(20) Business Recovery, Continuity and Insight

I realize that at first glance the title of this issue risks categorizing its message as “outdated”, because the term business reslilience has replaced disaster recovery (DR) and business continuity (BC) in many discussions.

However, the title reflects the actual evolution that occured, as DR was aimed at recovery after the factBC aimed at continuing business critical functions during the difficulties, and business resilience aimed at creating an adaptable organization that can respond to any type of unplanned event—including enexpected major opportunities.

It was a valuable insight to realize that knowledge of the critical functions of the businesslearned through DR and BC work—especially its value-creating activities—could be used not only to safeguard the business but to advance it. That’s business resiliency.

Of course the mobility and ubiquity of business and personal communications and computing capabilities have a lot to do with enabling today’s businesses to be more nimble than they could have been in the past. It is now easier and far lest costly for businesses to become resilient.

Both the enabling technologies and the needed understanding of resiliency exist—and now in many cases it is the mindset of senior executives and managers that needs to be brought up to speed.

Needless Vulnerabilities

In 2003 I wrote an article titled “Homeland Security and Your Business” because most businesses did not realize that they were still at risk in the event other targets were attacked.

In that article I listed some situations to be considered:

  • Slowdowns and interruptions of supply side and delivery side services
  • Disruptions of normal external channels of communication
  • Loss of internal information/communication systems
  • Inability of personnel to report to work
  • Inability of customers to conduct business in the normal way
  • Near-term loss of electrical power (days to weeks)
  • Local civil unrest
  • Temporary closure of financial institutions
  • Increased opportunity for employee fraud and theft
  • Dealing with a completely unanticipated crisis

There are many more causes of the conditions listed above than terror incidents, especially with regard to supply and delivery chain interruptions. Many of the risks involved are not security risks but operational risks, such as having a critical dependency a sole source overseas supplier.

Now, with knowledge of business resiliency easily available, many businesses are not just needlessly vulnerable, they are needlessly holding themselves back from improved growth and profitability.

The Economic Crisis as an Unplanned Event

One of the benefits of sound planning and program development for security, disaster recovery, contingency, and crisis & emergency management is that the business gains tremendous insight into itself, and is much better able to respond to any unexpected change or event.

Indications are that the 2008 economic crisis is continuing into 2009 and 2010. Companies won’t be experiencing just a single impact, there will be a series of impacts, many of which won’t be specifically predicted. The economic crisis is much more than an unplanned event: it is a creator of unplanned events.

Some companies are locking themselves into non-resilient positions, by taking cost-cutting measures that reduce their sizes and budgets but don’t make them more agile. Operational risks—including security risks—are increasing. New threats are just over the horizon. Unknowinglythe responses of many businesses to the economic downturn are making their companies more vulnerable, not less.

Safeguarding Business Value and Opportunity

The smart move now is to update existing DR and BC planning and expand (if not there already) into the development of business resilience. For companies that don’t have such planning in place—it should be made a top business priority.

Amidst the turmoil there is good news for smart business leaders.

Business transformaton case studies show (see the book Lean Thinking: Banish Waste and Create Wealth in Your Organization) that it is easier to achieve business transformation in tough timesthan in good times. Managers and employees know that it is not “just another exercise”, but thatthe company’s future—as well as their individual jobs—may be on the line. And if you are already making changes, optimizing those changes for resiliency is just an incremental cost—with a huge return on investment.

More Resilient or Less?

If you have to make changes to your company or your business unit, you have a choice. You can make it more resilient, or less.

Which way makes the most sense to you?

Best regards,
Ray Bernard

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