Does Your Organisation Have a Business Continuity Plan?
How important is business continuity planning within your business? A greater focus on developing business resilience is needed in many organisations in the face of increasingly large and unpredictable business interruptions and risks to supply chains. As businesses become more reliant on technology and global supply chains, they are much more vulnerable to disruption. This leaves businesses exposed to a complex array of unpredictable risks.
Supply chains have become highly complex and concentrated with entire sectors reliant on a single or small number of specialist suppliers. A key supplier or buyer can be debilitated for several reasons. These could include fire, key mechanical failure, natural floods, electronic security breaches or technical power failure and hardware or software viruses. These events can have a dramatic effect on supply chain partners, both upstream and downstream.
Cyber security attack is also emerging as a significant business interruption risk as we’ve become increasingly dependent upon technology and data, which can fall foul to technical flaws and human error.
Business Continuity Planning – The Worrying Statistics
The statistics around disaster recovery and business continuity planning in practice in the UK highlight cause for concern.
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Over half of firms surveyed by the Business Continuity Institute have experienced at least one interruption in their supply chain in the past twelve months
Natural catastrophes have emerged as a key driver for business interruption losses. These can vary from fire and or explosion, structural damage and partial or full loss of a business, causing disruptions to the production and delivery of goods/services.
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Around 50-70% of property damage claims now involve business interruption
An increasing number of businesses have found themselves to be victims of cyber-attacks, highlighting the need for greater emphasis on business continuity planning by the senior management team. Don’t let your organisation suffer from lacking cyber-cover!
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More than 39% per cent of businesses experienced a cyber-attack in the past year. Yet, just 11 per cent have a cyber-security insurance policy.
Many businesses are simply underprepared for unforeseen events.
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Less than a third of businesses (29%) have developed risk management plans for unexpected events.
Of the companies that do have written business continuity plans in place, they are often not kept up to date or tested.
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Only 17% of companies with written business continuity plans say that they carry out stress tests.
Although some companies have invested in risk management and crisis management, major business interruption incidents continue to happen with surprising regularity and many organisations struggle to recover from a major event.
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1 in 4 businesses impacted by a business interruption never re-open their doors after an unexpected disaster
Benefits of Effective Business Continuity Planning
Given the statistics highlighted above, the benefits of putting a robust business continuity plan in place should be clear.
- Business continuity planning challenges you to evaluate the effectiveness of your current risk management practices, thus reducing the likelihood or impact of an unexpected disaster.
- A robust business continuity plan prepares your business for an interruption. By developing a disaster recovery plan, you can minimise the damage associated with closure, production downtime, personal injury claims, lost stock and so on.
Be sure to educate your staff on the appropriate emergency response and escalation procedures identified within the plan. This will enable them to respond quickly and initiate damage limitation measures in the event of an unexpected event that impacts on business continuity.
How Can ABL Group Help You?
Our business continuity planning team can provide the following support services to clients:
Risk Assessment Audit
We will assess the risks that your business may encounter. In doing so we will identify potential crises and vulnerable parts of your business and advise how you can protect against them.
Business Continuity Plan Development
We will formulate your Business Continuity Plan and provide practical support to enable you to implement it. This will include planning critical activities for implementation before, during and after an incident.
Emergency Response Training
We can train your employees in emergency evacuation procedures and designated roles of responsibility. By working with your team to develop your incident management skills, you will be better prepared to take control until the emergency services arrive.
Business continuity planning is extremely important, but wider resilience, with a greater focus on risk management and “what if thinking” is needed if companies are to survive both during and after such unpredictable events.
Is your organisation truly prepared to cope?
For further information and guidance contact our Risk Manager David Sinnamon at: david.sinnamon@ablinsurance.co.uk