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Continuity Central recently asked readers to help build a list of the benefits that business continuity brings. This article provides a summary of these.
The request to the readership followed a recent survey by the British Insurance Brokers’ Association (BIBA) and the UK Cabinet Office which found that business continuity offered the following benefits:
- Having a business continuity plan in place will keep businesses trading when they would have otherwise have probably failed due to an incident.
- Business continuity plans can significantly reduce the cost of disruptions.
- Companies with business continuity plans benefit from insurance premium discounts, reduced excesses and doors opening to new insurance markets.
- Having a business continuity plan allows what would otherwise be unacceptable risks to be insured.
In addition to the above Continuity Central readers identified benefits in the following 13 groups.
[Note: These summary points and responses are in no particular order; and, while the associated reader responses have been spell- and sense-checked, they have not been edited.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Maintains the delivery of protective services to the public which cannot be allowed to fail.
In the event of business disruption [it provides] the on-going ability to maintain a service or services to customers.
- Ensure that the organization is able to proactively identify the impacts of an operational disruption.
- Enables you to make the right decisions quickly.
- [Ensures that the business] has in place an effective response to disruptions which minimizes the impact on the organization.
- Knowledge of minimum levels and service delivery allows support resources from other parts of the business to be used to bolster disrupted areas.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Building customer trust and confidence.
- Appeal to customers in regulated markets.
- Increase the confidence of the customers over the organization’s capability and thus being more competent, when others fail to deliver .
- I am the BC Manager for a financial outsourcing company. Without our BS 25999, the evidence of plans, exercise reports and our comprehensive BC programme, many of our 'well known high street Clients' would be reluctant to pass business to us, if at all. I am constantly audited by current and prospective Clients about business continuity. It gives them the comfort they are looking for that we have put substantial effort into ensuring we can continue business under difficult circumstances. ]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Develops confidence in senior management's ability in being able to respond to a series of incidents and events in a formal, planned and tested way.
- There is an increased confidence in the general workforce in that they understand their jobs are not at risk and that something is being done to protect their livelihood.
- Makes CEO sleep better at night.]
[Reader response:
Additional benefits of having a business continuity plan in place are:
- Tested and updated business continuity plans can save lives.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Ultimately customers prefer your product and service, leading to possible increase in demand.
- Maintaining or increasing competitive position by: preventing significant harm to your corporate image and reputation; preventing the loss of customers and/or shareholder confidence; maintaining contractual requirements from key customers, partners (no disruption to your supply chain); preventing reduction of market share.
- Could enhance your reputation; and might gain a competitive advantage.
- Business continuity plan is an advantage for your customers when faced with the competition.
- It may be a customer requirement to have a plan in place.
- Gives you competitive advantage over those who don't do it.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Complying with regulatory requirements.
- Supports legal requirements (public records acts, companies acts, tax laws, anti-terrorist and anti-money laundering laws) to maintain records as well as compliance aspects.
- Legal requirements e.g. UK Civil Contingencies Act.
- Regulatory requirement.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Mitigating reputation & financial exposures.
- Preventing or minimising financial losses.
- Minimise financial loss.
- Valuation of assets on the basis of ‘going concern’. The accounting (final accounts including Balance Sheet) is done assuming the organisation will continue. If not, the assets will have to be valued in a different way, which is known as going concern of a basic principle. If an organisation does not have an acceptable BCP this should change the accounting, perhaps with a considerable risk factor. However, this check is ignored at large during accounting, and is normally accounted on the basis that the organisation will continue. In the same way the in recent years the new concept of risk adjusted rate of return on capital includes various risk elements including risk of continuity which will be positive if an effective BCP arrangement exists.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Preserves brand value - brand value is probably a company's biggest financial asset.
- Ensuring reputation of the organization in uncertain times (crisis management -communication plan).
- Mitigating reputation & financial exposures.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- Secures the supply chain.
- Ensuring continuity in delivering products and services (one or more disaster recovery plans).
- Ensure the delivery products and services, by being able to perform critical activities for the same. ]
[Reader response:
Additional benefits of having a business continuity plan in place are:
- Can help to create or reinforce an appropriate risk culture.]
[Reader response:
Additional benefits of having a business continuity plan in place are:
- Ensuring safety and health staff and visitors (safety and health plan).]
[Reader response:
Additional benefits of having a business continuity plan in place are:
- I'm not of the opinion that Business Continuity will reduce the cost of any incident or disruption; however [it will] enable [the organization] to be more resilient.]
[Reader responses:
Additional benefits of having a business continuity plan in place are:
- The analysis process that goes into building business continuity plans actually helps the business units know their business in more depth. By determining RTOs, inputs/outputs, dependencies, etc., there can be efficiencies gained through application of improved processes.
- Understanding what activities the business is involved in helps control the direction, and maintain focus on business objectives.
- Having a BC plan on its own is of little use unless the senior management team practices or exercises it. Practice and exercising increases the awareness of risk and increases the chances of the plans actually being successful and that the organisation can continue to operate satisfactorily following an incident. The team get to know more about the company and the individuals that make decisions under pressure and how they cope.
- Can improve your operations by identifying areas of inefficiency or risk.
- During the project where the BCP is elaborated, upgraded or review, the company usually goes through a process-analysis event. It usually allows the company to identify opportunity areas or projects, where they are directly related to the BCP (such as an alternate head office or ‘war room’, that can be used as a capacitation center to reduce costs) or indirect (such as identifying better Internet connections to treasury department that usually pays on Internet portals).The BCP great advantage is that an ‘as it is’ analysis is required.]
Continuity Central would like to thank everyone who took part in this consultation. To continue to discuss this article, click here.
•Date: 2nd March 2012 • Region: World •Type: Article • Topic: BC general
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