Few of us are rich enough or poor enough to avoid the effects of the economic recession. It has affected public sector, commercial sector, charity sector and consumers. Behaviour, strategy, structures and most notable budgets have all been influenced by the downturn. As business continuity practitioners can we use our influence to improve the situation by adding value or are we subject to cuts as a discretionary spend?
At the BCI Symposium 2008 in Brighton there was a groundswell of opinion that the tools and techniques for crisis (incident) management were used for organisational crises during the credit crunch. In particular financial services had drawn on their business continuity manager’s expertise and indeed activated the relevant response teams. This was not for operational risk purposes; no fire, flood or bomb required to attack any retail bank or mortgage lender. It was to protect the brand in financial crisis (note the BCI definition of BCM - value creating activities and reputation etc).
On the other hand much discussion on websites and forums has related to business continuity being perceived only as a cost and of limited value. The cancellation of BC Expo, several conferences and events it is argued is an example of BCM being a luxury item and one of the first budgets to be reviewed if not reduced.
At the BCI North West Forum in February many of these issues came to light. Much of this article owes its substance to the honest and passionate members there. I have used anonymity to protect the innocent but every point was substantiated with one exception; Mel Gosling on his crusade regarding the legendary and unsubstantiated “80% of business fail within 18 months of a disaster”. I would like to thank Bernie Budworth QVC host and Helen Morris Marsh for their organisational skills.
BCM IssuesLooking at the effects in BCM we have seen redundancies in large and small organisations. Internal BC managers and external facing BCM consultants have equally been offloaded. We have seen dedicated work area recovery seats in DR centres being converted to syndicated and renegotiation of syndicated seats and DR contracts to ensure a cheaper deal for the client and retain their business from the vendor. In some cases DR has been brought in-house to reduce costs and indeed in many cases DR has been outsourced to reduce costs!
Training budgets have been cut; there are examples of training, travel and personal development being prohibited due to cost. BCM capability is being dictated by finance not business policy, regulation or operational need. Reciprocal arrangements that are free are seen as an alternative to professional 3rd parties. BCM exercises and meetings perceived as non critical are postponed. Un-motivated and fearful staff have no interest in BCM, they only care about job security (an interesting dichotomy).
Optimisation from Both Sides of the ArgumentThe effect on risk perception is interesting. On one hand corners are being cut, chances being taken and risks accepted to avoid costs such as insurance, reserves and alternatives. On the other hand this kind of exposure is a case for improved BCM capability. Businesses are going out of business at an alarming rate often regardless of risk appetite or BCM capability. On the other hand we have seen increasingly supply chain behaviour changing where more often than not a contractual obligation requires BCM. Requests and questionnaires ask for evidence of BCM capability and insist on BCM from inception. BS25999 has attracted more interest and downloads than any other standard. The BCI membership is growing.
Historically every major event has heralded in the BCM trade press a new era for BCM. Do you remember Y2K? That was advertised as a BC practitioner’s ticket to executive support, budgets galore and promotion to dizzy heights. Did Y2K deliver? In short no. Neither did 911, 7/7, Combined Code of Corporate Governance, Tsunami, Foot and Mouth, Civil Contingencies Act, Pandemic, BS25999… or any other single peril event, legislation or standard. Credit crunch will, as usual be perceived as the be all and end all and in hindsight we will wonder what all the fuss was about in BCM terms (those of us who still have houses and jobs).
Consequences of the Recession are ClearThere are serious consequences of the recession. Without a shadow of a doubt unemployment will increase and the effect on society is that theft and cyber crime will increase. One would imagine that could be a business case for BCM integrating with physical and information security. Suppliers will have to be more competitive and BCM could easily be the unique selling point (USP) that wins the edge to land new business.
Another value add for BCM. Single points of failure will result from downsizing as will the “sweating” of existing resources and increased risks of putting all your eggs in one basket. All good motivation for BCM.
We practitioners are often our own worst enemy. Given those all important 2 minutes in the lift alone with the CXO level what do we say? Bend their ear about business impact analysis or scenarios for rehearsals or confuse them with our dodgy language – BCMS, BCP, IMT, RTO, MTPoD, ITDR, BS25777 Information Communications and Technology Service Continuity at your peril. The CXO is in survival mode and we need to speak their language to inspire their confidence.
There is no good reason why BCM costs thousands and takes ages. There is too much talk and not enough action. Smoke and mirrors on BIA means we never understand what BIA is let alone understand our business (Note BS25999). Evacuation is the only process we agree on and even then, most organisations do them incoherently. Evacuation should not even be in a BC Plan but then again, many BC practitioners can never agree what should be.
Top Ten Ways of BCM Beating the Crunch
1. KISS Keep it simple stupidCut through the bureaucracy, confusing language and TLAs (Three letter abbreviations). Tell the CXO what you have to offer, give them solutions not problems.
