There are many reasons why organisations embark on the business continuity management process. The more common reasons concern the protection of;
- Company assets including data and information
- Company revenue
- Company market share
- Stakeholder interests
- Statutory and regulatory changes
- Legal obligations to take precautionary measures
- Auditors and Insurance Company document requirements
In line with this, it has been estimated that the costs of a recovery from a disastrous event may be in the vicinity of 15 times greater than if a properly executed recovery plan existed. Research has also shown that an organisation stands to lose up to 60% of its productivity within a few days following a disaster, making it uncompetitive. To make matters worse, experience has shown that insurance usually covers only 30-50% of all losses in a disaster.
The advantages of having a documented and tested recovery plan in place are;
- A recovery will be quicker and more efficiently carried out
- An increased likelihood of business survival - It has been estimated that only 6% of organisations that do not have a plan and suffer a significant data loss will remain operational two years following the occurrence of the event
- An increased likelihood of meeting statutory and legal requirement
- A possible reduction in insurance premiums, particularly if an organisation can demonstrate to its insurers that it has undertaken sufficient measures to identify and mitigate risks. A documented and tested recovery plan is recognised as being part of the risk mitigation process
- An organisation may experience an improved credit rating
- May assist in securing business contracts with key customers i.e. by being able to prove to customers that an organisation will be able to continue operating or provide continuous supply of goods or services in the event of a crisis.