Failing to plan may be planning to fail
Bill May is head of risk management at Crisis Survivor Ltd and also is a member of the BIBA Property Insurance Committee
Historically, Facilities Managers will have been comfortable with the concept of Disaster Recovery Plans covering as they have done IT telephony and the built environment. The British Institute of Facilities Management (BIFM) has adopted the BSI ratified definition of Facilities Management as ‘the integration of processes within an organisation to maintain and develop the agreed services which support and improve the effectiveness of its primary activities’.
As can be seen, this definition encompasses a much wider remit than merely protecting the physical or digital environment within which an organisation operates extending as it does to the ‘processes’ and ‘services’.
Over a number of years, the concept of Disaster Recovery Planning has developed in itself a wider remit, and whilst still paying due attention to the basic concepts, now extends to address the survival of all aspects of a business in a much broader range of scenarios. This is Business Continuity Planning. Additionally, this wider remit has impacted upon the ownership of the process whereby in the past, a Disaster Recovery Plan has tended to be within the purview of the facilities management team whereas the business recovery plan has to be owned at board level if it is to be successful.
Until recently, the development of Business Continuity Planning has been somewhat hampered by the absence of a standard by which such plans could be benchmarked so as to ensure that best practice was being applied. With the publication in November 2007 of BSI 25999 part two, this hurdle has been finally cleared.
In addition to the natural pressures to provide a more holistic response to protect a business from the ever more complex risk exposures innate within today’s integrated and global business environment, there are also greater regulatory and legislative pressures driving the process e.g. although continuity planning is not specifically mentioned, the Companies Act 2006 imposes obligations on directors which will force them to ensure a BCP is in place for their company. Under the Act, directors may fail in their duty of care, if they do not take the right decisions to ensure ‘the success of their business’. In DTI ministerial statements this was defined as: “for commercial companies, ‘success’ will normally mean long term increase in value”. Clearly a business without a continuity plan is placing its long term success in jeopardy.
British Insurance Brokers Association (BIBA) commissioned research reveals that millions of SMEs across the UK are failing to protect themselves and their employees in the event of emergencies such as fire, flood, or acts of terrorism.
As a result, BIBA has launched a high profile campaign to encourage SMEs to get serious about Business Continuity Planning, a move backed by politicians of all parties.
Commercial insurers and underwriters are becoming increasingly aware that having a Business Continuity Plan is likely to reduce the severity of a business interruption claim and may even have a positive effect on Professional Indemnity and Directors’ & Officers’ insurance premiums.
