Why Every Business Should Have a Business Continuity Plan
In today’s unpredictable business environment, it’s important for companies of every size to think ahead and make a plan for unforeseen and potentially damaging events, like cyberattacks or natural disasters. The best way to accomplish this, and protect your business, is with a business continuity plan.
If you aren’t sure whether your company has a business continuity plan, or question its effectiveness, check out our refresher below for information on why a business continuity plan is vital for all companies.
What is a Business Continuity Plan?
A business continuity plan is a clear and well-documented strategy that outlines how a business will continue to operate in the event of disaster or emergency. These events can range from weather disruptions like a fire or hurricane, to cyberattacks such as ransomware. Sample components of a business continuity plan include, but are not limited to, the following:
- Business Impact Analysis (BIA): The BIA is a valuable process that helps businesses evaluate threats that could impact day-to-day business operations, consider the likelihood that potential disasters will occur, and estimates the overall business impact.
- Procedure for Employee Communication: This component is essential and two-folded. First, it’s important that you train and educate employees on how to protect against an attack. Second, you should have a plan in place for how you will communicate with employees if your business becomes a victim of a natural or human-induced disaster.
- Plan for Data Protection: As any business owner understands, data is critical to the success of the company. That’s why, it’s advised that all businesses implement a process for data protection, inclusive of secure storage options like Big Sur Technologies’s MyCloud, as well as periodic quality control check-ins. Why is this so important? Because data is valuable. For example, a recent Verizon report found that “small data breaches, those with fewer than 100 files lost, cost between $18,120 and $35,730”—meaning that breaches over 100 files lost could be financially detrimental to a business (Entrepreneur).
What Types of Businesses Need a Business Continuity Plan?
Simple. Every business needs a business continuity plan. To further demonstrate, see below for some compelling statistics and real-life examples on how businesses of every size can be impacted, and why all businesses should have a business continuity plan in place:
- Closed for Business: “Roughly 40 to 60 percent of small businesses never reopen their doors following a disaster.” – Federal Emergency Management Agency (FEMA)
- Long Road Ahead: For those business that do stay open (see above bullet) “only 29 percent were still operating after two years.” – Forbes
- Loss to Competitors: “When Whatsapp was down for 4 hours, 7 million users flocked to its competitors, Telegram and Line.” – Datto
These are just a few examples of how companies, ranging from small businesses to large corporations, have experienced real disasters. And while a business continuity plan may not be able to protect a business from a disaster, it does help provide a plan on how to respond and recover.
I’m Still Not Convinced. Is a Business Continuity Plan Really That Important?
The short answer is, yes, a business continuity plan really is that important. If you don’t have one, it’s advised that you start now and set a firm completion deadline—with a goal of sooner rather than later. In addition, it’s important that you don’t push it off or rely on false assumptions, like the ones listed below, which if followed, could be detrimental to your business.
- False Assumption #1: Employees will know what to do in the event of an emergency or disaster. Before you rely too much on this assumption, ask yourself, “Are you confident that if you asked every employee today what to do in the event of a disaster, like a hurricane, that they would give the same response and confidently be able to execute the same plan as their colleagues?”
- False Assumption #2: Insurance will cover the cost damages. However, according to the insurance company, Travelers, this is not good philosophy to follow because “insurance alone is NOT a business continuity strategy. Proper coverage is a significant and important part of the plan. But it may not fully cover some of the peripheral damages from an event, like loss of customers, loss of market share, or setbacks in development or release of a new product.”
- False Assumption #3: The time and financial investment aren’t worth it, a potentially-damaging assumption, especially if your business decides against a business continuity plan altogether. For example, if a business forgoes a plan, and is then hit with a disaster scenario, they would see repurussions and damages in some or all of the following areas: revenue loss, customer retention and acquisition, partnership status and reputation.
Where do I Start?
To help you get started, we’ve outlined our recommended steps to help create your business continuity plan below.
- Step 1: Consider the business impact on your bottom line with a Business Impact Analysis (BIA)
- Step 2: Set a plan for employee safety, communication, training, and education
- Step 3: Create a strategy for providing customers with information and reassurance
- Step 4: Prepare business operations to eliminate or reduce downtime
- Step 5: Test and and refine your plan
If you’re interested in learning more about how to create your business continuity plan, our team at Big Sur Technologies would be happy to help. Contact our experienced team and we can get you started!