Business Continuity Planning and Tools
Among the most buzzing word during COVID-19 is Business Continuity Plan
Business Continuity Plan (BCP): A detailed plan prepared to help companies ensure undisrupted business activity at all times. The plan entails planning, documentation, checklists, training, drills, and tools.
What can disrupt business?
- Force Majure/Natural (Pandemic, Eatherquake, etc.)
- Accidents (Gas Lead, Power failure, etc.)
- Wilful Acts (Terrorism, Cyberattack, etc.)
When do companies plan?
The ideal time would be day 1 of the company. But that’s ideal. Usually, following are the triggers for companies to start the planning,
- Management foresees hypergrowth
- Key stakeholders require assurance of stability
- There is evidence of weakness in the current business longevity plan
- New business direction requires company to rethink everything
- Business disruption of competitor/others in the market
- Regulatory reasons
What are the benefits of the plan?
- Increased control and confidence in the company’s stability
- Reduced losses during disruption
- Improved brand/reputation
- Reduced insurance premiums because of strong risk mitigation practices
What shall be covered in the plan?
Ideally everything. It is a plan to run the company tomorrow as it is running today, irrespective of internal or external changes.
In reality, pragmatically, companies prioritize segments for minimal damage instead of zero damage, in order to balance out the cost of executing a plan. Stakeholders agree on segments of business that can absorb the delay/don’t affect the functioning of business severely.
For example, customer delivery/service upkeep might be the most important function to safeguard. Whereas, for a cash-rich company, Cash Collection delay of 15 days won’t impact the business.
Following is the breakdown of various tangibles to be protected,
- Assets & Resources ( Infrastructure, Tools, Employees, etc.)
- Information (Data, IP, Functional Knowledge, etc.)
- Finances (Cashflow, Reserves, etc.)
- Business Functions (Supply Chain, Customer Satisfaction, Vendors)
- Business Relations (Customers, Vendors, Employees)
The most important ones are explained below,
IT Security and Recovery
In today’s world, data and connectivity are of foremost importance. There are services and products available in the market to safeguard the company’s data and systems. The largest share of the BCP budget goes behind Security and Recovery.
Along with data backup and disaster recovery solutions, companies invest heavily in protecting IT attacks and thefts.
Finance Management
It involves cash reserve management, cash collection/disbursals, and few other things. Reserves are usually invested in the market (Stock, Bonds, Govt. Securities, Real estate, etc.). Companies need to maintain a certain level of liquidity to address the cash crunch in the disruption. Also, collection and disbursals related risks are to be mitigated.
Supply chain
Procurement of materials to delivery of final products need supply chain. Visibility of and alternative to each player in the supply chain is required to stay unaffected during disruptions. The medium of transport and access to alternatives is to be documented.
The planning Exercise
The success of the planning and execution requires,
- Involvement and commitment of top management.
- Involvement of senior stakeholders from all teams.
- Documentation and access to documents/tools during a disruption.
Below are the general steps involved in the planning exercise,
Step 1: Risk Assessment & Business Impact Analysis (BIA)
Step 2: Business Continuity Plan Development
Step 3: Plan Testing & Maintenance
Business Continuity Planning Tools and Software
There are three types of IT products involved in this activity,
- Business Continuity Management (BCM) Tools
These tools help companies manage the Business Continuity Plan. They act as a project management tool. They give a singular view of all the BCP activities in the organization.
2. IT Security and Recovery
As mentioned earlier, IT Security and Recovery takes the largest share of the budget. This in itself is a $400 billion market.
3. Function specific products
These are function (Operation, Finance, HR) specific tools that help in BCP. This is a niche play. For some functions, generic project management and activity tracking tools might serve the purpose.
Business Continuity Management Tools
IBM, PWC, KPMG, and a few others are leaders in BCM consulting and custom tool developments. While Continuitylogic, Metricstream, Quantivate, Bwise, and others have off the shelf BCM tools. These tools have pre-set BCP templates to kickstart the customer’s planning journey.
The tools help companies with
- Centralized view dashboards of BCM activities across departments
- Maintaining a business process repository
- Recovery plan management (Edit, update, etc.)
- Communication of responsibilities and deliverable
IT Security and Recovery Tools
There are innumerable tools catering to this segment. Each sub-segment has 1000s of companies. The usual sub-segments are
IT Security
- Cybersecurity
- Incident Management
- Network Management
- Rights and Access Management
Recovery
- Data Recovery
- Connection Recovery
- Post Recovery Restoration (Reconfiguring all systems with recovered data/software)
Function specific products
These tools help companies with specialized control and recovery management of niche activities. For example,
- Compliance Management
- Audit Management
- Vendor and Supplier Risk Management
- Operational Risk Management
- Company Policy Management
Sources:
PWC
KPMG
AIG
AT&T
