andresen,  a business continuity and resilience expert, author, and founder of EaaS Consulting . Business contingency planning is important, she says, “because your risk management will fail at a certain point.”

The Benefits of a Contingency Plan

Contingency plans offer several benefits to organizations. They enable organizations to respond promptly and effectively to unexpected events, minimize damages, and facilitate a quick recovery. With a contingency plan in place, organizations can take proactive measures to mitigate risks.

Here are some of the primary benefits of having a contingency plan in place:

• Improves Event Responsiveness: By having a clear plan in place, there is no confusion and individuals know how to react without blindly searching for direction. This enables the organization to take swift and effective action, minimizing response times and ensuring continuity of operations.

• Facilitates Quick Recovery: Organizations with good contingency plans bounce back quickly from negative events. For example, a severe storm or power outage might have a huge effect on a state or metropolitan area, but businesses that have backup generators and other contingency plans can often resume operations quickly. “It's resilience — it's how your company stays a company,” Andresen says. “That's how the company is able to grow and thrive. You've figured out that you're going to have a risk that is going to impact your operations. And then you worked and took the extra step to put in policies and procedures to get yourself back up and running with minimal disruption.”
• Decentralizes and Disseminates Important Information: Business contingency planning forces organization leaders to gather people to assess the organization’s potential response to various events. This work necessitates the sharing of important information about the company and its operations, resulting in more people knowing how to assist in the company’s response. Accessible, decentralized information is invaluable in a crisis event or when top leaders in a company suddenly leave.“If you have a company with one or two top leaders, then it makes it even more important,” says Lokenauth. “If one person has all the knowledge, when something happens to that one person, how does the company function?”
• Gives the Company Confidence in Its Operations: When you create effective contingency plans, you boost the confidence of everyone in the company. You instill a sense of trust that the company will respond well in an emergency. Moreover, you enhance confidence in the company’s overall preparedness, foresight, and integrity.

What Does a Contingency Plan Cover?

A contingency plan covers the important risks the organization is monitoring and any possible triggers to those risks. It also outlines the specific actions organization staff will take to respond to them.

A contingency plan often includes the following components:

• Triggering Events: Identify the events that can make a risk event more likely to happen, such as weather patterns or market conditions.
• Response Details: Outline specific actions the organization will take in response to a risk event, including preventive measures and mitigation strategies.
• Organizational Responsibilities: Detail the roles and responsibilities of key personnel within the organization, such as the crisis management team and first responders. This might include a RACI chart that outlines who is responsible, accountable, consulted, or informed about specific response actions.
• Key Contacts: Include contact information for key people or organizations that will be involved in the response efforts, such as emergency services, suppliers, and customers.
• Outside Experts: Identify outside experts or consultants the organization might need to engage for help when responding to the risk event, such as legal advisors, public relations firms, or technical specialists.
• Response Timeline: Include a timeline that details when certain responses need to happen, such as when to activate the crisis management team, notify stakeholders, or implement recovery measures.

Learn more about important components and how to write an effective contingency plan in this all-inclusive guide to writing contingency plans.

How to Develop a Contingency Plan

Developing a contingency plan begins with identifying and assessing potential risks. Next, teams outline an appropriate response to each risk, including specific actions that need to be taken and who will be responsible for executing those actions.

Steps in Business Contingency Planning

To develop an effective contingency plan, businesses need to follow some critical steps. The process starts with identifying and assessing potential risks and creating a response plan. Teams should then be trained on the plan and continually monitor potential risks.

These are the important steps to creating an effective contingency plan:

• Identify and Assess Risks: Identify potential risks that could have the most significant impact on your organization. This assessment might involve conducting a business risk analysis to evaluate potential threats, vulnerabilities, and consequences. Learn more about this step in the contingency planning process in this comprehensive guide to risk mitigation .
• Identify Resources: Identify what resources your organization already has that can help with contingency responses. This might include people, tools, or services that can be used to respond quickly to an unexpected event. Gather and coordinate those resources.
• Create Contingency Plans: Create a contingency plan for each risk that your organization has identified as critical. This plan should outline specific actions that need to be taken, who will be responsible for those actions, and a timeline for executing the plan.
• Seek Input and Secure Approvals: Get input from stakeholders and people within your organization on your draft contingency plans. Once you’ve gathered feedback, finalize plans and get approval from the organization’s leaders.
• Share Your Plans: Communicate your contingency plans to all relevant stakeholders within your organization. This includes making sure that everyone understands what the plans are, what their role is in executing the plans, and any necessary training or resources required to implement them.
• Perform Training Exercises: Train all relevant staff members on the contingency plans, and make sure they understand their roles in executing them. To test the effectiveness of the plans, perform exercises or drills that simulate potential risk events.
• Monitor Risks and Contingency Plans: ​​Regularly review and assess business risks to ensure that your contingency plans remain effective and relevant. Evaluate whether the current plan provides the best response to potential risks and consider making updates or modifications as necessary.
• Create New or Adjusted Contingency Plans as Needed: If your monitoring indicates that your contingency plans require adjustments, take action and promptly update them.

Business Contingency Planning Grid Template

Download a Sample Business Contingency Planning Grid Template for  Excel | Microsoft Word

Download a Business Contingency Planning Grid Template for  Excel | Microsoft Word

Download this business contingency planning grid template to assist your team in identifying potential risks to consider in your organization’s business contingency planning. This template provides a comprehensive list of broad risk categories and specific risks within those categories. By using this tool, you can evaluate which risks are relevant to your organization and develop appropriate contingency plans.

Contingency Planning for IT

Contingency planning in IT follows the same basic steps as other organizations. However, it often begins with a contingency planning policy statement , which outlines an organization’s broad approach to contingency planning.

What to Include in a Contingency Planning Policy Statement

A contingency planning policy statement is a document that outlines how an organization will perform contingency planning. It includes details on objectives, roles and responsibilities, resource and training requirements, testing schedules, and data backup and storage plans.

A contingency planning policy statement should include the following components:

• Objectives: Describe the organization's overall contingency planning objectives — for example, what types of risks the organization is preparing to address and how the organization's contingency planning efforts align with its overall business goals.
• Roles and Responsibilities: Outline the specific roles and responsibilities for performing contingency planning within the organization. This should include both high-level positions and specific individuals who will be responsible for carrying out different components of the plan.
• Organizational Functions and Departments: Identify which organizational functions and departments will be responsible for performing contingency planning. This helps ensure that all relevant areas of the organization are involved in the planning process.
• Resource Requirements: Determine the resources needed to support contingency planning efforts, including funding, personnel, equipment, and other necessary resources.
• Employee Training Requirements: Develop a plan for training employees on their roles and responsibilities in the event of a contingency situation. This might include both general training on contingency planning concepts and specific training on the organization's specific plan.
• Schedules of Exercises and Tests: Establish a schedule for conducting exercises and tests of contingency plans to ensure that they are effective.
• Procedures for Maintaining and Updating: Develop procedures for maintaining and updating contingency plans over time, including regular reviews and updates to reflect changes in the organization's risk landscape or other relevant factors.
• Data Backup and Storage: Determine how the organization will back up and store all electronic data to ensure that critical information is not lost in the event of a contingency situation.

A Contingency Plan Model for IT

The National Institute of Standards and Technology (NIST) has created SP 800-34, a popular contingency plan guide for IT. The guide outlines the steps and considerations that organizations should take when developing, implementing, and maintaining an effective contingency plan.

The SP 800-34 guide covers the entire contingency planning process, from risk assessment to plan testing and maintenance. It is widely used as a reference by government agencies, private organizations, and security professionals.

IT Preventive Controls

Any organization’s IT contingency plan should include preventive controls. These are measures an organization can take to prevent interruptions to information services or technology.

