Every (Ash) Cloud has a Silver Lining
Following the global disruption caused by the eruption of
Eyjafjallajoku in Iceland, and the resultant ash cloud, VEGA
business continuity management expert, Gary Clarke, outlines how a
robust and effective business continuity plan can help
organisations avoid the potentially major consequences of future
unpredicted events.
For those people living under a flight path, the recent six-day
ban on air travel had a definite upside to it. For everyone else,
the disruption caused to businesses can hardly be seen as good
news. People stuck in overseas airports, supplies held-up, and
meetings cancelled all have a negative effect on business
performance. But, what if your business could outperform the
competition in dealing with this problem (or any other major
incident for that matter)? If such an event costs you less than it
costs your competitors, or if you can provide a service when your
competitors cannot, then you have the competitive advantage. And
you can realise this competitive edge quite easily, if you know
how.
It is no surprise that nobody in the UK predicted this volcanic
ash cloud or its effect on air travel (the last big eruption at
Eyjafjallajoku in Iceland was nearly 200 years ago). However, what
we can predict is that something will happen every so often and it
will cause problems for businesses.
So, if this event took you by surprise, wouldn’t you like to be
better prepared for the next one? You need a way to protect your
business and you should aim to do this better, smarter, and faster
than the competition.
Fortunately, there is a well-established technique that
management can use to gain control of situations like this:
Business Continuity Management (BCM).
How can Business Continuity Management (BCM) help my
business?
BCM looks at events that can disrupt your business and makes
provisions for dealing with them, in advance. BCM practitioners
don’t often plan for volcanic activity (at least not in the UK),
but we can and do plan for generic interruptions to business
processes. In other words, rather than try to plan for a limitless
number of possible events, we look at the general impacts – such as
staff being unable to get to work – and plan how to respond to
them.
In this way, when the unforeseen strikes out of the blue, we
have a crucial head-start and can manage the situation from a
position of strength.
Organisations with the foresight to have Business Continuity
Management Systems (BCMS) in place will typically have the
following measures ready to deal with problems such as the
disruption of air travel:
- An incident management process – for rapid impact assessment
and decision-making as the situation evolves
- A communications process – to keep staff, customers and the
media informed, and prevent rumours from spreading
- A remote working infrastructure – so key staff who are stranded
overseas can still be productive
- A resilient supply-chain – so when critical air-freight
supplies are cut-off, you have alternative sources and workaround
procedures
- A staff assistance process – to locate and track employees
around the world and provide financial, logistical and technical
assistance
By making advance preparations for these activities, you can cut
down on the time, inconvenience and expense of dealing with the
next unforeseen incident.
Won’t an insurance policy be sufficient?
Some businesses use insurance as a substitute for having a BCMS,
which is no doubt appropriate in some cases; you pay a regular
premium up front, and when the unfortunate event happens, the
insurer pays out to reduce your losses. This can be a useful
tactic, but the fundamental flaw in comparing the two approaches is
amply illustrated by what has happened in the wake of the volcanic
ash cloud.
Insurance policies are fine for incidents that cause physical
damage to property. If your premises are buried under ash or ruined
by lava flows, you stand a good chance of receiving compensation.
Denial of Access insurance should also pay out if you can’t get
into the premises because of the eruption. But that’s not going to
apply to anyone in the UK. So, unless you’ve got specific insurance
for particular types of events such as transport delays, you’re not
going to see any return on the investment in insurance payments as
far as volcanic eruptions are concerned.
Even if you do get compensation for the direct losses, insurance
does little to protect your organisation’s reputation or your
relationship with your client base if you are not able to continue
delivering your critical services during the incident.
On the other hand, the benefits of BCM are pretty much
guaranteed, whatever the circumstances. If you spend the time and
the money drawing up contingency plans and installing, for example,
remote working technology, it is going to be indispensable at some
point in the future.
The last Eyjafjallajoku eruption rumbled on for more than two
years, so don’t count on it being any less this time. If you
weren’t prepared for it first time around, you’re not alone. You
can’t say the same thing about the next event, though, as we’ve all
seen what can and does happen from time to time. Smart businesses
will take this lesson onboard and take action now to limit the
damage in future. Others won’t, and will instead repeat the same
painful, reactive process next time. You have an open invitation to
outflank those competitors by acting now on Business Continuity
Management.
Contact VEGA for more information about
Business Continuity Planning and Management