Imagine that you had arrived at your place of work this morning to find that it had burned to the ground. The Buildings Insurance would cover the fire damage to the building itself, but what about the effect on your business? It may take many months or even years to reinstate your premises. How could you continue to trade or provide your service when a disruption such as this occurs? Where do you start?
Business Continuity Management is about being aware of the risks your business faces, how to minimise these risks, and how to deal with the aftermath should any of them arise. Of course, fire may be a risk to every business, but there are many others to consider, such as the loss of key personnel or the threat of malicious damage to plant or equipment. Imagine if your employees won the lottery in a Company syndicate. Could you rely on them to be at work on Monday morning, having won £1,000,000 each? The list of different risks is endless.
The first step of the process of Business Continuity Management is that of risk management. We all know that prevention is better than cure, and the implementation of simple measures can avert a potential disaster.
Let’s use our example of fire. There are many ways to prevent or minimise its effect. An obvious example of this is the installation of smoke alarms and fire extinguishers. Take a moment to consider your current arrangements. How many smoke detectors do you have? Are they correctly placed? When were the alarms and extinguishers last tested? Larger premises may benefit from a sprinkler system.
Could you relocate following the total loss of your current premises? It is better to know who you should contact now, rather than to wait until the loss has occurred. Do you have contact points for emergency contractors such as glaziers and utility companies? Are these numbers easily accessible? How would you inform your customers/clients that you have been forced to move, and thereby preventing them from contacting a competitor when unable to get in touch with you?
The key word is Alternatives. For example, Where would you be able to relocate to? Are other contractors, which you rely on, available?
Consider the following ‘Business Impact Analysis’:
The organisation – The effect of interruption; is reputation an issue; possible target for pressure groups?
Premises – What alternatives are available; does location matter; how long to re-build; any planning problems?
Key personnel – Are they deputised or shadowed? Do they have unique knowledge or contacts? Can they be easily replaced?
Business Continuity Management:
Customer base – How fierce is competition; what is the level of customer loyalty; are there seasonal/periodic peaks?
Utilities – What is the business reliance on these; what is the reliability of supply; any fallback arrangements – eg stand-by generators?
Plant & equipment – Are there production ‘bottlenecks’; length of lead times; any history of breakdown; are strategic spares kept separately?
Stock and materials – What are the lowest quantities/highest demand levels; how long to replace; could there be supply directly to customers?
Technology dependency – is there adequate physical protection; how long for system replacement; what service level is provided?
Data – is there appropriate confidentiality, integrity and availability; are there adequate/ frequent off-site back-up arrangements?
Suppliers and sub-contractors – Are these key to operations; what is their resilience; do alternatives exist?
Insurance – To what extent can Insurance cater for interruptions, and which are pure business risks?
All of these points should be covered in a business continuity plan, which is individual to your business, whether you are a sole trader, a larger company, office or school.
The plan should be a pre-agreed strategy, compiled by senior management to include key actions, teams, contracted assistance, alternative premises, alternative suppliers, and standby facilities needed to put you back in business. A copy of this plan should be kept away from the business premises for obvious reasons.
We aim to be proactive in helping you to recognise and manage the risks your business faces every day.
Your business is individual and unique. A little preparation and forethought now could make the difference should disaster strike.