2. Promote BCM as a revenue generationThink of ways to increase revenue such as through sales as a USP or that you would add BCM as a professional service you could sell for a fee to your customers (even in a local authority advice and assistance would take on a whole new meaning).
3. Promote BCM as a cost saving.Use the BIA to support multi-skilling, reduce overheads, utilise existing reserves and alternatives even business process re-engineering.
4. Use your privileged position.Out of everyone in your organisation you really have the unique and influential understanding of what really makes the organisation tick. (Note BS25999 Understanding your organisation!) Use this proactively to come up with ideas and business cases.
5. Stop whingingOne of the main complaints from BCMers we never get executive board support. Now is not the time for “pester power”. BCM needs to been seen as a useful resource not a drag.
6. Coordinate and integrate.Set up meetings with sales, production, PR, functional departments, health and safety, security, information security, IT, facilities, HR, risk management, legal, environmental. United we stand divided we fall. Bring everyone in and lead them to business continuity in its most literal sense – organisational survival.
7. Supply chain representationShow value creation in the supply chain. Don’t write a questionnaire on BCM and threaten a supplier with legal action or external audit. Go and visit them, show them what your priorities are and discuss how they can service them in comparison with their priorities especially in a disruption.
8. NetworkProvide intelligence on the market. What are your competitors doing? Who is doing what regarding BCM? What is the regulators position on BCM? Who had a near miss or disaster and how can we protect ourselves from it?
9. Be proactiveDo the things you might be asked for in advance, i.e. before you are asked. Think about your boss’s boss, what issues are they facing and how can you help at a more strategic level. Revisit the vision and values and see how intent can be delivered by BCM.
10. Analysis paralysisIn the golden hour of crisis management we urge rapid decision making to move at the speed of the crisis not the speed of the organisation (Credit as ever to Peter Power). It is better to do something now than wait and do nothing.
BCM for Darwinians – Survival of the fittestThere are many techniques for dealing with the credit crunch, some are even prescribed or regulated such as capital adequacy, insurance, increase revenue, cut costs even bankruptcy. BCM will survive after all what doesn’t kill us makes us stronger.
Will the recession alter BCM either positively or negatively forever? I don’t think so, events never have before; we just hope they might, and get ourselves all animated because of the press coverage.
But can we make a difference to the challenges our organisations face today? Of course we can. We must, survival depends on it. We need to demonstrate competency in our organisations. We must be clear and concise. We must show samples and examples of what BCM is, to point to a destination of where we are trying to get to, before we start the journey.
But saying, “I told you so” is not helpful. Those of us who don’t make a difference are likely to be perceived as part of the problem and will become casualties. How many times have we picked up a BC Plan from years ago – Started but never finished. No executive support by policy or ownership. Poor quality. Done in isolation. Never rehearsed.
These are tough times. So gird your BCM loins, take a deep breath, and think about what you need to do to make that difference… AND GO AND DO IT.
"SAVE MONEY" top 10 tips
1. Training can be expensive. Utilise the BCI network of experts, forums and mentors. Ask any questions you like, the answers are free. Be careful about confidentiality and compare a number of opinions before you customise them for your own organisation. Exercise some caution, you can get theory which doesn't work in practice.
2. Hotlines are an excellent means to communicate to many in a crisis. If you are on a budget buy a pay as you go sim card, record your message on voicemail then switch the phone off - hey presto a staff information hotline on the cheap.
3. Use software to mechanise reports, maintenance prompts and questionnaires to save time but beware of the costs, implementation for data hungry applications and the hidden costs of training time.
4. Do you need to buy or just hire? If it is a resource you might only need occasionally a hire contract or even a share with another owner might be possible. If you have the resource already, think of hiring it out to generate revenue and reduce the running costs.
5. DR WAR options consider dedicated, syndicated and in-house options. If you are in the public sector check out Community Resilience who will provide accommodation for free anywhere in the UK. 6. Second Hand is invariably cheaper than brand new. These are tough times and forms are selling off all sorts of equipment that can reduce you budget if second hand is acceptable. If in doubt take it for a test before committing to the purchase.
7. Gather your own neighbourly syndicate together and share the purchase of local products and services. All of your neighbours may be submitting a business case for standby generators which will be refused but sharing the cost of hired generator may be cost effective.
8. Shop around and negotiate. Get a feel for the values at stake and market pricing. Watch out for bidding wars between vendors and if it sounds too good to be true it probably is.
9. Reciprocal deals are free and can work. Carefully select your potential partner, make sure you have equality in need and offer, get the agreement in writing to avoid misunderstandings later. Rehearse the arrangement.
10. Early adopters, reference sites for new products, customer testimonials all have a value to your vendor and so you may be able to convert that value for them to a discount for you.
Andy Tomkinson MBCI
Partner Adtapt
+44 (0) 1253 788181
Adtapt - www.adtapt.com
Battle Box - www.battlebox.biz
This article appeared in the March/April Edition of "Continuity Magazine" - www.thebci.org
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