Staying afloat in turbulent times

In a recession business continuity planning is more important than ever, says Chris Alvord, CEO of COOP Systems.

Imagine a cruise line removing lifeboats from their ships because they felt the need to make budget cuts and decided this was how they would stay afloat in the murky economic waters today. Would you and your family set sail on their boats, knowing that they had no backup plan in case of an accident at sea? Most people wouldn't take the unnecessary risk. Why should businesses operate without a safety net and risk losing everything on a natural disaster or supplier problem? A wide variety of interruptions threaten businesses worldwide on a daily basis. The question is not it an incident will occur; it is when. Establishing a proper business continuity management (BCM) programme will help mitigate these future losses and ensure your business will pull through strongly after any kind of interruption.

BCM evolution

Although the practice of continuity planning is several decades old, it has undergone many changes in type and scope. Originally, plans focused solely on mainframe recovery and were referred to as "disaster recovery" plans. As planning grew to encompass the business side of corporate operations and address new vulnerabilities, disaster recovery evolved into "business continuity". New positions were created to focus solely on planning and testing efforts. Regulatory bodies worldwide enforced this new set of responsibilities by mandating the creation of planning programmes in organisations of certain size and industries.

Today, budgets are shrinking and cuts are being made across all lines of business. Regulations enforcing the build up of BCM programmes fall short on audit standards and requirements for regular updates, leaving plans to turn stale 'on the shelves' of corporations. Even well-documented incidents like the New York City transit strike of 2005 and the London subway bombings of the same year aren't strong enough reminders of the importance of up-to-date, well-exercised plans. Some organisations are cutting back their BCM programs in an effort to meet budget cuts, leaving themselves open to vulnerabilities just as threatening today as they were in years past. Even worse, new threats have arisen recently that need to be assessed and mitigated with fewer resources available.

Now, more than ever

A current threat to business operations across the globe is the H1N1 virus. For example, it has had a direct impact on the transportation industry, most notably with Delta Airlines claiming US$250 million of revenue losses in the second quarter of 2009. In a July 2009 report, Oxford Economics concluded that the overall impact of the outbreak within the UK could total five percent of the country's GDP, with over 120,000 small businesses closing as a result -one of the worst economic crises to hit in decades.

A BCM programme is more important than ever, considering the broadening spectrum of immediate threats like H1N1. The good news is that there are many ways organisations can work smarter and do more with less. Dropping a BCM program altogether or allowing plans to age beyond their 'expiration date' is simply not a good business practice. Automating the BCM programme is one way to maintain plans and ensure preparedness. Many excellent software packages are available that support the process across an organisation in many ways, including scheduling reminders for updates. The burden is eased on C-level management, allowing departmental employees to efficiently share in ownership and accountability.

Further, much of the BCM process can then be fully automated. Examples are live feeds that update details on contact lists, assets, facilities and so on.

Another way to maximise efforts is to partner with local organisations contributing to emergency preparedness. Running exercises with local or state government agencies or inviting the local Salvation Army or Red Cross chapter to participate in an exercise with your organisation usually costs nothing more than a lunch. The return on investment is immense for both training and relationship building with community organisations and could very well save your organisation in a time of need.

Chris Alvord is CEO of COOP Systems, a worldwide BCM software supplier. He has a CBCP certification from DRII, taught hundreds of students as an adjunct professor at NYU, USDA Graduate School and for DRII. His education includes a BA and MBA from Harvard and doctoral work at Virginia Tech.