 Here are some basic IT preventive controls recommended by the NIST for federal information systems:

• Uninterruptible power supplies (UPS): To provide short-term backup power to all components, appropriate for the size of your system.
• Fuel-powered generators: To provide power over the longer term.
• Air-conditioning systems: Establish adequate capacity to prevent failure of components that malfunction when overheated.
• Fire and smoke detectors: Install in appropriate locations.
• Fire suppression systems: Install to minimize potential damages.
• Water sensors: Place in the ceiling and floor of rooms where computer equipment is located.
• Containers for backup media and vital non-digital records: Ensure they are heat resistant and waterproof.
• Master system shutdown switch: Make available for emergencies.
• Off-site storage areas: Use them for backup media, system documentation, and important non-digital records.
• Technical security controls: This includes management of cryptographic keys.
• Frequent scheduled backups of data: This includes information on where the backups are stored, onsite and offsite.

Examples of Contingency Plans

Contingency plan examples can help your team understand what to consider in creating a plan and the important components to include.

You can learn more about contingency planning and download blank and example contingency plans.

Business Contingency Planning Best Practices

To improve your organization’s business contingency planning, experts recommend following a number of best practices, such as performing an effective risk assessment, training employees on the plan, and conducting exercises to test the plan.

These are some best practices to follow for effective business contingency planning:

• Perform Good Risk Assessment and Analysis: Your team should identify the most critical risks through a thorough risk assessment. This includes analyzing the potential impact of each risk and determining which risks require a comprehensive contingency response.
• Ensure All Team Members Are Aware of Contingency Plans: Contingency plans will not be effective if the employees in your organization are not aware or have only a vague understanding of them. Incorporate contingency planning into employee training and orientation programs, and communicate regular reminders and updates on the plans through team meetings, newsletters, and other internal communication channels.
• Train Staff and Conduct Regular Drills: Your organization should train all employees responsible for specific tasks in the plan. Conducting exercises or drills where employees simulate a risk event scenario can help teams identify potential gaps or issues in the plan and improve its effectiveness. Many organizations will complete a business continuity or contingency plan, then “put it on a shelf and say, ‘OK, I did it.’ No, you didn’t,” says Andresen. “You haven't done it. You don’t know what’s in it. You don’t have the muscle memory for what the procedures are. When the disaster happens, you don’t want to be saying, ‘Hold on, let me flip through the pages.’ That's another integral part to business continuity planning or contingency planning: to train the plan and exercise the plan. That’s how you figure out if the plan works.”
• Continually Review Plans and Make Necessary Adjustments: Drills and exercises are crucial to contingency planning, as they allow organizations to identify which contingency are ineffective and need to be revised. It is essential to modify plans when necessary, whether due to changing risks or other factors. After conducting a drill on a contingency plan, Andresen advises, “Go back and relook at the plan and say, ‘OK, we did this well. This didn't work. This needs to be improved.’” By doing so, teams can ensure that their contingency plans actually work. “This is why this needs to be revisited continuously so that the plan is not just a heavy paperweight,” says Andresen. “Don't break your arm patting yourself on the back that you've accomplished making the plan — actually do something with it.”

Types of Exercises to Test Your Contingency Plan

Conducting a variety of drills and exercises for contingency plans is essential for organizations that want to be prepared for any potential risks. The following chart outlines different types of exercises that can test and improve your contingency plans.

Common Contingency Planning Pitfalls to Avoid

To achieve effective contingency planning, it is important to be aware of common challenges and pitfalls. One such challenge: organizations not allocating sufficient resources to planning and executing responses that are part of the plans.

These are some of the most common challenges and pitfalls to avoid:

• Lack of Resources Devoted to Contingency Planning and Actions: To create effective contingency plans, organizations must allocate staff time and resources for both planning and response. This includes significant resources to execute the actions required in response to a risk event. Neglecting these necessary resources can result in ineffective contingency plans and costly responses to risks.
• Lack of Buy-in From Organizational Leaders: Lack of buy-in from organizational leaders often results in a lack of resources. Leaders who don’t value contingency planning might not provide the necessary funding, time, or attention to ensure the plans are effective. This can result in plans that are incomplete, inadequate, or not tested or updated regularly. “Every level of employee is going to look at leadership and see if they take this seriously,” Andresen says. “Is this some simple extra duty? If leadership is saying, ‘No, this is really important, and this is why this is important,’ they get the employees behind that. Then the employees are going to take it seriously.”
• Bias Against Plan B Thinking: Contingency planning assumes that at some point, an organization’s mission is going to fail. Unfortunately, some organizational leaders have a bias against this, as they perceive it as thinking about a Plan B. However, these leaders must work to understand that having contingency plans is vital for the organization’s future and doesn’t reflect a lack of confidence in Plan A.
• One-and-Done Contingency Plans: According to Andresen, organizations often develop contingency plans because they are deemed useful or someone within the organization encourages their development. However, these contingency plans are often completed, then disregarded. In order for contingency plans to be effective, organizations must share them widely, train their employees on them, and continuously adapt them to changing circumstances.

Effective vs. Ineffective Contingency Planning Example

The table below demonstrates the varying outcomes between a well-considered contingency plan and one that is less so. The consequences of these differing results can be significant for both the organization and the community.

Resource and Environment at Risk: An oil production facility has above-ground oil flowlines that run for 7,000 feet. The facility is located half a mile west of a major creek and six miles north of a river. The creek flows into the river, which flows into a town of 150,000 people located 12 miles away.

Contingency Plan Purpose: Detect and mitigate any significant oil leak from the facility's flowlines, with the goal of minimizing environmental damage. The plan places a special emphasis on preventing oil from reaching the nearby creek or river.

Business Contingency Plan vs. Business Continuity Plan

A business continuity plan and a business contingency plan share some similarities, but a business continuity plan primarily focuses on how an organization can continue operations during an emergency, whereas a contingency plan addresses a broader range of risks.

• Business Continuity Plan: A business continuity plan outlines the steps an organization will take to maintain normal operations following a major and disruptive event, such as an earthquake, fire, or major data breach.
• Business Contingency Plan: A business contingency plan covers a broader range of risks that an organization might face and outlines how the organization plans to respond. These risks can include potential major disruptions or events that might not directly affect operations but still require an effective response.

Business Contingency Plan vs. Project Risk Management Plan

Business contingency plans and project risk management plans both identify potential risks and determine ways to respond to them. The former focuses on risks to the entire organization, while the latter focuses on risks to a particular project.

In a project risk management plan , teams identify and assess possible risks to a specific project. It then determines how project leaders can respond to, eliminate, or mitigate those risks.

A business contingency plan identifies potential threats to an organization's ability to continue operating. It assesses risks that could temporarily or permanently halt operations, and then outlines plans to mitigate or eliminate those risks.

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What Is A Business Continuity Plan? [+ Template & Examples]

Published: December 30, 2022

When a business crisis occurs, the last thing you want to do is panic.

The second-to-last thing you want to do is be unprepared. Crises typically arise without warning. While you shouldn't start every day expecting the worst, you should be relatively prepared for anything to happen.

A business crisis can cost your company a lot of money and ruin your reputation if you don't have a business continuity plan in place. Customers aren't very forgiving, especially when a crisis is influenced by accidents within the company or other preventable mistakes. If you want your company to be able to maintain its business continuity in the face of a crisis, then you'll need to come up with this type of plan to uphold its essential functions.

In this post, we'll explain what a business continuity plan is, give examples of scenarios that would require a business continuity plan, and provide a template that you can use to create a well-rounded program for your business.

Table of Contents:

What is a business continuity plan?

• Business Continuity Types
• Business Continuity vs Disaster Recovery

Business Continuity Plan Template

How to write a business continuity plan.

• Business Continuity Examples

A business continuity plan outlines directions and procedures that your company will follow when faced with a crisis. These plans include business procedures, names of assets and partners, human resource functions, and other helpful information that can help maintain your brand's relationships with relevant stakeholders. The goal of a business continuity plan is to handle anything from minor disruptions to full-blown threats.

For example, one crisis that your business may have to respond to is a severe snowstorm. Your team may be wondering, "If a snowstorm disrupted our supply chain, how would we resume business?" Planning contingencies ahead of time for situations like these can help your business stay afloat when you're faced with an unavoidable crisis.

