Business Continuity Planning (BCP) for Businesses of all Sizes

By May 7, 2019 No Comments

Accidents happen. From power outages and sick days, to natural disasters and dramatic and sudden financial crises, business face countless threats, challenges, and disruptions. A business Continuity Plan is essentially a document which is drafted with the detailed steps a business can take to stay trading during a disaster. It will be the framework used to direct the business through recovery.

And a disrupted business isn’t a profitable one so outlining effective and realistic responses to disasters to get your business back up and running as soon as possible.

Preparing a strategy which outlines contingencies for a host of possible threats increases the resilience of a business. Having a plan in place following a disaster can give the business a direction and a schedule back to profitability.

With a business continuity plan, organizations construct an effective crisis response which can ensure you are; safeguarding an organization’s reputation, the integrity of its brand, and the interests of its key stakeholders during a chaotic time.

Development of a business continuity plan (BCP) consists of several primary factors:

• Review an organization’s critical and/or time-sensitive processes, quantifying the impact of their potential loss
• Evaluate said procedures to ensure functionality, with periodic reviews of process, ensuring compliance with current best practices
• Prepare for unanticipated risks, ensuring continuity in circumstances beyond organizational control
• Develop risk mitigation strategies for responding to and managing incidents
• A response and recovery plan in case of crisis

Example of a BCP Exercise

For a hypothetical example of a BCP, let’s say we have an insurance provider based in Sydney. Anticipating possible crisis situations, they create an offsite file backup—depositing both its internal databases, and its client files—in a secure, external location. This way, if disaster befalls the home office, projects could continue with minimal interruption, and critical data wouldn’t be truly lost.

According to a recent survey, downtime and data loss have cost Australian businesses approximately $65.5 billion (US$55 billion) across a 12-month period. Additionally, 64% of the organisations surveyed lost time and data during that period.

Which Situations Should my Business Plan For?

It’s an inarguable fact of doing business; the unexpected happens. But a comprehensive BCP is critical to the long-term survival of any organization. No one can anticipate every possible threat to an organization, but a solid plan that covers a wide range of potential incidents can provide maximal organisational security. Having a brainstorming session with others to suggest scenarios (no matter how far-fetched) can be helpful in planning your BCP. Better to be over prepared than under prepared.

To ensure optimal efficacy, every BCP should incorporate a regular schedule for testing and updating your crisis plan, accounting for the dynamism of the organisation, industry shifts, and any regional trends.

We will be covering more detail on this topic in the coming months, so be sure to sign up for our newsletter to be notified when we publish next.

Jake Elliott

About Jake Elliott

Jake Elliott is a Chartered Accountant with extensive experience offering Outsourced CFO and other consulting services to businesses. His background working "in-business" allows him to provide clients with insights into their operational and financial performance beyond the capabilities of their accountant/bookkeepers.