In case of a crisis, a business is left vulnerable, and often left exposed to disruptions to business. Depending on the crisis it can leave a company with significant loss. This loss is mainly financial but it can also disrupt a company’s reputation.
Reputation is vital to the success of a company; it can take years to build a reputation but minutes to lose!
In extreme cases a crisis can destroy the existence of a company.
The importance of business continuity planning is something that every company has been forced to deal with in recent years. The current economic climate has played a part in bringing business continuity planning to the fore front of Chief Executives minds.
Statistics believe that two out of five businesses go out of business within five years of a disaster/crisis. Business continuity plans are therefore critical to the transparent and continuous operation to all types of businesses.
As companies place more emphasis on information technology there is an increased importance to have a strategy in place, as companies become more and more reliant on technology.
Business continuity is defined as a plan a business sets in place in case of an emergency, outlining disaster recovery policies, guidelines and procedures for implementation to maintain and conduct business. The purpose of the plan is to have a back-up in place so that business is not affected and that employees and suppliers can still get paid and customers are none the wiser (hopefully) of any disaster and is “business as usual.” Companies recognise that certain aspects of business must still continue despite the crisis.
It is important to note that the plan is not there to recover from a crisis but the plan endeveors to ensure that critical operations are still in place.
It is a ‘roadmap’ for continuing operations under adverse conditions. There are a numbers of things that are out of a company’s control that can affect business; these include natural disasters like earthquakes, fire, theft, vandalism and pandemic illnesses. The nature of the cause is not so important but more the damage left to the business.
The plan covers the recovery of key functions that are different for each company. This covers IT, data and voice communications. It is essential that back up premises are available for employees to work.
Most companies realise that it is not sufficient to have a “one size fits all” plan to cover every disaster. It should be customised to specific risks and scenarios, to ensure all areas are covered.
Business continuity is not important to some businesses, with some believing that a disaster will not happen, but it does and if it does it can end a business if no preventions are put in place.
Even if a company does not create a thorough business continuity plan a company should at least have arrangements in plan to pay employees and suppliers.
Now more than ever it is critical for every business to maintain operational effectiveness and flexibility in any scenario. A business that is well planned is known to survive!
This is a guest post by Louise from Business Recovery who offer a range of business turnaround solutions.