When you think about business continuity in terms of the essential functions your business requires to operate, you can begin to mitigate and plan for specific risks within those functions.

Crisis Communication and Management Kit

Manage, plan for, and communicate during your corporate crises with these crisis management plan templates.

• Free Crisis Management Plan Template
• 12 Crisis Communication Templates
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• Additional Crisis Best Management Practices

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Click this link to access this resource at any time.

Business Continuity Planning

Business continuity planning is the process of creating a plan to address a crisis. When writing out a business continuity plan, it's important to consider the variety of crises that could potentially affect the company and prepare a resolution for each.

Type: Workforce

Let's say that you have a rockstar on your leadership team. With extreme performance comes opportunity, and that rockstar may decide to leave your organization to pursue employment elsewhere.

Are there critical business functions that only this employee knows how to do, or do you have a cross-functional team who can take on the work should they decide to leave? How does this impact the workflow of the company, especially if it takes time to fill the role with someone else?

It all comes down to resource management and making sure that you can adapt to workforce changes in an agile way.

However, this is often easier said than done, and here are some examples of threats to your workforce continuity:

• Staffing issues
• The turnover of a critical employee
• Work stoppages and/or strikes
• Interpersonal conflict
• Not scaling and formalizing your systems and processes

The chart above outlines how you can help your company prepare for employee departures by having a successor plan in place ahead of time.

5. Business Continuity Plan Example for Workplace Emergencies

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Contingency Planning Explained: Risk, Incident Response, Disaster Recovery, and Business Continuity Plans

Risk planning, incident response planning, disaster recovery planning, and business continuity planning will be discussed here. An extra emphasis will be placed on the distinctions among the plans. A brief overview will be given followed by an outline used to facilitate the visualization of all the separate pieces and keep the focus on dissimilarity.

This is a big topic with discrete parts. The problem is that most people tend to lump all of the parts into one big confused mess. Hopefully this will clear things up a bit.

Believe it or not, there is a process to contingency planning. It all starts with risk identification. This can be done via vulnerability assessments or penetration tests and threat assessments. Once risks are identified they are assessed and classified. This will determine how probable and devastating the risk might be; it also identifies the risk as a physical, technical, natural, or person risk. Ranking risks helps ensure that the most resources go to the most prominent risks.

Incident response planning is the next step. Incident response plans assume that a threat will be realized. One plan should be made for each threat that does not constitute a disaster to the business. It’s best to plan for the process of mitigation, response, and recovery using the before, during, and after approach. The before plan lists steps taken to mitigate and prepare for an incident; the during plan lists steps taken to absolve the threat; the after plan lists steps taken to recover after the threat has been handled. Incident response plans focus on the threats that will not jeopardize business operations.

Disaster recovery plans are similar to incident response plans, except that they do focus on the threats that devastate business operations. These also include things like fire and natural causes. Incidents can escalate to disasters if the business impact is great enough. These, too, are best addressed in the context of before, during, and after.

For every disaster plan, there should be a business continuity plan. Business continuity plans are plans to keep the company operating (generating revenue) in light of a disaster. Whereas disaster recovery plans focus on fixing what broke, business continuity plans focus on maintaining business operability while the fixes are made. Redundancies play a large role in business continuity planning. Having a hot, warm, or cold site is a common approach to achieving redundancy.

The outline is numbered to indicate parent/child relationships between the various plans so it is obvious which plans need to occur first and how they are triggered or escalated:

1. Risk identification – vulnerability assessment – penetration test – threat assessment 2. Risk assessment and classification – risk ranking – business impact analysis – mitigation costs – recovery costs 4. Incident response planning – non-devastating threats – mitigate, respond, recover 5. Disaster recovery planning – devastating threats – mitigate, respond, recover 6. Business continuity planning – keep operations running during disaster response and recovery

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• Business strategy |
• What is a contingency plan? A guide to ...

What is a contingency plan? A guide to contingency planning

A business contingency plan is a backup strategy for your team or organization. It lays out how you’ll respond if unforeseen events knock your plans off track—like how you’ll pivot if you lose a key client, or what you’ll do if your software service goes down for more than three hours. Get step-by-step instructions to create an effective contingency plan, so if the unexpected happens, your team can spring into action and get things back on track.

No one wants Plan A to fail—but having a strong plan B in place is the best way to be prepared for any situation. With a solid backup plan, you can effectively respond to unforeseen events effectively and get back on track as quickly as possible. 

A contingency plan is a proactive strategy to help you address negative developments and ensure business continuity. In this article, learn how to create a contingency plan for unexpected events and build recovery strategies to ensure your business remains healthy.

What is contingency planning?

What is a contingency plan .

A contingency plan is a strategy for how your organization will respond to important or business-critical events that knock your original plans off track. Executed correctly, a business contingency plan can mitigate risk and help you get back to business as usual—as quickly as possible. 

You might be familiar with contingency plans to respond to natural disasters—businesses and governments typically create contingency plans for disaster recovery after floods, earthquakes, or tornadoes. 

But contingency plans are just as important for business risks. For example, you might create a contingency plan outlining what you will do if your primary competitors merge or how you’ll pivot if you lose a key client. You could even create a contingency plan for smaller occurrences that would have a big impact—like your software service going down for more than three hours.

Contingency planning vs risk management

Project risk management is the process of identifying, monitoring, and addressing project-level risks. Apply project risk management at the beginning of the project planning process to prepare for any risks that might come up. To do so, create a risk register to identify and monitor potential project risks. If a risk does happen, you can use your risk register to proactively target that risk and resolve it as quickly as possible. 

A contingency plan is similar to a project risk management plan or a crisis management plan because it also helps you identify and resolve risks. However, a business contingency plan should cover risks that span multiple projects or even risks that could affect multiple departments. To create a contingency plan, identify and prepare for large, business-level risks.

Contingency planning vs crisis management

Contingency planning is a proactive approach that prepares organizations for potential emergencies by implementing pre-planned risk mitigation strategies. It involves identifying threats and crafting strategies in advance. 

Crisis management , on the other hand, is reactive, focusing on immediate response and damage control when a crisis occurs. While contingency planning sets the stage for effective handling of emergencies, crisis management involves real-time decision-making and project management during an actual crisis. Both are important for organizations and businesses to maintain their stability and resilience.

Contingency plan examples

There are a variety of reasons you’d want to set up a contingency plan. Rather than building one contingency plan, you should build one plan for each type of large-scale risk or disaster that might strike. 

Business contingency plan

A business contingency plan is a specialized strategy that organizations develop to respond to particular, unforeseen events that threaten to disrupt regular operations. It's kind of like a business continuity plan, but there's one key difference. 

While business continuity plans aim to ensure the uninterrupted operation of the entire business during a crisis, a business contingency plan zeroes in on procedures and solutions for specific critical incidents, such as data breaches, supply chain interruptions, or key staff unavailability. 

A business contingency plan could include:

Strategies to ensure minimal operational disruption during crises, such as unexpected market shifts, regulatory compliance changes, or severe staff shortages.

Partnerships with external agencies that can provide support in scenarios like environmental hazards or public health emergencies.

A comprehensive communication strategy with internal and external stakeholders to provide clear, timely information flow during crises like brand reputation threats or legal challenges.

Environmental contingency plan

While severe earthquakes aren’t particularly common, being unprepared when “the big one” strikes could prove to be catastrophic. This is why governments and businesses in regions prone to earthquakes create preparedness initiatives and contingency plans.

A government contingency plan for an earthquake could include things like: 

The names and information of the people designated to handle certain tasks in advance to ensure the emergency response is quick and concise

Ways to educate the public on how to respond when an earthquake hits

A timeline for emergency responders.

Technology contingency plan

If your business is particularly data-heavy, for example, ensuring the safety and cybersecurity of your information systems is critical. Whether a power surge damages your servers or a hacker attempts to infiltrate your network, you’ll want to have an emergency response in place.

