Why develop a Business Continuity Program?

A Business Continuity Program is the complete action plan to help prevent disasters and set up a plan to recover from an unexpected event that interrupts your business. A large percentage of businesses do not survive a disaster and end up out of business. Stay in business for the long term – be ready for disaster and unexpected events with a complete Business Continuity Plan.

A Business Continuity Program is sometimes viewed as an expensive program for many companies. You hear comments like:

“We don’t need it; we have never had a problem.”
“We have insurance.”
“Our people are really good. If something happens they will get us back operational in no time”

Believing these statements could prevent your company from surviving an emergency or disaster event.

If your company has never experienced a problem, consider yourself very lucky. Remember a problem does not have to happen at your facility. What happens if your major supplier or customer has a problem? What if another company in your building or campus has a problem? Any of these problems could impact your business.

You have insurance, but many sources of disasters are not covered by business insurance. Business interruption insurance covers the lost profits, buildings and operational costs. But if you have no business to operate, or no building to work out of, then insurance will not really help.

Sure your people are good, but even the best people will have trouble recovering your business if they do not know where they are going to recover the business and what they need to recover. You could buy everything after a disaster and locate a new building and build out the infrastructure and contact your clients and suppliers, etc. You also have to consider that your best people may not be available to recover your business. They may be hurt, on vacation, stressed due to the disaster or they may have died in the disaster.

By developing a Business Continuity Program for your company and making business continuity part of your corporate culture, you will be well on your way to becoming a company that will be able to survive an emergency or disaster event.

Excerpted from “Business Continuity Program Development – A Basic Guide” developed by Business Continuity & Recovery Consulting

Business Continuity Planning in this Economic Cycle

Is business continuity planning something that you need to do during an economic downturn? Or is this a "nice to have" that can be put on the back-burner and looked at when the economy picks-up?

I am going to argue that now is the time you should be developing and implementing a full business continuity plan.

Many companies cut back on their marketing and spending during tough economic times. The same is true for those projects that they know they need to complete but they have always had other projects with a higher priority to take care of first. Business Continuity Planning is one of those projects. As many marketing people will tell you, during tough economic times, you should increase your marketing, not cut back. People still need to know you are in business. Companies still need to buy your services; they need to find you.

So why should you consider developing a Business Continuity Plan now?

I suggest you take a look at your supply chain. Do you have one or two main suppliers of your raw material? Do you have one or two customers that provide over 50% of your revenues? What would happen if any one of these companies went out of business? Could your business survive?

A Business Continuity Plan is not a program that can or should be deferred until the "time is right". The only right time is now to begin developing and implementing a plan.

Disasters happen at the worse possible time. They do not wait until you or your executives say that they can respond to the emergency or disaster event.

My advice is to start your planning now. When everyone else is experiencing problems, you will be able to know that you have thought through your business' primary activities and will know how to respond effectively and efficiently to any emergency event.

Could your business survive a supply chain interruption?

Businesses of all sizes have a supply chain that they rely on for the successful continuation of their business. For some companies, the supply chain keeps their production line operating by providing just in time delivery of component parts, pick-up of finished parts and off-site storage or parts and materials. For others, their supply chain may not be as obvious to the business. For companies that rely on partners or other businesses to provide information or deliverables that the company uses to produce the final design or report, these providers are part of the company’s supply chain.

Does your company outsource the provisioning of services, such as finance, Human Resources or auditing? These could also be considered part of your supply chain. Some of the companies providing these services may be smaller and less resilient to a disruption to their business.

In order to manage the risks to your company from your supply chain, you need to understand your organization’s activities and processes.

· The critical functions and activities should be identified.

· The impact to the company that a loss of a supplier may have.

· The risks that could impact the supplier.

Once all of this information has been gathered, then you can start to mitigate the risks to your business that could occur due to a supply chain problem.

The loss of a supplier is a major risk today as more business functions are outsourced. It is necessary to validate the supplier’s recovery capability before committing all of your activities to any one supplier.

Preparing for disaster – could Canadian businesses be legislated to develop Business Continuity Plans?

In today’s corporate world with its associated risks and potential problems to a businesses survival, there is very little legislation that relates back to companies having a business continuity program in place.

In other countries around the world, legislators are moving to impose rules and regulations that would mean that companies would have to develop and implement business continuity programs. These future rules and regulations would be based on existing standards such as the National Fire Protection Association (NFPA) 1600 and others.

The NFPA 1600 standards define business continuity as “an ongoing process supported by senior management and funded to ensure that the necessary steps are taken to identify the impact of potential losses, maintain viable recovery strategies and recovery plans, and ensure continuity of services through personnel training, plan testing and maintenance.”

The United States House of Representatives presented a bill in August 2007 that was signed into law that encourages the use of business continuity and disaster recovery standards for the private sector. This law specifically cites the NFPA 1600 code.

Will Canadian legislators follow suite? If they don’t will any Canadian company doing business with the US be required to show that they have a business continuity plan in place? I don’t know, but I do believe that if the US and other countries governments are moving in this direction, it may be of benefit for Canadian companies to begin planning and developing their business continuity plans now to stay ahead of the curve.

An article at http://www.forbes.com/opinions/2008/01/16/disaster-preparedness-companies-oped-cx_slw_0117disaster.html talks about this in a bit more detail.