Why every business needs a business continuity and disaster recovery plan

A business continuity and disaster recovery plan will strike many business owners as a ‘nice to have’ rather than a must-have. Or you might think it’s essential for certain business functions (like IT) but less important in others (like PR, Comms, or HR teams.)

We’re here to break the news that you absolutely do need a business continuity and disaster recovery plan for your business. Not having one leaves your business vulnerable to threats — from cyber-attacks to natural disasters. It puts your revenue at risk. And, worst of all, it puts your people at risk too. 

Having a good business continuity plan sets you up for enduring success. Because we all know: stuff happens. And no matter how good you think you are in a crisis, having a clear plan that outlines proactive strategies will mean you can jump straight into rapid recovery when disaster occurs rather than waste time procrastinating. 

The top threats to most businesses

You may feel that business continuity and disaster recovery is something that businesses of a certain scale need, but that doesn’t apply to your business. Or maybe you’re just resigned to “being in hot water” if bad things happen. It’s really common for business owners to think this way. But it’s a misconception:

  • First, all businesses—no matter their size—are vulnerable. Whether it’s a cyberattack or a natural disaster, certain events can suddenly and dramatically impacted your business.
  • Second, all businesses can take steps to mitigate such events. It will give you peace of mind and confidence to know you have prepared for these scenarios—in much the same way as having rainy-day savings or a life insurance policy gives you a sense of security. These are things we all hope we never need, but if/when bad things do happen, they can be the difference between survival and ruin.

What vulnerabilities does your business need to worry about most? 

Every business is different, and threats can depend on the industry, location, and other factors. But these are some of the top threats to most businesses:

Natural disasters

Natural disasters such as hurricanes, floods, earthquakes, wildfires, and tornadoes can cause significant damage to physical infrastructure and disrupt business operations.

Cyberattacks and data breaches 

Cyberattacks and data breaches can result in data loss, system downtime, and reputational damage. They can also result in financial losses, regulatory fines, and legal liability.

Human error 

Mistakes or errors made by employees, contractors, or vendors can result in system failures, data breaches, or other disruptions to business operations.

Supply chain disruptions

Disruptions in the supply chain, such as material shortages, production delays, or transportation disruptions, can impact a company’s ability to deliver products or services to customers.

Power outages

Power outages can occur due to natural disasters, equipment failures, or cyberattacks, and can result in system downtime and data loss.

Pandemics and other public health emergencies

Pandemics and other public health emergencies can disrupt business operations by requiring employees to work remotely, disrupting supply chains, and impacting customer demand.

It’s important for organizations to identify the specific threats that are most relevant to their business and to develop appropriate plans and strategies to mitigate those risks.

Okay, but what is a business continuity and disaster recovery plan? 

A business continuity and disaster recovery plan (BCDR) is a plan that comes into effect when any event interrupts your business’s uptime. When companies have downtime, they lose money. So minimizing the impact of downtime helps ensure your business gets back on its feet quickly and minimizes lost revenue.

Many organizations have some form of BCDR on the IT side, as disaster recovery is a key function of IT systems. However, BCDR is much broader than ensuring your tech stack is stable and secure. It incorporates the following:

  • Employee safety
  • Brand and reputation management
  • Crisis management
  • Alternative work locations
  • And, yes, systems security and data protection

As such, a business continuity and disaster recovery plan is a deep plan that requires thoroughness. While it may not be possible to anticipate every possible disaster that may befall your business, it is possible to develop plans to fall back on when disasters do inevitably occur.

Business continuity planning: Where to start?

Now that you’re (hopefully) realizing the importance of business continuity planning, you’ll be keen to understand where to start. It’s natural to feel overwhelmed. It can be hard to know where to start developing a plan that’s broad enough to apply to a wide range of situations, from natural disasters to PR crises, but that’s specific enough to be helpful and actionable when crisis occurs.

Thankfully, the field of business continuity and disaster planning is pretty established and there are some tried-and-trusted methodologies for kicking off business continuity planning. Naturally, the first thing you want to do is assess. If you don’t know your vulnerabilities and critical areas, it’s hard to prioritize the actions you need to take should disaster arise. Taking stock of your business with a cool head will help you hone in on the most important aspects of a business plan.

Business continuity management (BCM)

Business continuity management (BCM) is the process of identifying potential threats and risks to an organization, developing plans to mitigate those risks, and ensuring that the organization is prepared to respond effectively to a crisis or disruption. 

The goal of BCM is to enable an organization to continue its critical operations during and after a catastrophic event, whether that event is a natural disaster, cyber-attack, or any other unexpected occurrence that could impact the organization’s ability to function.

Ready to get going? Here’s where to start:

  1. Identify critical functions: The first step in creating a business continuity plan is to identify the critical business functions and processes that are necessary to keep the organization running. This could include things like payroll processing, customer service, order fulfillment, and supply chain management.
  2. Risk assessment: Once critical business functions are identified, a risk assessment should be conducted to identify potential threats and vulnerabilities that could impact those functions. This could include things like natural disasters, cyberattacks, power outages, or other disruptions.

A business impact analysis (BIA) will help with these steps

Part of your business continuity management process may be to conduct a Business Impact Assessment (BIA.) A BIA is used to identify and evaluate the potential impacts of disruption on critical business functions and processes. 

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Everything you need to know about Business Impact Analysis
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The goal of a BIA is to identify the most important business functions and processes that you need to restore quickly after a disruption. It will also help you quantify the potential impacts of a disruption on these functions, so you will know exactly what any delay will cost your business.