A business’s contingency plan for a data breach could involve: 

Steps to take and key team members to notify in order to get data adequately secured once more

The names and information of stakeholders to contact to discuss the impact of the data breach and the plan to protect their investment

A timeline to document what is being done to address the breach and what will need to be done to prevent data breaches in the future

Supply chain contingency plan

Businesses that are integral parts of the supply chain, such as manufacturing entities, retail companies, and logistics providers, need an effective supply chain contingency plan to continue functioning smoothly under unforeseen circumstances.

These plans hedge against supply chain disruptions caused by events like natural disasters or technological outages and help organizations reduce downtime and ensure real-time operational capabilities. 

A supply chain contingency plan could include:

Secure critical data and systems while promptly notifying key team members, such as IT staff and management, for immediate action.

A predetermined list of essential stakeholders, including suppliers, customers, investors, and authorities, should be contacted to inform them about the disruption and steps being taken.

A detailed timeline is essential for documenting the immediate response and outlining long-term strategies to prevent future disruptions in the supply chain.

Pandemic contingency plan

In the face of a global health crisis, a pandemic contingency plan is vital for organizations in healthcare, retail, and manufacturing. This plan focuses on mitigation strategies to minimize operational disruptions and ensure the safety of employees while maintaining business continuity. 

A pandemic response plan could include:

A comprehensive health and safety protocol for employees, which integrates regular health screenings, detailed risk analysis, and emergency medical support as key components.

Flexible work arrangements and protocols for remote operations and digital communication.

A list of key personnel and communication channels for immediate response and coordination.

Regularly reviewing and adapting the pandemic contingency plan as part of an ongoing disaster recovery plan to address evolving challenges and lessons learned.

How to create a contingency plan

You can create a contingency plan at various levels of your organization. For example, if you're a team lead, you could create a contingency plan for your team or department. Alternatively, company executives should create business contingency plans for situations that could impact the entire organization. 

As you create your contingency plan, make sure you evaluate the likelihood and severity of each risk. Then, once you’ve created your plan—or plans—get it approved by your manager or department head. That way, if a negative event does occur, your team can leap to action and quickly resolve the risk without having to wait for approvals.

1. Make a list of risks

Before you can resolve risks, you first need to identify them. Start by making a list of any and all risks that might impact your company. Remember: there are different levels of contingency planning—you could be planning at the business, department, or program level. Make sure your contingency plans are aligned with the scope and magnitude of the risks you’re responsible for addressing. 

A contingency plan is a large-scale effort, so hold a brainstorming session with relevant stakeholders to identify and discuss potential risks. If you aren’t sure who should be included in your brainstorming session, create a stakeholder analysis map to identify who should be involved.

2. Weigh risks based on severity and likelihood

You don’t need to create a contingency plan for every risk you lay out. Once you outline risks and potential threats, work with your stakeholders to identify the potential impact of each risk. 

Evaluate each risk based on two metrics: the severity of the impact if the risk were to happen and the likelihood of the risk occurring. During the risk assessment phase, assign each risk a severity and likelihood—we recommend using high, medium, and low. 

3. Identify important risks

Once you’ve assigned severity and likelihood to each risk, it’s up to you and your stakeholders to decide which risks are most important to address. For example, you should definitely create a contingency plan for a risk that’s high likelihood and high severity, whereas you probably don’t need to create a contingency plan for a risk that’s low likelihood and low severity. 

You and your stakeholders should decide where to draw the line.

4. Conduct a business impact analysis

A business impact analysis (BIA) is a deep dive into your operations to identify exactly which systems keep your operations ticking. A BIA will help you predict what impact a specific risk could have on your business and, in turn, the response you and your team should take if that risk were to occur. 

Understanding the severity and likelihood of each risk will help you determine exactly how you will need to proceed to minimize the impact of the threat to your business. 

For example, what are you going to do about risks that have low severity but high likelihood? What about risks that are high in severity, but relatively low in likelihood? 

Determining exactly what makes your business tick will help you create a contingency plan for every risk, no matter the likelihood or severity.  

5. Create contingency plans for the biggest risks

Create a contingency plan for each risk you’ve identified as important. As part of that contingency plan, describe the risk and brainstorm what your team will do if the risk comes to pass. Each plan should include all of the steps you need to take to return to business as usual.

Your contingency plan should include information about:

The triggers that will set this plan into motion

The immediate response

Who should be involved and informed?

Key responsibilities, including a RACI chart if necessary

The timeline of your response (i.e. immediate things to do vs. longer-term things to do)

For example, let’s say you’ve identified a potential staff shortage as a likely and severe risk. This would significantly impact normal operations, so you want to create a contingency plan to prepare for it. Each person on your team has a very particular skill set, and it would be difficult to manage team responsibilities if more than one person left at the same time. Your contingency plan might include who can cover certain projects or processes while you hire a backfill, or how to improve team documentation to prevent siloed skillsets. 

6. Get approval for contingency plans

Make sure relevant company leaders know about the plan and agree with your course of action. This is especially relevant if you’re creating team- or department-level plans. By creating a contingency plan, you’re empowering your team to respond quickly to a risk, but you want to make sure that course of action is the right one. Plus, pre-approval will allow you to set the plan in motion with confidence—knowing you’re on the right track—and without having to ask for approvals beforehand.

7. Share your contingency plans

Once you’ve created your contingency plans, share them with the right people. Make sure everyone knows what you’ll do, so if and when the time comes, you can act as quickly and seamlessly as possible. Keep your contingency plans in a central source of truth so everyone can easily access them if necessary.

Creating a project in a work management platform is a great way of distributing the plan and ensuring everyone has a step-by-step guide for how to enact it.

8. Monitor contingency plans

Review your contingency plan frequently to make sure it’s still accurate. Take into account new risks or new opportunities, like new hires or a changing business landscape. If a new executive leader joins the team, make sure to surface the contingency plan for their review as well. 

9. Create new contingency plans (if necessary)

It’s great if you’ve created contingency plans for all the risks you found, but make sure you’re constantly monitoring for new risks. If you discover a new risk, and it has a high enough severity or likelihood, create a new contingency plan for that risk. Likewise, you may look back on your plans and realize that some of the scenarios you once worried about aren’t likely to happen or, if they do, they won’t impact your team as much.

Common contingency planning pitfalls—and how to avoid them

A contingency plan is a powerful tool to help you get back to normal business functions quickly. To ensure your contingency planning process is as smooth as possible, watch out for common pitfalls, like: 

Lack of buy-in

It takes a lot of work to create a contingency plan, so before you get started, ensure you have support from executive stakeholders. As you create your plan, continuously check in with your sponsors to ensure you’ve addressed key risks and that your action plan is solid. By doing so, you can ensure your stakeholders see your contingency plan as something they can get behind.

Bias against “Plan B” thinking

Some company cultures don’t like to think of Plan B—they like to throw everything they have at Plan A and hope it works. But thinking this way can actually expose your team to more risks than if you proactively create a Plan B.

Think of it like checking the weather before going sailing so you don’t accidentally get caught in a storm. Nine times out of ten, a clear sunny day won’t suddenly turn stormy, but it’s always better to be prepared. Creating a contingency plan can help you ensure that, if a negative event does occur, your company will be ready to face it and bounce back as quickly as possible. 

One-and-done contingency plans

It takes a lot of work to put a contingency plan together. Sometimes when you’ve finished, it can be tempting to consider it a job well done and forget about it. But make sure you schedule regular reminders (maybe once or twice a year) to review and update your contingency plan if necessary. If new risks pop up, or if your business operations change, updating your contingency plan can ensure you have the best response to negative events.  

You’ve created a contingency plan—now what?

A contingency plan can be a lot of work to create, but if you ever need to use it, you’ll be glad you made one. In addition to creating a strong contingency plan, make sure you keep your plan up-to-date.

