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Understanding Risk Assessment in Business Continuity Management
Business Continuity and IT Disaster Recovery Blog
Understanding Risk Assessment in Business Continuity Management
Any business serious about preparing for the future will invest in a business continuity management (BCM) plan. These plans are implemented to help ensure your business can get up and running again, regardless of the circumstances. Ensuring your business can avoid significant downtime is a big part of ensuring smooth operations for your firm. However, understanding risk assessment is vital when creating any business continuity management plan.
Risk assessment in business continuity management is critical because it helps you understand your most significant threats. For example, if your business’s main’ currency’ is data, data theft is one of your major risks. Natural disasters are part of your assessment if your business is based in an area with damaging and problematic weather or earthquakes.
In all forms of business continuity management, assessing the major risks involved in your business is a priority. Regardless of the state of risk, evaluating these risks’ impact is vital to ensuring your business continuity management process is robust enough to avoid disaster.
What Does Risk Assessment Require In Business Continuity Management?
Several factors should be included as part of all risk assessments that your business carries out on its business continuity management. Some of the most important factors, though, include:
- Understanding the most damaging processes to your business functions. What is most likely to knock your business out of business functionality entirely?
- Identifying the most significant risks to your staff. What situations are most likely to put your team in harm’s way or increase their risk of mental and/or emotional trauma?
- Appreciating the likelihood of each potential disaster/scenario. How likely is it that such an incident will take place? If it does happen, what are the best and worst-case scenarios?
- Creating a plan of action that can be implemented quickly to ensure your business can stop these hazards from occurring. Or, if they are unpreventable, how to recover ASAP?
- How can your business best control the situation so that you can retain some functionality in the event of a worst-case disaster? How can you create the ‘least bad’ outcome?
Any risk assessment in business continuity management should focus on the above. Like most business planning methods, it is easy to make mistakes. What, then, are some of the most common flaws that come into assessing risk in your business continuity management plan?
Common Flaws In Business Continuity Management Risk Assessment
Some of the issues that you are most likely to face when developing any BCM process include:
- Generic planning. Many business continuity management processes are very general; the best BCMs are unique to your business.
- Failure to ensure that the plan can be enacted in full remotely means that loss of operations does not mean loss of the plan being activated.
- Lack of transparency with staff, suppliers, and clients to help them understand the current situation and when a solution will be implemented.
- Failing to account for your most precious resource: your staff. How can your business cope if you lose the best members of your team?
- Not accounting for the emotional impact of a workplace incident, such as a natural disaster. How do your staff cope with the post-disaster process?
- Excessive reliance on third-party solutions such as insurance companies. This might cover the costs, but it cannot get your business up and running again.
These are common flaws in business continuity management, meaning that the plan does not take seriously the realistic risks your business will face.
Why Is Risk Assessment So Important To Business Continuity Management?
Without understanding where the problems might stem from, your business will likely rely on a generic plan for business continuity. Over time, this can create more problems than it resolves. Risk assessment helps to make your business more robust from dangers.
You might easily assume that the state will find solutions regarding natural risks, such as damaging weather, flooding, etc. However, relying on a third party is a hopeful exercise. Without a plan to deal with and contain these risks, you are hoping for good luck to get you through. Hoping for the best is not a plan, and it can leave your business stranded if you do not act accordingly.
The same goes for man-made incidents, such as data theft, denial of service attacks, or hacking. It is easy to assume you are a small-sized business; surely these hackers would target a big business instead?
However, big businesses are expensive to hack into – and it is easier to be caught in the act. Smaller companies are ripe for cyberattacks because it is easier to get in and back out without being caught. Without assessing the risk of man-made attacks on your company, you make cybercrime easier.
Risk assessment is vital because it allows you to keep your eyes open to the existing threats. This means taking positive action and stopping your business from being caught cold is easier. There will also likely be an unforeseeable risk, but your business must be logical. Preparing for the most likely risks and challenges to business continuity is important.
You cannot prepare for the unique, one-in-a-billion incidents that could rock your business. You can, though, assess the more commonplace risks within your industry.
Do Not Delay On Risk Assessment
Whether your business already has a business continuity management module in place, or you are planning to do so, make risk assessment a priority. The risks you evaluate, their likelihood, and the consequences should they happen will ensure that your business is prepared for such incidents.
Over the years, this kind of preparation will pay dividends. You will find it easier to keep your business operating in some capacity. You will also have a clear set of steps and plans to follow. Risk assessment helps ensure that you have adequately prepared for each (realistic) risk your business could face.
BRCCI – Business Resilience Certification Consortium International (www.brcci.org)
We are thankful to the author for allowing us to post this insightful article on our website. BRCCI provides a comprehensive training and certification program in business resiliency, continuity and IT disaster recovery planning:
1. 3-day CBRM (Certified Business Resilience Manager) is a comprehensive, all-in-one, 3-day Business Continuity Planning and Management Training and Certification course which is designed to teach practical methods to develop, test, and maintain a business continuity plan and establish a business continuity program.
2. 3-day CBRITP (Certified Business Resilience IT Professional) is a comprehensive training on how to assess, develop, test, and maintain an information technology (IT) Disaster Recovery Plan for recovering IT and telecommunications systems and infrastructure in the event of a disaster or business disruption. The training provides a step-by-step methodology to ensure a reliable and effective IT disaster recovery and continuity plan consistent with the industry’s standards and best practices.
3. 2-day CBRA (Certified Business Resilience Auditor) It provides 2 days of intensive, Business Continuity Audit training to enable students to determine the effectiveness, adequacy, quality and reliability of an organization’s Business Continuity Program. Students will learn an audit methodology to evaluate compliance of Business Continuity and IT Disaster Recovery Programs with the current industry’s best practices and standards including:
- ISO 22301: Business Continuity Management Systems – Requirements
- NFPA: Standard on Disaster/Emergency Management and Business Continuity Programs
- ITIL: Information Technology Infrastructure Library
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