Step 1: Identify critical business functions

During a BIA, an organization will typically identify the critical business functions and processes that are essential to its operations. If you have a larger organization you may engage your business leaders to take inventory of the personnel, technology, tools, and facilities it needs to run and to gauge the impact of downtime on each.

For example, if you run a manufacturing business, the impact of your assembly line being down for an hour can be significant – resulting in unfulfilled orders, unhappy clients, and lost revenue. In contrast, the impact of your social media scheduling tool being down may be merely annoying, but may also impact your ability to provide customer support. However, with the social example, there might be alternative channels that can serve as a backup.

Step 2: Identify resources needed to support each function

For each function or process, your organization will need to identify the resources needed to support it, such as personnel, technology, and facilities. This can help you identify, for example, that only one person knows how to operate a certain system — and if anything were to happen to that person the impact to your business could be significant.

Step 3: Assess potential impact

You’ll then assess and quantify the potential impacts of a disruption to these resources, such as:

  • Health and safety risks to employees
  • Loss of revenue
  • Increased expenses
  • Reputational damage
  • Regulatory non-compliance

The BIA is a crucial component of your business continuity plans, as it helps your organization prioritize your disaster recovery strategies and efforts and allocate resources accordingly. 

By identifying the critical functions and processes that must be restored quickly following a disruption, your organization can develop recovery strategies that are targeted and effective, and minimize the impact of the disruption on its operations.

The frequency at which you should conduct a Business Impact Assessment (BIA) will depend on several factors, including your business industry, size, complexity, and risk profile. However, as a general rule, organizations should conduct a BIA at least once a year or whenever there are significant changes to the organization’s operations or risk profile.

How a BCDR plan comes to life: Three branches

Armed with all of this information, you’re ready to start your BCDR plan in earnest. We usually consider that there are three branches to a BCDR plan – you can read about them in more detail here, but we’ll cover the three branches below too.

1. Emergency response

Your emergency response focuses on the immediate response to a crisis or emergency situation. Think of this as your “to-do plan” if there’s a natural disaster, cyber-attack, or any other unexpected event that can disrupt business operations. In the fire drill example, this would be as simple as “sound the alarm and evacuate the office building using emergency exits.”

The main objective of an emergency or disaster response plan is to ensure the safety of employees and minimize damage to your business property, information, and infrastructure.

2. Crisis management & business continuity

Once you’ve got past the initial response to the emergency, you can begin to manage the situation and ensure your business operations can resume. You’re not out of crisis mode yet, but you’ve stabilized things enough that you can move from reactiveness to active management.

Crisis management deals with the restoration of critical business functions after an interruption, including the recovery of data, systems, and operations. The objective is to ensure that business operations can be resumed as quickly as possible and minimize the impact of the disruption. For example, you might have a list of business partners you need to immediately call to inform and reschedule meetings or deliveries.

3. Disaster recovery

With the crisis now under control, you can start to rebuild and resume normal operations—this is your disaster recovery strategy. Whether you’re rebuilding infrastructure, recruiting new team members, or regaining customers’ trust, this stage is about getting your business back to where it was.

But you shouldn’t forget the experience and lessons you learned. Disaster recovery plans also focus on the proactive measures that organizations can take to mitigate the impact of another potential disaster or crisis.

Disaster recovery planning includes risk assessment and risk management, developing contingency plans, and establishing procedures and protocols for responding to emergencies. The objective is to reduce the likelihood and severity of a disruption to business operations again.

BCDR is not a one-and-done: Test, iterate, and improve your business continuity plan

Phew! You now have a BCDR plan. You can file it away and rest easy now, right? Sorry, wrong! Just like running regular fire drills, your BCDR plan needs to be constantly tested and iterated. Moreover, every time you do a new business impact analysis (or BIA), you’ll potentially identify new areas of vulnerability that your BCDR needs to account for.

Here are some steps to follow when testing your BCDR plan:

  • Define the testing objectives: Define the objectives of the test. This can include testing the effectiveness of specific recovery procedures, identifying weaknesses in the plan, or assessing the readiness of key personnel.
  • Develop a testing strategy: A testing strategy will outline the scope of the test, the testing approach, and the expected outcomes. This should include a detailed test plan that identifies the testing scenarios, the resources needed to conduct the test, and the criteria for success.
  • Conduct the test: Run the test according to the testing plan. This may involve simulating a disaster scenario, testing specific recovery procedures, or conducting a tabletop exercise to test the response of key personnel.
  • Evaluate the results: Evaluating results may involve reviewing the test data, conducting post-test interviews with key personnel, or analyzing the effectiveness of specific recovery procedures.
  • Improve: We all love glowing test results, but with BCDR tests, you want to identify areas for improvement. Based on your results, improvements to the BCDR plan may be identified and implemented. These may include revising specific recovery procedures, updating the contact list for key personnel, or investing in additional resources to improve the organization’s overall readiness for a disaster.

Overall, testing a BCDR plan should be thought of as one of your critical business processes. It helps to ensure that your organization is prepared to respond effectively to a disaster or disruption. By following a structured testing process, your organization can identify and address weaknesses in the plan, and increase its overall level of preparedness.

Curious to learn more about BCDR?

Ready to get started and/or need help? Working with the experts at Thoropass can help you build the foundations for a resilient business that stands the test of time, including building and maintaining a rock-solid business continuity and disaster recovery plan.

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