Being proactive can help you mitigate risks before they happen—so make sure to communicate your contingency plan to the team members who will be responsible for carrying them out if a risk does happen. Don’t leave your contingency plan in a document to collect dust—after creating it, you should use it if need be!

Once you’ve created the plan, make sure you store it in a central location that everyone can access, like a work management platform . If it does come time to use one of your contingency plans, storing them in a centrally accessible location can help your team quickly turn plans into action.

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Understanding the Essentials of a Business Continuity Plan

In the face of unforeseen disruptions, a robust business continuity plan (BCP) is essential to preserve the trust of stakeholders. If you are able to seamlessly continue operations even in the face of sudden challenges, stakeholders are reassured of the company’s resilience and commitment to their interests.

In this blog post, we offer a comprehensive guide to business continuity planning, how it can benefit organizations and share key insights into Developing and Maintaining an Effective business continuity plan.

What is a Business Continuity Plan?

A business continuity plan (BCP) is an essential blueprint that outlines how a company will continue operating during an unplanned disruption in service. It’s more than just a reactive strategy; it’s a proactive measure to ensure that critical business functions can continue during and after a crisis. The purpose of a BCP is to provide a systematic approach to mitigate the potential impact of disruptions and maintain business operations at an acceptable predefined level.

The role of a BCP is crucial in maintaining operations during unforeseen events such as natural disasters, cyber-attacks, or any other incident that could interrupt business processes. By having a well-structured business continuity plan, organizations can:

• Minimize downtime and ensure that essential functions remain operational
• Protect the integrity of data and IT infrastructure
• Maintain customer service and preserve stakeholder trust

Why is a Business Continuity Plan Important

Immediate Response : A BCP ensures that there is a predefined action plan, minimizing downtime and demonstrating control over the situation.

Transparent Communication : Keeping stakeholders informed during a crisis promotes transparency and maintains confidence in the company’s management.

Inclusive Planning : Involve stakeholders in the business continuity plan development process. Their insights can enhance the plan’s effectiveness and ensure their needs are addressed.

Consistency in Service : By prioritizing critical operations, a BCP helps maintain the quality and consistency of services or products, which is important for customer retention.

The absence of a business continuity plan can lead to a domino effect of negative outcomes, including a tarnished reputation and the potential loss of future business. Stakeholders remember how a company responds in a crisis, and a well-executed BCP can be the difference between a temporary setback and a long-term impact on the company’s image and relationships.

Elements of a Business Continuity Plan

When exploring various business continuity plan examples, certain common elements emerge as critical for their effectiveness. These elements serve as the backbone for a robust BCP plan, ensuring that businesses can maintain operations and protect their reputation during unforeseen events. Here are some of the key components found in successful BCP examples:

Risk Assessment and Business Impact Analysis : Identifying potential threats and assessing their impact on business operations is a foundational step in any BCP plan.

Crisis Communication Plan : A clear communication strategy is essential to manage stakeholder expectations and maintain trust.

Recovery Strategies : Detailed procedures for restoring business functions and services post-disruption are indispensable.

Employee Training and Awareness : Ensuring staff are well-prepared and knowledgeable about the BCP plan is crucial for its successful implementation.

Case studies of successful BCP implementations often highlight how these elements are tailored to fit specific business models and industries. For instance, a financial institution may focus heavily on data security and regulatory compliance within their BCP, while a manufacturing business might prioritize supply chain alternatives and on-site safety protocols. Regular testing and adjustment of these plans are also a common thread, underscoring the importance of adaptability and continuous improvement in business continuity planning.

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Business Continuity vs. Disaster Recovery

It’s important to distinguish between a business continuity plan and a disaster recovery plan. While both are vital, a BCP is broader and focuses on the continuity of the entire business, whereas a disaster recovery plan is more technical and concentrates on the recovery of specific operations, such as IT services. Understanding these differences helps organizations allocate resources effectively and ensures comprehensive preparedness for any type of disruption. Understanding when to activate a business continuity plan (BCP) versus a disaster recovery plan is crucial for maintaining operational resilience.

To ensure a comprehensive crisis management strategy, consider the following integration points:

Pre-emptive Planning : Establish clear triggers for when each plan is activated. For instance, a BCP might be initiated in the face of a supply chain disruption, while disaster recovery would come into play during a data breach or server failure.

Unified Communication : Both plans should have a coordinated communication strategy to inform stakeholders and employees about the status and steps being taken.

Regular Testing : Conduct joint drills that test both the BCP and disaster recovery plans to identify any gaps or overlaps in procedures.

Continuous Improvement : Use insights from drills and actual incidents to refine both plans, ensuring they evolve with the changing business landscape and technological advancements.

By integrating both plans, organizations can navigate crises with agility and confidence, minimizing downtime and protecting their reputation. Tools like Creately, with features such as real-time collaboration and visual project management, can help create and maintain these critical plans, ensuring that all stakeholders are on the same page and ready to act when necessary.

Crisis Communication Strategies within Business Continuity Planning

A business continuity plan (BCP) is not just about responding to the crisis at hand, but also about how you communicate during the disruptions and the decisions you make. Here are some best practices to ensure your crisis communication and decision-making processes effective:

Clear Communication Channels : Establish predefined channels for internal and external communication. This ensures that messages are consistent and reach all stakeholders promptly.

Designated Spokespersons : Identify individuals who are authorized to speak on behalf of the company during a crisis. This helps maintain a unified voice and message.

Factual Updates : Provide regular, factual updates to keep stakeholders informed. Avoid speculation and commit to transparency.

Decision-Making Protocols : Implement decision-making protocols that are clear and allow for swift action. This includes having a chain of command and predefined criteria for making critical decisions.

Training and Simulations : Regularly train your crisis management team and conduct simulations to prepare for potential scenarios. This ensures that when a crisis does occur, your team is ready to act effectively.

By integrating these best practices into your BCP plan, you can maintain control during a crisis, make informed decisions, and communicate effectively with all parties involved. Remember, the goal is to protect your company’s operations, reputation, and stakeholder relationships during unexpected events.

Utilizing Business Continuity Plan Templates and Tools

When it comes to developing a robust business continuity plan (BCP), leveraging templates can offer a significant head start. These templates serve as a foundational framework that can be customized to align with the specific requirements of your business. Here’s why using BCP templates is advantageous:

Efficiency in Development : BCP templates provide a structured approach, ensuring that all critical elements are considered without starting from scratch. This saves valuable time and resources.

Consistency Across the Organization : Templates help maintain a uniform response strategy, which is crucial for coherent and coordinated action during a crisis.

Ease of Customization : While templates offer a general outline, they are designed to be adaptable. This means you can tailor them to reflect your business’s unique operational processes, risk profile, and recovery objectives.

Incorporating features like crisis response directions into your BCP template is essential. With Creately you can,

• Visualize these procedures on an infinite canvas, ensuring clarity and accessibility for all team members.
• Easily modify the plan as your business evolves, with the drag-and-drop functionality, making regular testing and adjustment a seamless process.
• Create a central repository of information by having docs, links and attachments in the notes panel of any shape in your diagram.

Key Insights for Developing and Maintaining an Effective Business Continuity Plan

A robust business continuity plan (BCP) is not a ‘set it and forget it’ document; it requires ongoing attention and refinement. Here’s why regular testing, updates, and staff training are non-negotiables in business continuity:

Financial Protection : By regularly testing your BCP, you can identify and rectify gaps that could otherwise lead to significant financial losses during a crisis. It’s not just about having a plan, but ensuring it works effectively when you need it most.

Reputational Safeguarding : Your company’s reputation is on the line when disaster strikes. A well-rehearsed BCP means your team can respond swiftly and competently, preserving stakeholder trust and customer loyalty.

Customization for Evolving Threats : The threat landscape is constantly changing. Regular BCP reviews allow you to tailor your plan to new types of risks, ensuring your business remains resilient against the unforeseen.

Empowered Employees : Training staff on the BCP turns theory into practice. When every team member knows their role in a crisis, response times improve, and confusion is minimized.

