A business faces different threats as it operates. And these threats may force a business to shut down. That is why Business Continuity Plans are important to a business. Business continuity plans help companies survive natural disasters, economic downturns and bad publicity. It is a document that contains the critical information a business needs to stay running in spite of adverse events.
A business continuity plan is also called an emergency plan. The ability of an organization to recover from a disaster is directly related to the degree of BCP (Business Continuity Planning) that has taken place before the disaster. Industry analysts claim that two out of five businesses that experience a disaster will go out of business within five years of the event.
A BCP need not be specific to terrorist incidents and apply to any major disruption such as a major fire, flooding or power fault. The plan itself sets out the agreed arrangements for bringing events under control, the necessary resources for maintaining critical business functions and the staff required for co-ordinating actions. It also needs to be clearly presented, avoiding vague internal references and abbreviations, and structured in such a way that people can quickly find and understand what is expected from them.
A comprehensive business continuity plan forces leaders to review the weaknesses and threats to their organizations from a detached perspective. While few business leaders want to focus on negative "what if" questions, the process of creating a continuity plan can raise concerns about employee development, real estate selection and intellectual property security. Tight plans can assure teams that company leaders understand how to turn on a dime during challenging times.
Consideration of risk is necessary; however, not all risk can be fully avoided, and businesses may need to accept partial residual risks. Business continuity planning is the tool used to manage these residual risks. Using the data derived from the process of developing a risk management profile, business continuity planning takes the next step by assuming that a disastrous event will, in fact, occur in the future.