A Business Continuity Plan (BCP) is a framework that ensures an organization can continue operating during and after disruptions such as natural disasters, cyber-attacks, fires, product recalls or other crises.
We review these plans for clients all the time as they can be crucial in an organisation successfully navigating a critical incident. It is fair to say, what we find is wide and varied in terms of the standard and depth of the plans developed. Many are crisis plans, not continuity plans, many have come straight from Chat GPT!
What we find is that very often people get mixed up in the terminology. Confusing crisis plans and disaster recovery plans with business continuity. The graphic below helps with this. To be clear BCP is about handling interruptions to your operations. To make this even simpler it is how we ensure we get our products (or services) to customers when an adverse event has occurred.
The Importance of Business Impact Assessment (BIA)
A Business Impact Assessment (BIA) is a foundational step in developing a robust BCP. It involves analysing your business through your whole supply chain to determine the potential impact of disruptions on operations, financial stability, and customer service. Done properly, it starts with your suppliers, identifying those suppliers that may cause issues for you if they have an issue. Then we step through your production process to identify bottlenecks or vulnerabilities that could slow or stop supply to the customer if impacted.
The best tool to use is a process flow diagram for this activity, and if one is not available, we often ask to see the HACCP plan for a food safety business, which uses a similar approach to identify food safety issues within the business.
Key Components of a BIA
- Identification of Critical Functions – The BIA identifies essential business processes that must be maintained during a crisis.
- Impact Analysis – It assesses the financial and operational consequences of disruptions, helping organizations prioritize recovery efforts.
- Recovery Time Objectives (RTO) and Maximum Allowable Outage (MAO) – These metrics define acceptable downtime and provide critical prompts for making decisions and enacting plans.
- Resource Assessment – The BIA determines the resources, including personnel, technology, and third-party support, needed to maintain operations.
By conducting a thorough BIA, organizations can tailor their BCPs to address vulnerabilities and ensure timely recovery from disruptions.
Developing an Effective Business Continuity Plan
The BIA will identify the critical processes. The BCP then defines detailed steps to implement for each of these critical processes assuming they are interrupted. Importantly, the cause of the interruption is irrelevant. Fire, flood, product recall, it doesn’t matter. The process is not available, how do we continue to supply our customers.
The options for managing the interruption will of course depend on the scenario but can include moving production to alternate production facilities or outsourcing to third parties. We may need to manage existing stock, for example more critical customers may be prioritised for delivery and others delayed.
Continuity Plans typically have two streams of activity and resources should be allocated accordingly:
- Reinstatement – an appropriate level of resource needs to be applied to rectifying the cause of the interruption and reinstating supply, and
- Continuity – ensuring we maintain supply to customers.
Conclusion
A BCP is a document we hope we never have to use. A good one will minimise disruption and could actually be a competitive advantage if the crisis effects your competitors. We often get asked for a template, and sure there are templates available, but a proper process ensures there is a deep understanding of the interruption vulnerabilities, which will ensure businesses are better prepared to respond.
Contact us for more information and enquiries.