Remember, a BCP is a living document. It thrives on the feedback loop created by regular drills and updates, ensuring that when a crisis does occur, your business is prepared not just to survive, but to continue operations with minimal disruption.

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The Bottom Line

What is a business continuity plan (bcp), and how does it work.

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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.

Key Takeaways

• 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 information technology 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 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.  

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Published: 21 December 2023 Contributors: Mesh Flinders, Ian Smalley

Business continuity disaster recovery (BCDR) refers to a process that helps organizations return to normal business operations if a disaster happens. While business continuity and  disaster recovery  are closely related, they describe two subtly different approaches to crisis management that businesses can take.

As data loss prevention and downtime become more expensive, many organizations are upping their investment in emergency management. In 2023, companies worldwide were set to spend USD 219 billion on cybersecurity, a 12% increase from the previous year  according to a recent report by the International Data Corporation  (link resides outside ibm.com).

What is a disaster recovery plan?

A  disaster recovery plan (DRP)  is a contingency plan for how an enterprise will recover from an unexpected event. DRPs help businesses manage different disaster scenarios, such as massive outages, natural disasters,  ransomware  and  malware  attacks, and many others.

What is a business continuity plan?

Like DRPs, business continuity plans (BCPs) play a critical role in disaster recovery and help organizations return to normal business functions when a disaster happens. Where a DRP focuses specifically on IT systems, business continuity management focuses more broadly on various aspects of preparedness.

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Most organizations divide BCDR planning into two separate processes: business continuity and disaster recovery. This approach is effective because while the two processes share many steps, there are also key differences in how organizations build, implement and test the plans.

The main difference is that BCPs are proactive, aiming to maintain operations before, during and right after a disaster. On the other hand, DRPs are reactive, focusing on how to respond and recover from an incident. This distinction should guide the creation of your BCDR strategy, with BCPs focusing on critical processes and roles, and DRPs on recovery actions post-incident. 

Both processes depend heavily on two critical components: recovery time objective and recovery point objective.

Recovery time objective (RTO)

RTO refers to the amount of time it takes to restore business processes after an unplanned incident. Establishing a reasonable RTO is one of the first things businesses need do when they’re creating their DRP.

Recovery point objective (RPO)

Your business’ RPO is the amount of data it can afford to lose in a disaster and still recover. Since data protection is a core capability of many modern enterprises, some constantly copy data to a remote  data center  to ensure continuity in case of a massive breach. Others set an RPO of a few minutes—or even hours—for them to recover business data from a backup system, so they know they are able to recover from whatever they've lost during that time.

1. Conduct business impact analysis

To build an effective BCP, you first need to understand the various risks your organization faces. Business impact analysis (BIA) is vital in risk management and business resilience. BIA is the process of identifying and evaluating the potential impact of a disaster on normal operations. Strong BIA includes an overview of all potential existing threats and vulnerabilities—internal and external—and detailed plans for mitigation. The BIA must also identify the likelihood of an event occurring so the organization can prioritize accordingly.

2. Design responses

When your BIA is complete, the next step in building your BCP is planning effective responses to each of the threats you’ve identified. Different threats naturally require different disaster recovery strategies, so each of your responses should have a detailed plan for how the organization will spot a specific threat and address it.

3. Identify key roles and responsibilities

This step dictates how key members of your team responds when facing a crisis or disruptive event. It documents expectations for each team member and also the resources required for them to fulfill their roles. This part of the process is good to consider how individuals communicate when an incident occurs. Some threats shut down key networks—such as cellular or internet connectivity—so it’s important to have reliable fallback methods of communication.

4. Test and update your plan

To be actionable, you need to constantly practice and refine your BCDR plan. Constant testing and training of employees lead to a seamless deployment when an actual disaster strikes. Rehearse realistic scenarios like cyberattacks, fires, floods, human error, massive outages and other relevant threats so team members can build confidence in their roles and responsibilities.

Like BCPs, DRPs require BIA—the outlining of roles and responsibilities and constant testing and refinement. But because DRPs are more reactive in nature, there is more of a focus on risk analysis and  data backup and recovery . Steps 2 and 3 of DRP development, analyzing risks and creating an asset inventory are not part of the BCP development process at all.

Here's a widely used five-step process for creating a DRP:

1. Conduct business impact analysis

Like in your BCP process, start by assessing each threat your company might face and what its ramifications might be. Consider how potential threats might impact daily operations, regular communication channels and worker safety. Other considerations for a strong BIA include loss of revenue, cost of downtime, cost of reputational repair (public relations), loss of customers and investors (short and long term) and any incurred penalties from compliance violations.

2. Analyze risks

DRPs typically require more careful risk assessment than BCPs since their role is to focus on recovery efforts from a potential disaster. During the risk analysis portion of planning, consider a risk’s likelihood and potential impact on your business.

3. Create an asset inventory

To create an effective DRP, you must know exactly what your enterprise owns, its purpose or function and its condition. Doing regular asset inventory helps identify hardware, software, IT infrastructure and anything else your organization might own that is crucial to your business operations. When you’ve identified your assets, you can group them into three categories: critical, important and unimportant.

• Critical:  Only label assets as critical if your enterprise requires them for normal business operations.
• Important:  Give this label to assets that you use at least once a day and that would have an impact on business operations (but not shut them down entirely) if they are disrupted.
• Unimportant:  These are assets your business uses infrequently that are not essential for normal business operations.

4. Establish roles and responsibilities

Just like in your BCP development, you need to clearly outline responsibilities and ensure that team members have what they need to perform their required duties. Without this crucial step, no one knows how to act during a disaster. Here are some roles and responsibilities to consider when building your DRP:

• Incident reporter:  Someone who maintains contact information for relevant parties and communicates with business leaders and stakeholders when disruptive events occur.
• DRP supervisor:  The DRP supervisor ensures that team members perform their assigned tasks during an incident. 
• Asset manager:  Someone whose job it is to secure and protect critical assets when a disaster strikes. 
• Third-party liaison:  The person who coordinates with any third-party vendors or service providers you’ve hired as part of your DRP and updates stakeholders accordingly on how the DRP is going.

5. Test and refine

Like your BCP, your DRP requires constant practice and refinement to be effective. Practice it regularly and update it according to any meaningful changes that are necessary. For example, if your company acquires a new asset after you've formed your DRP, you’ll need to incorporate it into your plan to ensure it's protected going forward.

In terms of BCDR planning, every business is going to have its own unique set of needs. Here are a few examples of plans that are effective for companies of differing sizes and industries:

Crisis management plan

A crisis management plan, also known as an incident management plan, is a detailed plan for managing a specific incident. It provides detailed instructions on how your organization responds to a specific crisis, such as a power outage, cyberattack or natural disaster.

Communications plan

A communications plan outlines how your organization handles public relations (PR) in the event of a disaster. Business leaders typically coordinate with communications specialists to formulate communications plans that complement any crisis management activities needed to keep business operations going during an unplanned incident.

Data center recovery plan

A data center recovery plan focuses on the security of a data center facility and its ability to get back up and running after an unplanned incident. Some common threats to data storage include overstretched personnel that can result in human error, cyberattacks, power outages and difficulty following compliance requirements. 

Network recovery plan

Network recovery plans help organizations recover from an interruption of network services, including internet access, cellular data, local area networks and wide area networks. Due to the critical role networked services play in business operations, network recovery plans must clearly outline the steps, roles and responsibilities needed to quickly and effectively restore services after a network compromise.

Virtualized recovery plan

A virtualized recovery plan relies on virtual machine (VM) instances that can be ready to operate within a couple of minutes of an interruption. Virtual machines are representations, or emulations, of physical computers that provide critical application recovery through high availability, or the ability of a system to operate continuously without failing.

