Does your startup need a Business Continuity Plan?
Disasters strike, especially in volatile industries. In such a rapidly changing industry like IT, breakdowns are inevitable. All businesses, including startups, are susceptible to some level of risk. Therefore, you should always be prepared for a worst-case scenario. Startups are often on shaky ground so it’s worth investing in business resiliency and protection for your company. Creating a business continuity plan is one of the most crucial things if you want to be ready for just about any ‘what-if’ disaster. In this article, we’ll explain what a business continuity plan is and how to prepare it right.
What is a business continuity plan?
A business continuity plan is an internal guide, a document that helps businesses navigate emergencies. Startups often consider it as a kind of ‘case of emergency, break glass’ document. In the past, business continuity plans were reserved mostly for corporations but now, startups write them as well. A business continuity plan is a list of procedures to streamline business continuity. It doesn’t prevent disasters, but it definitely prevents extensive damage from them. It helps companies navigate emergencies and ensures that employees and assets are protected as much as possible in the event of a crisis. A business continuity plan covers everything from natural disasters to cybersecurity. It is worth mentioning that a business continuity plan is broader in scope than a disaster recovery plan. A disaster recovery plan is focused on restoring critical systems after a disaster (hardware, IT, assets, communication systems, etc.). In contrast, a successful business continuity plan isn’t just recovering the necessities but gathering all procedures and processes that allow a business to continue the business’s regular operations during and after a disaster. Experts keep saying that all companies need a BCP, regardless of the size and nature of their work.
The key elements of a business continuity plan
Most business continuity plans follow a relatively similar structure. There are a few important things to remember and include in your BCP:
· Potential risks and their business impact. Those are risks and vulnerabilities within and outside the business. The list of risks may include everything from flooding to failure by a supplier.
· A proper response – when we have risks and threats outlined, we also need an effective response strategy.
· Roles and responsibilities – everyone should know their roles and responsibilities in cases of a disaster.
· Communication is vital during any business disruptions. There should be a list of key contacts.
· Testing and exercising.
Why does a startup need a business continuity plan?
The COVID-19 pandemic showed that a good business continuity plan is a must, no matter the industry your company operates in. It helps companies to respond quickly when disruption strikes by minimizing the negative impact on business operations. One of the most important purposes of a BCP is to provide a stress-free working environment for the employee up. Another is assessing the weaknesses of the company in every aspect. Startups are surprisingly emergency-prone – even a seemingly minor emergency could set off a domino effect that takes your company under. Even if you were resilient to the COVID impact, you may not be as fortunate during the next crisis, whatever it may be. Therefore, startups need a BCP to highlight their business’ weaknesses and help in prioritizing the most crucial processes. A business continuity plan is necessary in the case of:
· Economic recession.
· Natural disasters.
· Sudden service shutdowns.
· Unexpected firings / walkouts.
Advantages of business continuity planning
An effective business continuity plan enables you to prepare in advance procedures to help you cope with the unexpected. These are the key benefits of BCP:
Disaster Recovery plays an important role in the BCP in the restoration of business operations. When you have a proper BCP, you can restart operations swiftly.
Organizational assurance – you know that during a crisis, everything is under control. You can comfort your employees and stakeholders, communicate with them timely, and maintain transparency with the actual situation.
Quality control – a BCP enables you to maintain quality while replacing the resources that are affected in the crisis by technology and alternative infrastructure.
Risk management – you can mitigate various types of risks and implement damage control initiatives. At the same time, you reduce risk and danger to your employees and customers.
Maintaining a proper brand reputation. Having a well-prepared business continuity plan is a way to build customer confidence and trust. Also, it helps you develop confidence within the business.
Compliance with industry standards, as well as regulatory or legal requirements.
You can optimize the cost of tackling business interruption. Operations are recovered cheaper and quicker.
In some cases, having a business continuity plan can even save lives if dangerous events occur.
Business continuity plan myths
There are so many misunderstandings and myths around BCP. Let’s dive deeper into the most common ones.
Myth 1: BCP is only for natural disaster recovery
It’s a very old-fashioned approach. Sure, disaster recovery is a component of a BCP, however, it includes other threats as well. One of them may be a cyberattack – did you know that almost 50% of all cyberattacks target small and medium companies?
Myth 2: Startups don’t need a BCP
It’s a very common misconception about BCP to recover critical business functions. Every business, no matter the size and the industry, needs a comprehensive and detailed business continuity plan.
Myth 3: The plan is all you need, no testing is required
Having a business continuity plan is not enough. It’s a great start, that’s true, but it’s only one part of the equation. Your plan should be regularly tested so that you can verify whether it actually works. Experts recommend testing a BCP at least twice per year.
Myth 4: a BCP doesn’t need any documentation
Very often, it is said that businesses operate without BCP documentation, even when it’s not easy to survive. However, from our experience, it looks different. Even if you made it through the crisis without having a written BCP, you still need it.
Myth 5: It’s easy to predict how long things will take
Business owners tend to believe they can forecast how much time they will need for various recovery phases. However, most people usually overestimate their skills and underestimate the time needed for the business to recover. People usually assume the best-case scenario and completely forget about the worst-case scenario business processes.
How to create your business continuity plan step by step
Ready to create a successful business continuity plan? Follow the steps below to create a perfect one:
Identify the goals and objectives of your BCP. Depending on the nature of your business function, the effectiveness of the BCP creates an immediate impact over a certain time later.
Assess the risks and business impact analysis. You should describe possible risks that come during emergencies. You can just list specific scenarios that can affect your organization. The more details, the better. Discuss how these situations can play out. Conduct a BIA (Business Impact Analysis) that analyzes the main operations of a company, the major resources it uses, and how its operations relate to one another.
Create guidelines for each business function. Think about the inventory and location of all resources (supplies, critical devices, data backups, etc.). Also, make a list of your key personnel involved to execute your comprehensive business continuity plan. For maintaining the core functions, you should include details such as key emergency staff, critical business functions, details of the action process, communication strategy, etc.
Assign the roles and responsibilities of your business continuity team. You should educate and train the teams so that they know how to act accordingly when the real thing happens.
Review the effectiveness of your BCP so that no mistakes are remaining when it comes to implementing the BCP during a crisis.
Test your business continuity plan. This is a necessary step if you want to make sure that all your proposed ideas work. You should rigorously test your plan by attempting to break it.
Update your business continuity plan as needed. Revise procedures, update all the plan copies, and redistribute them to the appropriate personnel.
As you can see, creating a business continuity management plan for your startup is not an easy task to do. Therefore, it’s often the best option to find a reliable software development company that will help you.
At Liki, we have helped many startups to develop and implement business continuity plans. We have an experienced team of business continuity planning process experts who will be happy to use our tools and practices so that you can be sure you are protected against disaster results. We’ll be happy to remove the burden of managing and testing your BCP and reducing business risks and test organization's risk management strategy. Reach out to us to get more information!