We live in an unpredictable world, where disruptions can impact an organisation at any moment. All organisations must be prepared to respond to an emergency, disaster or crisis and have pre-planned strategies in place that enable them to recover from the effects of such situations in as timely a manner as possible. In this article, Gallagher looks at how business continuity management can help in these uncertain times.
Business Continuity Management (BCM) helps increase organisational resilience by identifying priority activities, developing suitable strategies and solutions for continuity following disruption and allocating necessary resources to minimise the impact of disruption.
The outbreak of the global COVID-19 pandemic in late 2019 led to many organisations referring to their Business Continuity Plans (BCPs) for guidance. Many found that the analysis carried out to develop and document BCPs was extremely useful, even if specific continuity strategies for responding to a pandemic had not been considered.
Even organisations that have invested heavily in BCM need to ensure arrangements have been put in place for responding to a pandemic, in particular recognising that many restrictions on normal life could be imposed by local and national governments.
Business Continuity Lifecycle[i]
In order to develop BCM arrangements consistent with good practice, organisations should follow a standard process.
Policy and Programme Management
Analysis
Design
Implementation
Validation
Embedding
Particular key aspects of this process that require additional effort when planning for a potential pandemic are the analysis and design stages. The following ten-point plan should be incorporated into any previous BCM thinking[ii].
In developing strategies and solutions for handling a pandemic, most organisations have to use a combination of more traditional BCM arrangements including those developed for denial of access to facilities, unavailability of personnel, failure of or limitations on technology and failures in the supply chain. Particular points of note in the COVID-19 outbreak included:
The ways in which organisations have had to adapt due to COVID-19 have led to changes in the way they think about risk management in general, and BCM specifically. It is likely that the implications from this situation will lead to:
Ensuring an organisation is as resilient as possible, whilst understanding operational priorities in recovering from severe disruption, would have helped many businesses transition more effectively during the pandemic. Harnessing lessons learned from this situation, together with ensuring normal business risks are managed, means that business continuity is as important as ever.
The Major Risks Practice of Gallagher are Associate Partners at Airmic. For more information, please contact Mark Rubidge, Director at Major Risks Practice: Mark_Rubidge@ajg.com.
[i]Adapted from the Business Continuity Institute - Good Practice Guidelines
[ii] Adapted from Business Continuity Institute - Pandemic Resilience – A Continuity Perspective February 2020
Disclaimer
This note is not intended to give legal or financial advice, and, accordingly, it should not be relied upon for such. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. In preparing this note we have relied on information sourced from third parties and we make no claims as to the completeness or accuracy of the information contained herein. It reflects our understanding as at 16 June, but you will recognise that matters concerning COVID-19 are fast changing across the world. You should not act upon information in this note nor determine not to act, without first seeking specific legal and/or specialist advice. Our advice to our clients is as an insurance broker and is provided subject to specific terms and conditions, the terms of which take precedence over any representations in this document. No third party to whom this is passed can rely on it. We and our officers, employees or agents shall not be responsible for any loss whatsoever arising from the recipient’s reliance upon any information we provide herein and exclude liability for the content to fullest extent permitted by law. Should you require advice about your specific insurance arrangements or specific claim circumstances, please get in touch with your usual contact at Gallagher.
Arthur J. Gallagher Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered Office: Spectrum Building, 7th Floor, 55, Blythswood Street, Glasgow, G2 7AT. Registered in Scotland. Company Number: SC108909