BCDR planning helps organizations better understand the threats they face and better prepare to face them. Enterprises that don’t undertake BCDR planning face various risks, including data loss, downtime, financial penalties and reputational damage. Effective BCDR planning helps ensure business continuity and the prompt restoration of services after a business disruption. Here are some of the benefits companies with strong BCDR planning enjoy:

When an unplanned incident disrupts business as usual, it can cost hundreds of millions of dollars. Additionally, high-profile cyberattacks frequently attract unwanted attention in the press and can result in loss of confidence in both customers and investors. BCDR plans increase an organization’s ability get back up and running swiftly and smoothly after an unplanned incident.

According to  IBM’s recent Cost of Data Breach Report , the average cost of a data breach in 2023 was USD 4.45 million, a 15% increase over the previous three years. Enterprises with strong BCDR can reduce those costs by helping maintain business continuity throughout an incident and speeding recovery afterward. Another opportunity for cost-savings with strong BCDR is in cyber insurance. Many insurers won’t insure organizations that haven't established a strong BCDR plan.

Data breaches incur hefty fines when private customer information is compromised. Businesses that operate in heavily regulated sectors like healthcare and personal finance face especially costly penalties. Since these penalties are often tied to the duration and severity of a breach, maintaining business continuity and shortening response and recovery lifecycles is critical to keeping financial penalties low.

Even a minor outage can put you at a competitive disadvantage. Protect your data with a cloud disaster recovery plan. 

Employ a highly durable, scalable and security-rich destination for backing up your data.

Expand capacity and consolidate data center infrastructure onto an automated and centrally managed software-defined data center with IBM Cloud for VMware Solutions.

Many factors come into play when deciding whether to invest in and manage your on-premises disaster recovery (DR) solutions or use disaster recovery as a service (DRaaS) providers.

Backup and restore refers to technologies and practices for making periodic copies of data and applications to a separate, secondary device and then using those copies to recover the data and applications.

There are critical similarities and differences between disaster recovery and backup. These solutions can both help you solve your business' most important problems.

IBM has plans and processes in place globally that help sustain its business by assessing potential disasters. This paper provides an overview of the business continuity measures used by IBM to help prevent or reduce the impact of potential threats.

Zerto helps clients access robust disaster recovery and data protection capabilities while using the agility and flexibility of IBM Cloud for VMware solutions shared in a single-click deployment.

IBM's business continuity and resiliency engagement is designed to help you enable resumption of your business operations quickly and maintain the quality of your existing services in the event of an outage.

IBM Cloud Backup is a full-featured, agent-based backup and recovery system managed through a web interface. Back up data between IBM Cloud servers in one or more IBM Cloud global data centers.

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Business Continuity Vs Disaster Recovery

There’s lots of talk about business continuity vs disaster recovery plans, but what does it all mean?

If this year has tested your business to its limits, now that you have a little more breathing space, if you haven’t already got one, you may want to introduce a business continuity plan. But where do you even start when there’s are plenty of different plans or strategies that all sound rather similar?  Most importantly, what do we mean when we talk about business continuity plan Vs disaster recovery plan?

It can be difficult to understand the difference between business continuity and disaster recovery.

In this blog, we explain the differences, which will help you decide what you might already have in place and where you need to focus your attention.

What do we mean by Business Continuity Disaster Recovery?

If you want to understand business continuity Vs disaster recovery in more detail, you need to first understand what business continuity means. In simple terms, a business continuity plan ensures that in the event of a disaster happening or your workplace becomes inaccessible, your business can continue to operate with as little interruption as possible.

A disaster could be a natural disaster, or it could be related to theft, or even terrorism. However, it could also be (and is more likely to be) a cyber attack, human error, adverse publicity, or deliberate damage caused by a disgruntled employee – sadly, this does happen!

As we’ve seen for the best part of this year, a business continuity disaster recovery plan may involve being able to quickly mobilise employees to work from home.

What Must a Business Continuity Plan Include?

In IT disaster recovery terms, a business continuity plan must consider all possible eventualities that pose a risk to your business. Nobody saw the pandemic happening, but those who already had a business continuity plan that considered a national emergency and the need to pivot to working from home, found 2020 a lot easier.

Large global incidents aside though, you need to ask yourself a series of questions – something we always do when we put together a disaster recovery business continuity plan for our clients. The list of scenarios could be anything from a flood, through to your reliance on third-party suppliers and cyber attacks.

It’s important to create a business continuity plan that is bespoke to your business.

Here are some of the things your business continuity and disaster recovery strategy should plan for:

• Temporary relocation of premises
• Data backups
• Remote working from home or another location
• Reallocation of roles to staff
• Using contractors and suppliers as a fallback
• Ability to protect and restore personal data in line with GDPR

What is the difference between business continuity and disaster recovery?

Having an IT Disaster Recovery Plan should be business-critical, yet only 30% of companies have one.

IT Disaster recovery is the term used to describe the returning of business operations to normal after a disaster. If daily business operations have been interrupted, your disaster recovery plan will transition your continuity measures back to normal processes.

There’s a very real threat facing business today though; assumptions are being made that a backup strategy is the same as a Disaster Recovery Plan. Sadly, it’s a contributing factor to 7 out of 10 small businesses folding within a year of a major data breach.

Do you know exactly how long it would take your existing backup solution to restore all your data? Considering over 33% of lost data is financial or customer information. How long could your business survive? These are answers you would confidently know if you had a Disaster Recovery Plan (DRP).

When thinking about business continuity vs disaster recovery, it’s much easier to consider the risks if you think of backup as a copy of your data and the Disaster Recovery Plan (or strategy) as the insurance that enables its recovery.

Things you should consider when creating a Disaster Recovery Strategy:

• Who needs to be involved in the IT disaster recovery planning?
• How will you recover from data loss or infrastructure failure?
• Who will be responsible for various recovery tasks?
• How frequently should we stress-test our DRP?
• What are the benefits of outsourcing the process to a company like Agile?

As we discussed in our previous blog on cybersecurity, you’ll also want to be certain that your data is being backed up. Your data might be located on a server but exactly where is it and how is it protected?

You might also have heard of the term DRaaS. This stands for Disaster Recovery as a Service. Essentially, it’s a category of Cloud computing that protects applications and data from a disaster or service disruption at one location by enabling a full recovery in the cloud. This means that your business can operate virtually, in a secure cloud location, whilst your primary systems are being restored.

At Agile, we have our own DRaaS replication service . This involves replicating either your physical or virtual servers into our local data centre in Colchester, Essex. It’s a fraction of the cost of traditional IT disaster recovery solutions and DR systems.

What is Disaster Recovery Contingency Planning?

This is a really important point when exploring business Continuity Vs Disaster Recovery. A disaster reovery contingency plan prepares a business for any potential events that could significantly impact day-to-day operations. This could be anything from the loss of a critical member of staff through to physical and environmental disasters.

Within your disaster recovery contingency plan, you’ll need to consider which aspects of your operations are business-critical. This could be a ransomware attack, a core supplier or contractor entering insolvency, or dare we even say it, another SARS virus!

Plan for a broad range of possibilities and what will action your contingency measures.

So, What’s the Difference between Business Continuity and Disaster Recovery? 

Whilst they are related, it’s easiest to think of them in the following way:

• A contingency plan is advanced planning to prepare your business for future events
• A business continuity plan is a temporary solution to keep you up and running in the event of an incident
• A disaster recovery strategy returns operations back to normal after a disaster has happened

In reality, a business needs a plan that encompasses all three. Here at Agile Technical Solutions, we can help you plan ahead.

Our business continuity and disaster recovery plans have seen our clients quickly pivot to home working this year. Moreover, in an environment where cyber attacks are on the increase, we put in place all the necessary protection and stress-test your systems with regular DR simulations.

Please don’t hesitate to get in touch and find out how we can help you. Our initial consultation is always a complimentary one where we get to know you are your business.

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A Contingency Planning Guide: How to Future‑proof Your Business

Learn about business contingency plans and why it makes sense to create one now.

We have probably all been in situations where things have not gone as expected. Although no one wants carefully laid plans to go awry, having a Plan B ensures that you’ll be able to weather most unforeseen events. Being prepared for alternative action is especially crucial in a business context where the unexpected can happen at any time.

