Business Continuity Management (BCM) aims to provide businesses with the systems to absorb and recover quickly to full productivity. BCM is a fairly recent term for a well-established management principle, but treats business recovery as a discipline with universal rules and guidelines. It stems from risk management and disaster recovery, which can be seen as components of the broader BCM process. In short, it aims to equip managers with the tools necessary to reduce the impact of a unexpected event, and hasten the resumption of normal business.
During recessions, even small events can push an unprepared firm into insolvency. Companies experiencing cash-flow problems during the lower end of the business cycle may miss crucial deadlines if their IT systems fail at a critical juncture. With ever tightening credit, even the smallest delay may leave a permanent impact.
With the roll out of BS 25999 in the UK, and ISO 22399 and ISO 31000 internationally has encouraged a wider take-up of BCM plans. This has provided plenty of consultancy work for BCM practitioners, but there is little evidence that this improved business performance.
A recent survey by Equifax found that the total number of British business failures in 2009 increased by 18% on 2008. However, the fourth quarter improved on the 2008 equivalent period. A spokesman states:
“Figures for the last quarter [in 2009] show a continuation of this trend with a 7.7 per cent year-on-year decrease. This has to be good news for the economy as a whole.”
It must be noted that the yearly figures for 2009 are worse than 2008, and the fourth quarter enjoyed the additional benefit of lower sales tax rates, the future for the UK economy remains uncertain.
In its 2009 survey of resilience in international business, iJET found that the vast majority of companies had BCM plans in places. The sampled plans addressed concerned: emergency response (85%), continuity (82%) and crisis management (81%).
Indeed, take-up of BCM principles has taken off on an international level. Recent studies into businesses in Australia and New Zealand found a very positive reception, with 75% of organizations possessing BCM plans and holding regular testing.
It is this final issuing of testing that is crucial to embed BCM into organisational culture. The Chartered Management Institute's Business Continuity Report 2009 found that most business do not test their plans regularly. The BCI recommends that plans are rehearsed four times a year - the reality is that only 11% of British firms do so. With a third of businesses not testing plans at all.
Frequency of testing BCM plans
The key to preventing an unexpected event tipping a business over the edge, is to have BCM practices embedded into corporate culture. A off-the shelf BCM plan, or one-stop report procured from a BCM consultant will not, in itself, increase recovery times. A plan, on its own, is likely to be filed and ignored by a complacent workforce.
Plans need to be rehearsed - even in times of economic urgency. With firms operating under hand-to-mouth business plans, resilience and preparedness are the key buzzwords. .
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