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Business continuity management - Gareth jones BCI 2010 conference

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Presentation on the question BCM 'what to plan for'

Presentation on the question BCM 'what to plan for'

Published in: Business

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  • 1. Determining business continuity strategy –wide area eventsGareth Jones MSc MBCI4 November 2010
  • 2. Introduction Impact of ‘wide area’ events on the risk environment Implications for business continuity strategies Considerations – possible mitigations Conclusion © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 1 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 3. The SpectrumInterruption Material impact on survival ‘normal’ wide area and global events Interruptions international events Loss of IT  CIS  Iceland  Gulf oil  War Loss of people Wildfires Ash spill  Chile cloud  Flu Loss of access to site mine  Terrorism Pandemic Loss of disaster Mumbai warning telecommunications  Pakistan  National  ‘Jetstream floods strike ’storms Loss of utilities  Power  9/11  Bank failure collapse © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 2 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 4. ‘Normal’ interruptions Extreme weather e.g. flood/high winds  Loss of key skills Loss of IT  Employee health & safety incident Loss of people  Supply chain disruption Loss of access to site  Negative publicity/coverage Transport disruption  Loss of water/sewage Damage to corporate image reputation/  Customer health/product safety brand incident Loss of telecommunications  Pressure group protest School/childcare closures  Environmental incident Loss of electricity/gas  Industrial action  Terrorist damageSource: 2010 CMI annual BCM survey © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 3 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 5. ‘Normal’ interruption trends 2002 2010 Loss of key Extreme skills 2004-2009 weather Extreme weather e.g. flood/high winds Loss of IT Loss of IT Loss of people 70 2003 Loss of access to site Loss of people Transport disruption Damage to corporate image/ 60 reputation/brand Loss of telecommunications School/childcare closures 50 Loss of electricity/gas Loss of key skillsPercentage 40 Employee health & safety incident Supply chain disruption Negative publicity/ coverage 30 Loss of water/sewage Customer health/product safety incident 20 Pressure group protest Environmental incident Fire 10 Industrial action Terrorist damage 0 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: CMI annual BCM survey © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 4 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 6. The SpectrumInterruption Material impact on survival ‘normal’ wide area and global events Interruptions international events Loss of IT  CIS  Iceland  Gulf oil  War Loss of people Wildfires Ash spill  Chile cloud  Flu Loss of access to site mine  Terrorism Pandemic Loss of disaster Mumbai warning telecommunications  Pakistan  National  ‘Jetstream floods strike ’storms Loss of utilities  Power  9/11  Bank failure collapse © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 5 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 7. Global landscape Risks interconnection map (RIM) 2010 “what makes the world seem riskier today are the ways in which Iraq Israel – Palestine Iran interconnected risks can amplify Afghanistan instability aggregate effects and the speed at Nuclear proliferation Slowing Chinese economy (<6%) which risk can spread throughout International North Korea terrorism Major fall in the US$ the world, disrupt tightly coupled Transnational crime Asset price collapse systems, or become known Retrenchment from globalization (emerging) and corruption Global governance Retrenchment from globalization (developed) immediately to millions of people Burden of regulation Data fraud/loss gaps Underinvestment in Food price volatility or markets – almost Liability regimes Droughts and desertification infrastructure Water scarcity instantaneously via the internet CII breakdown NatCat: Earthquake Migration Biodiversity loss and broadcast media” Pandemics Extreme weather Chronic disease NatCat: Coastal flooding NatCat: Inland flooding Infectious disease Air pollution NatCat: Cyclone Nanoparticle toxicityLikelihood (%) Severity (Billion US$) 1 5 10 20 10 50 250 1000 Source: WEF Davos 2010 and GlobalKey: Economics, Geopolitics Environment Risks in the Business Society Technology Environment © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 6 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 8. InterconnectionIcelandic Ash Gulf oil rig disaster FL350/FL550SFC/FL200 FL200/FL350 Changed air freight environment  Changed industry environment Market forces applied  Interconnection to pension funds Effects varied  Changed regulatory environment – Medicines versus fashion deepwater drilling and safety  Changed communications environment Remote working arrangements  Transparency expectations © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 7 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 9. Implications for business continuity strategyQuestions for Head of BCM or Business Resilience: On the spectrum what level of challenge should we plan for? In wide area events will normal BCM arrangements be sufficient to cope with a changed risk environment? (e.g. will recovery strategies still be viable?) Will supply chains be interrupted by wide area events? What interconnections are we vulnerable to? How could our product/service demand change? What are the implications of recent crises on the crisis management capability? © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 8 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 10. Uncertainty reduction: scenario planning  Review scenarios  Review scenarios  Select focus  Define level of resilience required  Develop strategy against each scenario  Test each capability area to identify gaps in resilience  Develop strategy © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 9 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 11. 2012 UK – a wide area scenario?In addition to the normal risk landscape there will be: The Olympic Park VIPs and national interest events Competition venues outside of the Olympic Park – including test events Non-competition venues Training venues and camps Transport networks Olympic route network Unofficial Olympic related activity CyberspaceThe stated planning assumption is that there will be a clear focus on ensuring that theGames will go ahead in almost any circumstance (UK Olympic and Paralympic Safetyand Security Strategy) © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 10 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 12. 2012 risk landscape – considerations National economic climate Scope and scale – localised effects Focus of authorities and emergency services response Dread risks – high uncertainty Law of unintended consequences – sensitivity and false alarms/hoaxes Emerging risks – limitation of design under stress – particularly infrastructure People influenced by mood and events (the media?) – some events may demand a change to plan and posture Shareholders expectations – known risk © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 11 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 13. MitigationsPlan, monitor and prepare Understand the scale, scope and geography which could impact the environment in which the organisation operates Could use scenario planning and exercises to widen the view of interruptions Evaluate current capability Review requirement Define programme – prioritise – fix basics Enhance arrangements – reliability and capability © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 12 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 14. Conclusion Most organisations plan for ‘normal’ interruptions Planning for wide area events is often poor or non-existent Global interconnection is increasing Global communication is now very fast Greater challenge for those charged with BCM or Business ResilienceDue to level of uncertainty, scenario planning and exercises are highly recommended © 2010 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. This document is confidential and its circulation and use are restricted. 13 KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.
  • 15. Presenter’s contact details Gareth Jones KPMG LLP (UK) +44 (0)20 73116380 gareth.jones@kpmg.co.uk www.kpmg.co.ukThe information contained herein is of a general nature and is not intended to address thecircumstances of any particular individual or entity. Although we endeavour to provide accurate andtimely information, there can be no guarantee that such information is accurate as of the date it isreceived or that it will continue to be accurate in the future. No one should act on such informationwithout appropriate professional advice after a thorough examination of the particular situation.

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