DYNAMIQ IN THE NEWS: PREPARING FOR THE UNPREDICTABLE
Why your business continuity plan will save you when disaster strikes
A business continuity plan assists organisations to respond effectively to unplanned interruptions, minimising the consequences and often allowing the business to continue, albeit in an altered state, until recovery can be achieved.
Managing Principal Dynamiq Strategy - Kel Donovan
Reinsurer Swiss Re, reports that natural and artificial disasters caused $136bn of insured losses in 2017. This was the third highest year on record, with the 2017 total more than double the 2016 figure.
Whilst sufficient insurance coverage is imperative for disaster recovery, insurance is not a business continuity strategy.
ASX Operating Rules specify that all listed organisations need to have adequate disaster recovery and business continuity arrangements in place. In addition, they must be tested annually.
Adequate arrangements, according to the ASX, include a business continuity plan which ensures operational recovery as soon as practicable with minimal damage post disruption. Having plans in place however, is only half the battle.
Organisations need to conduct training and simulation exercises to test the plans, ensure their crisis management teams understand the plans and are competent in implementing them during a crisis.
So how is a business continuity plan compiled?
In order to start planning, we review the risks, the likelihood of occurrence and the mitigation measures outlined in the organisation’s risk management plan. It may sound obvious, but most organisations miss the critical opportunity to integrate business continuity management within crisis management. As the crisis management team typically leads the organsiational response, they are also best placed to oversee the implementation of the business continuity plan.
The next critical step is to conduct a business impact analysis (BIA) to analyse the consequences of a disruption to your business. The business impact analysis forces you to think laterally about the broader consequences of a disruption event. Once you have identified the consequences, you can then assess the criticality of each business function and develop strategies for temporarily working around a disrupted function.
The completed BIA will then form the foundation of your business continuity plan (BCP). The BCP can then be developed by taking the work around strategies from the BIA and developing detailed plans for implementation.
Once the BCP has been drafted, it’s time to implement the plan through training and testing. If your crisis management team is responsible for implementing the plan, this training and testing can be integrated into the same training and testing performed for the crisis management program.
The benefits of having a well-rehearsed business continuity plan become particularly obvious when disruption events occur.
During the Brisbane floods of 2010-11, the floods were expected days in advance, yet few organisations anticipated the broad sweeping consequences. As switchboards and ground floor backup power supplies flooded, data room air-conditioning failed allowing data rooms to overheat resulting in whole-of-business IT system failures.
Workforces assigned to work from home were rendered ineffective as they could no longer access information and communicate. As the damage to infrastructure became clear, the race began to secure scarce resources and the specialists required to repair damage. Those businesses affected suffered prolonged recovery periods and significant financial loses.
With some basic business continuity planning, many of the affected businesses may have identified their vulnerabilities to flooding and taken measures to protect themselves. In both the short and long term, business continuity planning is a great investment for businesses of all sizes.
Kel Donovan recently hosted a webinar where he went into detail about the do’s and don’ts of business continuity planning.Back to all news