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Business Continuity And What That Means To You?

Prue Younger, CEO Message

In this climate where we are constantly influenced by the markets and now on top of that COVID and the many variants that the world is being tried and tested with, there is not much we can do as contractors, service providers or employers to change any of it. However, we can anticipate, plan and respond. You will be hearing the words ‘Business Continuity Plans’ inserted into everyone’s communications now, but really what does that mean for us?

Business continuity may be defined as “the capability of an organisation to continue the delivery of products or services at pre-defined acceptable levels following a disruptive incident”, and business continuity planning (or business continuity and resiliency planning - BCP) is the process of creating systems of prevention and recovery to deal with potential threats to a company. As well as prevention, the ideal state is to enable ongoing operations before and during the execution of disaster recovery. Business continuity therefore is the intended outcome of proper execution of both BCP and disaster recovery. As a business reviews its sustainability, it should also be looking at the organisation's resistance to failure or the ability to withstand changes in its environment and still function. You may also hear this being referred to as the resilience of a business. You need to ask yourself: ‘Can our business endure environmental changes without having to permanently adapt, or do we find ourselves in a situation that we need to adapt to a new way of working that better suits the new environmental conditions?’. COVID and market fluctuations are events that could negatively impact operations and should be included in the plan, as well as supply chain interruption, loss of or damage to critical infrastructure (major machinery or computing/ network resource). A Business Continuity Plan outlines a range of disaster scenarios and the steps the business will take in any scenario to return to regular trade. These plans should be written ahead of time and can also include precautions to be put in place. They need to be written with the input of key staff as well as stakeholders, with a set of contingencies to minimise potential harm to businesses during adverse scenarios. I guess one could use some other terminology to explain continuity planning. Some call it strategic resilience, and more commonly let’s use preparedness, responsiveness and recovery plans too. Are you getting the idea now that it’s a relatively generic business technique but the question is whether we as employers, business owners, contractors have ever thought to do this ahead of the events? Components of continuity and resilience include: • Creating a sense of normality • Ensuring workplace culture and identities are maintained • Continuing communication networks • Downplaying negative feelings, yet recognising these at the forefront And when a crisis occurs there are a number of groups that a business needs to recognise and cater to, namely, the individual, the organisation and the national network that it operates in. Proactive resilience is preparing for a crisis and creating a solid foundation for the company. Post-resilience includes continuing to maintain communication and check in with employees. Proactive resilience is dealing with issues at hand before they cause a possible shift in the work environment and post-resilience involves maintaining communication and taking the learnings after an incident has happened. You can be assured that there will be several businesses that do not have plans and there is no reason why the industry cannot get together to collectively discuss this rather than thinking the individual contractors must do it in isolation. So, in simpler layman’s terms, some Q & A’s:

Why is Business Continuity Planning Important?

Businesses are prone to a host of events and disruptions that vary in degree from minor to catastrophic and BCPs are an important part of any business. BCP is typically meant to help a company continue operating in the event of threat and/or disruptions. This could result in a loss of revenue and higher costs, which leads to a drop in profitability. And businesses can't rely on insurance alone because it doesn't cover all the costs and the customers who move to the competition.

What Should Business Continuity Planning Include?

BCP involves identifying all risks that can affect the company's operations. The plan should also determine how those risks will affect operations and implement safeguards and procedures to mitigate the risks. There should also be testing of procedures to ensure these safeguards and procedures work. Finally, there should be a review process to make sure that the plan is up to date.

What Is Business Continuity Impact Analysis?

An important part of developing a BCP is a business continuity impact analysis which identifies the effects of disruption of business functions and processes. It also uses the information to make decisions about recovery priorities and strategies. The analysis should summarize the impacts—both financial and operational—that stem from the loss of individual business functions and processes. They also identify when the loss of a function or process would result in the identified business impacts. There will be support around you to help with this and you may well be a good way down the track of having this plan in place but if not, ask your accountant, your bank manager and check out: www.business.govt.nz Type in Small Business Continuity Plan — Is Your Business Prepared?