In business, there are always risks that something could go wrong. A natural disaster could strike, a key employee could leave, or your computer system could crash – any of these things could cause severe disruption to your company.
That’s why it’s important to have a business continuity plan in place. Not only will it give you peace of mind knowing that your company can make it through difficult times, but it can also be useful for keeping things on track during a high-risk period.
But what is a business continuity plan? And how do you create one? We’ll discuss all this, as well as the benefits of having a continuity plan in place.
Definition of a Business Continuity Plan
A business continuity plan is a document that outlines how a business will continue to operate during and after an unexpected event. The goal of a continuity plan is to keep the company running, even if some aspects of the business are disrupted.
Continuity plans are important because they help businesses avoid or minimize downtime and financial losses. They also help to protect employees, customers, and other stakeholders.
Business Continuity Plans – Now and Then
It all started in the 1970s when businesses started to become more reliant on computer systems. At the time, there was a lot of uncertainty about how these systems would work and whether or not they would be reliable. As a result, companies began to develop contingency plans in cases of computer system failure.
These early continuity plans were mostly focused on technology, but over time, they have evolved to encompass all aspects of the business. Nowadays, business continuity planning, by definition, takes into account things like natural disasters, power outages, pandemics, or cyberattacks.
For example, according to the IDC research survey conducted in 2014, an infrastructure failure can cost USD $100,000 per hour. Since then, technology has developed exponentially, and the costs may be even higher now.
The risk of cyberattacks has also increased significantly over the years. Companies are now hiring business continuity teams and automating recovery processes using different software solutions that can help companies assess risks, process relevant data, as well as recover and protect critical business functions.
Why Your Business Needs a BCP
There are two main benefits to having this type of plan in place.
The most important benefit is the fact that it can help keep your business running during and after an unexpected event. By minimizing downtime and financial losses that may burden your operating budget, you can protect your employees, customers, and stakeholders.
Unexpected events can range from minor setbacks to disasters that could cost you your business altogether. Either way, having a business continuity management plan will allow you to focus on running your business more efficiently.
Besides, although having to define a business continuity plan can be tedious, it will help you comply with regulations. In some industries, having a business continuity plan is required by law.
Typically, businesses that operate in health care, financial, and government sectors are legally required to have a continuity plan in place. Otherwise, they face severe penalties from federal, state, or local governments.
What Does a Business Continuity Plan Typically Include?
There are four key components to a successful business continuity plan:
- Risk assessment: Identifying and assessing the risks that could potentially disrupt your business.
- Business impact analysis: Determining how a business disruption would impact operations. Sometimes, the disruption could be a minor one, e.g., having to hire a new person for a role. At other times, the disruption could be large enough to force you into bankruptcy.
- Recovery plan: This document should always be within the scope of a business continuity plan. It outlines the steps that need to be taken to recover from an interruption.
- Testing and maintenance: This is the process of testing the continuity plan to ensure that it’s effective and up-to-date.
Tips for Maintaining Business Continuity
To maintain business continuity, it’s essential to:
- Review the plan regularly: Just like when writing a business plan, you should review your continuity plan at least once per year. This will help to ensure that it’s up-to-date and effective.
- Test the plan regularly: This will help to identify any weaknesses or gaps in your continuity business plan.
- Train employees: Your employees should be familiar with the continuity plan for your business. This will help ensure that they know what to do in the event of an interruption.
By following these tips, you can ensure that your continuity plan is effective and up-to-date.
All in All
Creating a business continuity plan for your company is one of the most important steps you can take to ensure the future success of your organization. By having a clear plan in place, you will be able to minimize the impact of any potential disruptions and keep your business running smoothly.