What is contingency planning?

A contingency plan is a clearly defined course of action that can help any organization deal with potential business risks, ensure business continuity, and then resume normal business operations as quickly as possible.

Why is it important to create contingency plans?

An unfavorable event is generally unlikely to take place. However, as a business owner, having a contingency plan for different scenarios can give you peace of mind that an emergency response is set in place if things do go wrong. With this kind of backup plan, disaster recovery will be a much smoother process, and normal operations can quickly resume.

For example, no one can accurately predict when natural disasters will strike or when global events like the Coronavirus pandemic are going to hit. In the case of the latter, nearly every business faced hardship, regardless of its size or industry, but companies that had contingency plans were able to get back on their feet sooner.

Other than providing guidance during external unexpected events, a contingency plan should also extend to possible internal events, such as data breaches, staffing shortages, software downtime, or declining business relationships.

A contingency plan doesn’t just have to cover a negative event. Ideally, you should also have an action plan in place for growth or improvement situations—for example, if there is a sudden surge in customer requests or you identify a special market opportunity.

What differentiates a contingency plan from other types of risk planning?

Business continuity plan.

A business continuity plan is a temporary solution that ensures your business is able to continue functioning even after operations have been disrupted. For example, if you are suddenly unable to access your office space, a business continuity plan would be to invest in software that would allow your employees to work from home until new premises can be secured.

Alternatively, a contingency plan triggers a course of action in response to a specific incident. For example, a contingency plan for the loss of a huge client would be different from one dealing with an information systems crash.

Disaster recovery plan

While a contingency plan is a proactive strategy, a disaster recovery plan is a reactive one and should be part of any contingency policy to return your company operations back to normal. It can include recovery strategies, such as continued data access and IT infrastructure, so your company operates near the level it did before the disaster took place.

Disaster recovery and business continuity planning are both narrower in scope than a contingency plan. It deals mainly with operational matters in your organization so that you can recover from a disaster as quickly as possible.

Crisis management plan

Like disaster recovery, a crisis management plan is more focused on real-time response following a crisis, compared to the preventive planning needed for a contingency plan. A quick note on how to differentiate disasters from crises—a disaster comes about suddenly, whereas a crisis develops over time (be it quickly or slowly).

It is impossible to be prepared for every eventuality despite your best attempts to make the most thorough recovery strategies. The events that occur might not fit neatly into your contingency plan. In these situations, the only way out is to swiftly modify the contingency plan.

When companies need to think on their feet and adapt to unexpected scenarios, this is where crisis management—the overarching management of emergencies—comes into play.

Risk management plan

Risks are always present in the business world. A risk management plan is similar to a contingency plan because it is also proactive in nature. However, with risk management, you have an action plan to prevent potential crises from taking place, while also reducing the impact of these crises should they happen.

A contingency plan only kicks in either once a certain negative event becomes inevitable or there are enough warning signs to trigger a contingency response.

Pitfalls to avoid when creating your business contingency plan

Not budgeting for your business contingency plan.

A contingency plan has to include a contingency fund, which sets aside a certain amount of resources (e.g., money, people, time) to cover unanticipated costs. It’s a good idea to decide this amount with your team or other stakeholders beforehand to prevent future disputes.

Resist the temptation to cut these funds even in times of a budget crunch. If something does go wrong, you will need to explain to management what happened to your contingency plan.

Not having enough support

Although contingency planning sounds like a good idea, not everyone will agree that it’s necessary. Before you start doing anything, find out how open-minded the stakeholders at your company are. If you cannot identify enough executives who think it’s important, don’t waste your time and effort to create one.

Not updating contingency plans

Contingency plans need to be updated regularly to account for new risks, changes in government policies, and shake-ups in organizational structure. In short, they need to remain current and evergreen. Schedule reminders a couple of times each year to review the existing plan and make changes if necessary.

Your contingency planning process in 10 steps

Step 1: create a contingency planning policy statement.

A contingency plan policy statement is a formal document that outlines the contingency objectives for your organization, such as getting back to normal operations by a certain time. A policy statement also expresses the authority and gives the guidance necessary for stakeholders to create a contingency plan.

Essentially, this should answer the questions “what is contingency planning?” “how should I go about doing this?” and “what can stakeholders expect from a contingency plan?”

Step 2: Carry out a business impact analysis

A business impact analysis (BIA) is used to determine the potential impact, both operational and financial, of a disruptive event in your organization. By doing so, you will be able to recognize the systems, components, and processes that are vital to your business functions, and therefore identify your recovery priorities in the event of an emergency.

Step 3: Conduct a full risk assessment

Every organization has its unique set of potential risks, which can be identified with a risk assessment. Having implemented a BIA, you will now know what your business-critical operations are. To get even more ideas, schedule a brainstorming session with your executive team and/or other stakeholders.

After this, you then need to identify the threats that could harm each of these operations—for example, a technical glitch or a change in business regulations. Once all this data has been collected, put it in a risk register—a risk chart that enables you to track your risks and any information you need to know about them.

Step 4: Classify the key risks to your business

Once you have all your potential risks, it’s time to evaluate how they might impact your organization. Ask yourself the following key questions:

• What is the likelihood that these risks will happen?
• How would these risks impact your business?
• What is the level of severity for each risk?

One way to rank risks is to use a qualitative risk assessment , which orders each risk according to its probability of taking place as well as its potential impact. Another common method is the quantitative risk assessment , which estimates how much each risk might cost your business and ranks the results from most to least costly.

Step 5: Draft contingency plans for prioritized risks

You’ll now start to create a contingency plan for the highest priority risks to your organization, namely those that are most likely to occur and cause the most damage. Outline the actual actions needed to confront a disaster and include preventive controls that can reduce the effects of disruptions.

An example of a modern, detrimental event for most companies would be an information systems breach. Preventive controls for this situation would be to invest in a good-quality antivirus software, make sure your software is regularly updated, create strong passwords, and have files backed up on-premises.

As for the actual plan, these contingency strategies and procedures are usually tailored to the system’s security impact level and recovery requirements.

Step 6: Get buy in from stakeholders

After creating a first draft of your contingency plan, it’s time to get stakeholder approval. Given that contingency plans usually involve employees and management across your company, it will be extremely difficult to implement them without adequate support. Getting approval well in advance also means that plans can be put into action right after an incident occurs.

Step 7: Distribute your contingency plans and make them easily accessible for your entire organization

Contingency plans are usually department-wide or company-wide. By putting them in a shared public folder with a clear document name, you are ensuring that everyone will have easy access to them in case of an emergency.

Step 8: Train your employees

Having laid all the groundwork, you can move on to the execution stage. It’s essential that the parties who have roles in your contingency plan know what their responsibilities are in each risk scenario. Once everyone has been appropriately trained, each of them will be prepared to act quickly in the event of an emergency.

Training should also be given to new employees so they know what contingency planning is, what it entails, and what they might have to prepare to do in the future.

Step 9: Put your contingency plans to the test

In the event of a real disaster, would your contingency plans be effective? There is only one way to find out—and that is through plan testing. Set aside time to run through the procedures for each contingency plan as if each emergency scenario were really taking place.

Not only will this validate the recovery capabilities of each plan, but it will also show if there are any deficiencies or gaps, which can then be improved upon.

Step 10: Continually review and revise your contingency plans

Smart managers know that it is not enough to just create a contingency plan. Plan maintenance is more difficult, and it takes more effort—but that’s what makes it all the more critical. Risk management is an ongoing process, and you need to keep your plan up-to-date when risks or business requirements change.

Ensure your business continuity first, thank us later

Comprehensive contingency planning will make sure that you are prepared to deal with all the risks that come with running a business. Be it natural disasters, workplace accidents, financial instability, malware—these are only the tip of the iceberg of things that can go wrong. But, with a tested contingency plan, you can effectively prepare for whatever may come your way.