Current Business Continuity Management (BCM) focuses on reducing the impact of disruptive events on a business and ensuring business continuity. Although enterprises today are more equipped to manage their business during contingencies such as terror attacks, heavy rains, typhoons, tornados, heavy snowfall, earthquakes and other natural calamities, BCM practices remain predominantly reactive.
For a robust BCM, an enterprise must adopt more adaptive and proactive strategies to ensure its objectives are supported beyond business continuity. This would entail balancing the likelihood and consequences of a disruptive event and exploiting the opportunities that come with them.
Here are five essential practices that are key to evolving a BCM programme so that it is better equipped to help achieve your business objectives:
1. Visible top management commitment and involvement The Board, CEO and other top management officers must not only demonstrate commitment through policy, process, procedure adoption and resource allocation, but also get involved actively in giving directions and receiving status of near miss events and actual disruptions. Top management involvement in BCM activities post their sponsorship is important. You can do this by involving them in management reviews and reporting, ensuring alignment to strategic planning and business objectives, periodic risk assessment outcome reviews, directions and status reporting during disruptive events, frequent employee connects and more. Top management commitment and involvement structures have become complex over a period of time as they have to demonstrate the commitment and involvement even at the bottom most layer of its subsidiaries as well as the supply chain. Practicing visible management commitment and involvement at ground zero opens exponential opportunities which otherwise go unnoticed.
2. Integrate risk assessment and business impact determination exercises
Enterprises today perform multiple risk assessment and business impact determination exercises to meet their various needs in different focus areas. These are, however, performed in silos and merely talk to each other, often leading to overlaps, inconsistent methodology and inaccurate or inconsistent results at an enterprise level. Enterprises where Chief Risk Officers (CROs) go beyond the Enterprise Risk Management (ERM) and consider these silo exercises in their enterprise-wide risk posture determination, find their BCM risk assessment and business impact determination outputs influencing the enterprise strategies devised to achieve business objectives. Similarly, other risk assessment and business impact determination exercises can significantly help in formulating better BCM strategies creating opportunities. Therefore, it is important to integrate risk assessment and business impact determination exercises so that they contribute significantly to the enterprise’s business objective of providing products, services and sustainable operations.
3. Integrate resilience factor
BCM must include the resilience factor in its framework. It is the adaptive and proactive ability of an enterprise to perceive and capitalise on the opportunities that every event brings and embrace the changing environment. BCM must move from an event-focussed approach to an objective focussed, risk and reward approach. The focus should be on adaptive, proactive and reactive strategies that will enable the enterprise create value, sustainably operate and seek ways to gain a competitive edge in the market. If you decide not to reinvent the wheel, tailor the resilience standards to business processes and operations. Discourage changing the business to fit a standard’s requirement as standards exist to enable business and not to hinder the way you do business. The resilience factor is all about bringing in the agility and adaptive capacity into your enterprise’s capability to provide sustainable operations, products and services.
4. Supply chain and sub-contractor management
Supply chain and sub-contractor relationships must be taken more seriously. Conduct a thorough supply chain and sub-contractor mapping that brings out various dependencies and inter-dependencies. This will help you formulate strategies to manage supply chain and subcontractors to ensure the enterprise business objectives are met where they play critical roles. In addition, ensure effective engagement with internal suppliers, external suppliers, and sub-contractors at every stage of the relationship with continuous communication of expectations and the means to achieve them. In today’s collaborative world, managing these relationships, their performance and capabilities in a smart way can be a game changer.
5. Measure BCM capability and maturity
While establishing your BCM programme, formulate some measurement criteria to evaluate your BCM programme’s capability and maturity. This would give confidence and a sense of achievement to the top management and ground-level implementers alike. Initially, your measures could be in the form of Key Performance Indicators and internal audits, but in a long run, you should develop a measurement model using one or more process reference, process assessment, process capability, and/or organisational maturity models. These measurements can be introduced as a self-evaluation process to begin with and gradually to second-party and third-party assessment programme.
Evolving your BCM programme to integrate with your enterprise’s informed decision-making mechanism is imperative to your business operations. These five essential elements will ensure your BCM programme is robust enough to meet your business objectives of providing sustainable operations, products and services. It will also provide valuable inputs for an enterprise-wide integrated risk management strategy execution.
- By Rajeev Thykatt, Group Leader, Risk Management, Infosys BPO
The thoughts and opinions shared here are of the author.
Check out our end of season subscription discounts with a Moneycontrol pro subscription absolutely free. Use code EOSO2021. Click here for details.