Business Tips

Secure Your Future with a Business Continuity Plan (BCP)

If the past year has taught us anything, it’s that things can happen unexpectedly, and the best thing you can do as a business owner is be prepared with a business continuity plan. It’s important to familiarize yourself with business continuity planning so you can prepare for any potential interruption. Interruptions can result from natural disasters, unexpected downtime, fires, or security breaches. A business continuity plan can help protect your business and give your employees and customers a sense of direction when issues arise. Otherwise, you could be caught off guard without a plan, which can have dire consequences. In 2020, businesses in the U.S. suffered major setbacks due to COVID-19. For many, having a BCP in place is what helped them survive during uncertain times.

This article will help you define what is a business continuity plan, the circumstances they come in handy for, and how to create one for your business. If you’re ready to make a game plan for your business, let’s begin.

What is a Business Continuity Plan?

business continuity

You’ve probably heard of a business financial plan or even an operational plan that businesses create to keep on track. But exactly what is a business continuity plan?

A business continuity plan (BCP) outlines, in writing, the ways a company will continue to operate during an unplanned service disruption. The plan provides a detailed outline of how a business will operate during short-term and long-term interruptions.

Why Business Continuity Planning is Important

Business continuity planning makes it possible for your business to weather any storm that may come its way. Developing a business continuity plan is extremely important because the faster you can recover from a disruption, the fewer profits you will lose. Likewise, the longer it takes to recover from a disruption, the less likely your business will be to fully recover.

Planning is also important because you cannot depend solely on insurance if you encounter a disruption. Insurance will not cover the money lost from losing potential customers and may take some time to arrive. By developing a well-detailed and thought-out business continuity plan, businesses can achieve the following:

  • Ability to prevent threats and recover more quickly from security breaches, cyber-attacks, vandalism, natural disasters, or employee illnesses
  • Capacity to safeguard personnel and assets, making sure employees respond quickly when an unexpected event occurs
  • Insight needed to ensure that any weaknesses in a BCP can be recognized, adjusted, and controlled

Without a business continuity plan in place, you have far more to lose than to gain. Businesses that do not conduct risk assessments or plan for unanticipated events can close down easily. All your hard work could be lost if you do not make provisions for outages, disasters, fraud, theft, vandalism, and employee safety.

3 Disruptions in Business Continuity

Natural disasters, cybersecurity breaches, and financial depressions are all things that can interrupt business. How do you prepare for these events? How should you respond? The following information will elaborate on these three key business disruptions.

Natural disasters

To arm yourself against natural disasters, such as earthquakes, wildfires, floods, or wind storms, you need a disaster business continuity plan in place. Because natural disasters affect physical properties and assets, it helps to move your company’s files and operations to the cloud, or to a dedicated server in a remote location. Today, cloud storage replaces storing files onsite. This makes it much easier and more affordable to access information after a natural disaster. You can also use virtual services to regularly back up your company’s data for added security.

Using a dedicated server

A dedicated server will also protect your company’s records during a natural disaster. Include these details in your BCP. In this case, your disaster recovery plan should feature:

  • Who will be responsible for mitigating damages or recovering data
  • When backups will be performed
  • The methods that will be used to restore lost data. These methods should be thoroughly reviewed, particularly if you run multiple processes on one server
  • What method will be used to notify customers, vendors, and employees, if a system must be taken down? Contact information may need to be given to customers and vendors

The costs related to a natural disaster cover the cost per minute. Therefore, you need to be able to redeploy your data and access your computer server quickly after a natural disaster strikes. If you cover all your bases in a BCP, you will experience a reduced risk for downtime.

Cybersecurity breaches

To protect your customer information, you need to add software that will prevent hackers from stealing important customer data or profiles. Hackers can also wage cyber-attacks that can lead to business failure. It does not matter the size of the company, cybersecurity breaches can happen to anyone.

business continuity planning

In fact, data breaches don’t just hurt large businesses, they can impact small businesses as well. It only takes a few moments for a hacker to access delicate information and exploit it.

So, what should a business continuity plan include to prevent a breach of or attack on a company’s cybersecurity?

Methods that help reduce the risk of a cybersecurity breach

The following methods can help you reduce the risk and expense of a cybersecurity breach or attack, and will help support your efforts toward disaster recovery or handling a business disruption:

  • Install and regularly update anti-spyware and antivirus software
  • Train your staff on the basics of cybersecurity and storing billing information
  • Use a firewall for your web connection.
  • Regularly download and install software updates for your computer applications and operating systems
  • Routinely back up data and information
  • Control the physical access to your network and computer system
  • Make sure you secure and hide your Wi-Fi network, if applicable
  • Require individual computer accounts for each of your staff
  • Restrict your employees’ IT access and limit the authority for software installations
  • Change passwords regularly

Even after you take these measures, you may still experience a cybersecurity attack. However, the breach will be easier to track if you have more safeguards in place. These precautions are something you can measure in your continuity planning.

