Why would you need a business continuity plan? There is a lot that could go wrong in the occurrence of a disastrous event. Every incidence unfolds in a unique and unexpected way capable of crippling the operations of an entire company. In most cases, you don’t even get to have some lead time, leave alone a heads up, in the face of disaster.
Having an effective business continuity plan is imperative to the survival of your company. However, in the real world, the occurrence of a disaster, either man-made or natural, accentuates the challenges of having textbook disaster recovery systems. Business continuity plans are necessary for all forms of enterprises.
What Is a Business Continuity Plan and Why Should You Have One?
A business continuity plan clearly outlines the instructions and procedures a company must strictly adhere to when disaster strikes. The plan allows the organization to maintain or quickly resume operations in the event of a major disruption. Say, an epidemic illness, a flood, a malicious online attack, or a fire. Therefore, the business continuity plan will include business partners, human resources, company assets and business processes, among other things.
The lack of a comprehensive business plan, in the worst case scenario, could mean a company going completely out of business after a catastrophic event. As such, the company will take longer than necessary to bounce back to regular activities. In any case, the company’s best shot at regaining previous success will come from having an effective business continuity plan.
Business Continuity Plan vs. Disaster Recovery Plan
Most people erroneously use the terms business continuity plan and disaster recovery plan interchangeably. While the former is associated with the recovery of the entire company after man-made or natural disasters, the former is only focussed on the restoration of IT operations and infrastructure ensuing a catastrophe. A disaster recovery plan is, however, a crucial part of a business continuity plan.
The Importance of Having a Business Continuity Plan
Money is lost when disruption of normal business activities occur. Profits are significantly reduced due to the arising extra expenses and lost revenues. Every company, whether it’s a small firm or a large enterprise, will strive to remain in business. Depending on the nature of the incident, the insurance company will not pay for some of these losses. Neither will it bring back clients who would have defected to the competitors. Business continuity planning will act in response and help the organization pull through if such disasters occur. It prepares the company for risks that are out of your control. It will also help you identify and prevent these risks where possible.
Creating a Comprehensive Business Continuity Plan
1. Risk Assessment
First and foremost, conduct a risk evaluation process to detect potential catastrophic events and their impact on the company’s operations. There are many catastrophic events to consider. Each one of them presents a plethora of unique scenarios depending on location, magnitude, and timing. Therefore, the first order of business in risk assessment should be injuries to people. Disasters that could lead to injuries to staff members should be highlighted. The appropriate measures should be put in place to minimize casualties.
Other physical assets such as finished goods, raw materials, utility systems, machinery, information technology, and buildings could all similarly be at risk. Situations that could lead to customers losing confidence in the company should be put into consideration. Furthermore, the environmental factors are also very important since they could have an impact on the stakeholder, the surrounding community, as well as your customers.
Above all, what you are looking for here is a weakness or a vulnerability that is likely to make any aspect of your company prone to damage in the face of a catastrophe. Some of these vulnerabilities will increase the extent of damage and takes the form of loss prevention programs, protection systems, security, process systems, and faults in the building’s structure.
2. Business Impact Analysis
Once you have completed the risk assessment, a Business Impact Analysis will be next to predict the consequences of the possible loss scenarios. Business Impact Analysis serves to identify critical or time-sensitive business operations and the procedures that back them up. The process will gather necessary information required in the development of recovery strategies. Considering as many scenarios as possible is important.
3. Incidence response plan
The disaster response plan outlines all the required information to respond to a crisis immediately. The sections of a response plan depend on the size of the company, but generally an incident response plan will include:
4. Contact lists
Accordingly, a list of parties the firm will need to get in touch with in case of a disaster and may include external contacts (customers, suppliers), emergency services, internal staff, and their families.
Details the forms, time, and methods of communication required to bring the business back to life and keep everybody safe.
6. Incident response team
Put together a team of employees to form a disaster response team. The size of the team will once again depend on the size of the firm.
7. Plan activation
Next, plan activation will give a clear outline of the circumstances under which the business continuity plan should be implemented.
8. Recovery Plan
The recovery plan details the procedure of getting the company up and running after the occurrence of an event that disrupts its operations. A good recovery plan will spell out a time frame within which the company should be back on its feet. The period you outline should be realistic and you should aim it at minimizing associated recovery costs.
9. Testing the Business Continuity Plan
Members representing each functional unit led by a recovery coordinator participate in the BCP tests. Consequently, the Common Business Continuity Plan includes simulations, structured walk-throughs, and table-top exercises. However, the frequency of BCP tests depends on the firm. Most organizations conduct BCP tests between twice and four times a year.
Developing a casual attitude towards the plan is a sure way to contribute towards the failure of an otherwise decent business. It is critical that each and every employee knows and understands the importance to the plan, from the top management to the janitor.
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