Financial Depression

Lockdowns, such as those related to the recent COVID-19 pandemic, can have devastating financial consequences for a business. For example, even if you manage to secure federal funding to keep going, you may end up having to close a location to keep another one open. This makes business continuity planning essential to any type of business recovery and risk assessment plan.

In the case of financial or economic depression, you need to think in terms of your customer base, the roles played by your staff, your cash flow, and financial outlay. Therefore, you should consult with your accountant before beginning this part of the planning process.

What you can do to prepare

Emphasizing the use of customer loyalty programs can get you through a financial depression within your company. It also helps to communicate clearly with employees and make sure all of you stay on the same page through a financial crisis.

You can also partner with other businesses to support each other until things start looking better financially. By taking this approach, you often can discover new opportunities for working with customers, suppliers, and other businesses. By establishing a business continuity plan, you can keep your business in the fold before, during, and after a financial depression.

The Key Elements of a Business Continuity Plan

what is a business continuity plan

To develop a business continuity plan, you have to include several key elements to address all aspects of a strategy and outline it properly. The key elements you will want to include in a BCP include your goals/objectives, disruption avoidance planning, a business impact analysis (BIA), and the identification of essential sectors. The following information details each of these segments. Additionally, there are many critical areas to consider for your business continuity plan worth checking out.

To minimize risk and prepare for the worst, make sure you account for each area of your business. Detail what needs to be done for each key area so you can immediately respond to a business interruption.

Goals/objectives

Your goals and objectives enable you to detail what you want to accomplish by creating a BCP. They also give your employees the information they need to implement the plan. The purpose behind these goals and objectives is to:

  • Guide your disaster recovery team during an emergency
  • Outline the roles of recovery personnel
  • Underscore current threats and risks
  • Review how certain disasters will be addressed
  • Measure the impact of certain disasters
  • Provide the proper protocols for recovery
  • Identify the location of critical assets and data
  • Prioritize communications during emergencies
  • Outline current preventative measures
  • Locate weaknesses and propose solutions

Consider your business continuity plan a continual work-in-progress that will need to be updated periodically. Updates become necessary as new threats emerge or risks develop from expanding and growing your company.

Disruption avoidance planning

When you run a business, you also increase the possibility that something will happen that, at the time, is beyond your control. Therefore, your BCP should also contain disruption avoidance planning: planning that handles risk in one of two ways–by accepting it or transferring it. Transferring risk involves the use of business interruption or liability insurance while acceptance means assuming the risk and the resulting costs.

In essence, disruption avoidance planning can be equated to protection and prevention planning for your business. If you operate a fairly large company, you will need to have a plan in place for various operational divisions, including your in-office operations, your supply chain and distribution area, and cyber-security and IT area.

Business impact analysis (BIA)

Business continuity planning also includes a business impact analysis or BIA. The analysis identifies specific business tasks known as critical business activities. In other words, these activities form the core basis for operations. The BIA also helps you identify:

  • The resources you need to support critical business activities
  • The resulting impacts when these activities stop
  • How long a business can survive without the critical activities in place

When developing a business impact analysis, you need to consider what, specifically, you need to use to support critical business activities. These items/resources may include:

  • Records and documents you need to operate
  • The equipment required to operate
  • The access required to enter your business premises
  • Your employees’ knowledge and skills
  • The external stakeholders whom you rely on or who rely on you
  • The legal obligations you need to meet

All the above-listed resources support critical business activities and can impact your business if you cannot use or deploy them.

Identifying essential sectors

Creating a business continuity plan also involves identifying essential sectors of your business operations. For example, let’s pretend that you own a saddlery company and sell saddles to retailers. In this scenario, the essential sectors in your business operations include the purchasing, production, and distribution channels. Therefore, you need to conduct a risk assessment for each sector and a plan for recovery.

That means you need to provide a timeframe for recovery for each of the above sectors as well. For instance, you might give the purchase of materials a 48-hour timeframe or the purchase of inventory one week for recovery. Manufacturing might take two weeks to implement and distribution could take the same length of time. By identifying essential sectors, you can assess each risk, plan for it, and meet your recovery goals and objectives.

Conclusion

Each business has different needs when it comes to assessing and reducing risk. Therefore, you cannot draft a business continuity plan from a template. The plan must be customized to address the critical activities of your business with respect to the prevention and the reduction of downtime. When you emphasize these areas, you can design a plan that will give you the resources needed to keep going even in the bleakest of times.



PaymentCloud Author Caroline McMullen

Caroline McMullen

Caroline is a writer and editor based in Los Angeles, CA. She has been working in the writing sphere for the last five years, covering everything from breaking news to lifestyle features, and now digital payments. Caroline is currently a Marketing Coordinator at PaymentCloud, a merchant services provider that offers hard-to-place solutions for business owners across the nation.