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  • By a quick show of hands how many people in the room are involved in some way in their organizations'’ BCP, DR or crisis management programs. Interesting and good to see What I would like to share with you today is a look at the operational and strategic value of business continuity and overall business resiliency and some steps that can be taken to achieve this. What we have seen in our work in a number of different sectors is that there is a wide disparity in the overall quality and effectiveness business resiliency programs. Most importantly we have seen programs that have good tactical and technical processes and elements in place but the program stalls, does not get the full support it demands, or is out os synch with what is important to the business. Focused in survival when that is not enough. It is better if our programs, and the processes followed to build and manage a business continuity program, are leveraged and designed to add value to the business.
  • Every five years, 20% of companies suffer a major disruption and, among those companies without business continuity plans, about 43% shut their doors within two years of the event. Research conducted by Oxford University showed that companies with effective management response to a crisis event gained an average of 7% in stock value over the succeeding months, while less effective company responses precipitated an average of 15% loss in net value.
  • Some relevant information about business continuity with the interesting fact being, when you stand back and look at it, these are all strategic business issues Capability Risk mitigation Integrated people process and technology Customer service Competitive advantage. All leading to the value proposition of business continuity (next slide)
  • These value proposition items are what can get lost at times if a business continuity program is focused only or survival and and getting through the big outages, the hurricane katrina type scenario The challenge is often, “how do we get to this point” how do we do it? How can I bring to the forefront this value proposition and make sure that our programs are relevant and effective.
  • This has not been the first crisis, nor will this be the last. The only difference is the threats have changed. So how have successfully organization naviatated themselve through a crisis. THE FIRST STEP HAS BEEN TO STEP BACK AND RELOOK AT THEIR BUSINESS BY: IDENTIFYING WHAT IS CRITICAL (FROM PEOPLE, PROCESS AND TECHNOLOGY) TRULY UNDERSTANDING THE THREAT THAT COULD OR IS HARMING OUR OPERATIONAL AND STRATEGIC OPJECTIVES, AND HOW VULVERABLE WE ARE TO THE THREAT. MOST COMPANIES PERFORM BUSINESS IMPACT ANALYASIS FOR THEIR TACTICAL THREATS SUCH AS NATURAL DISATERS, TECHNOLOGICAL FAILURE, OR EVEN TERRORISM… SO WHY NOT FOR OPERATIONAL THREATS CAUSED BY THIS ECONOMIC DOWNTURN. Next slide
  • This has not been the first crisis, nor will this be the last. The only difference is the threats have changed. So how have successfully organization naviatated themselve through a crisis. THE FIRST STEP HAS BEEN TO STEP BACK AND RELOOK AT THEIR BUSINESS BY: IDENTIFYING WHAT IS CRITICAL (FROM PEOPLE, PROCESS AND TECHNOLOGY) TRULY UNDERSTANDING THE THREAT THAT COULD OR IS HARMING OUR OPERATIONAL AND STRATEGIC OPJECTIVES, AND HOW VULVERABLE WE ARE TO THE THREAT. MOST COMPANIES PERFORM BUSINESS IMPACT ANALYASIS FOR THEIR TACTICAL THREATS SUCH AS NATURAL DISATERS, TECHNOLOGICAL FAILURE, OR EVEN TERRORISM… SO WHY NOT FOR OPERATIONAL THREATS CAUSED BY THIS ECONOMIC DOWNTURN. Next slide
  • OTHER TASKS YOUR ORGANIZATION NEEDS TO BE PERFORMING INCLUDI: COORDINATED ACTION PLANNING SCENARIO TESTING And EMPLOYING “AN ALL HAZARDS” RESPONSE PROGRAM FOCUSED ON RESILIENCY.
  • WHAT WE ARE TALKING ABOUT HERE IS BUSINESS RESILIENCE. RESPONSE MUST NOT ONLY BE TACTICAL AND SHORT TERM. WE MUST ALSO ENGAGE IN AN OPERATIONAL AND STRATEGIC RESPONSE AS WELL.
  • Strong companies won’t sit back and wait for the storm to pass. The winners will be those who act decisively, take tough decisions and position themselves to take advantage of the upturn when it comes.  Most of you are probably implementing these tactical solutions, if not, then you should” Perform a Business Impact Analysis to identify critical people, processes and assets Conduct a threat and vulnerability risk assessment to determine the real and current risks to the organization Understand your business – what do you do best and why, what are the threat, vulnerabilities and risks – how is it being impacted by the downturn Don’t be afraid to make tough decisions – focus on the key drivers of value and key risks across the organization and act decisively. Understand Your Response under different scenarios – test various scenarios from a financial, operations and workforce perspective to improve agility and the ability to adapt to changing conditions. Protect your people – keeps communication channels open, identify critical people associated with critical processes; and ensure they are retained and motivated.
  • In recent years inefficiencies have been tolerated and unnecessary complexities have been built into the way organisations conduct business. For some, the competitive landscape has changed so fundamentally that the previous business model will no longer be appropriate and significant change is required. Operationally organizations should: Protect your Liquidity – make sure your finances and working capital are in good order. Adopt a hands on approach to cash management. Streamline processes – Identify value-added processes and streamlining processes and costs. implement targeted cost reduction strategies Knowledge is power – Effective crisis management requires “good” information; clearly defined KPIs, and the capability to make decisions quickly Protect your Suppliers - Understand the changing needs of your suppliers; and determine which ones are critical Finally, As businesses are affected by greater turbulence in the marketplace management teams have an ever greater need for reliable information in order to make timely decisions. However, too often, companies use the same reporting templates and key performance indicators (KPIs) regardless of changes occurring in the external environment which affect their business models– the ‘we have always done it this way’ syndrome.
  • In a downturn, businesses must ensure their customers remain their number one priority. Those that support their customers through these difficult times will gain respect and benefit from mutual advantages. This is a good time for businesses to consider which of its customers, products and channels are the most profitable. To be successful, businesses need to focus on what really matters and not on customers who may be gone tomorrow. This is also a good time for businesses to consider the investments they are making – are there projects that could be deferred until the economic landscape becomes clearer? Therefore from a strategic perspective: Understand your business – what do you do best and why, Focus on Value Creation – Determine what is important and which products, customers and channels create or destroy value. Determine what initiatives you could stop or defer Protect your customers - Understand the changing needs of your customers and determine which ones are critical Protect your brand – seek out opportunities and continue to invest in innovation
  • To be effective, there are key lessons to incorporate into a Business Resilience Model (i.e. A Crisis management based risk management program) Strong “tone at the top” and sponsorship needs to be in place Requires a well articulated communication and implementation plan Critical to the success of the adoption of a Business Resilience approach is the support of the business units at both the management and staff level Realize self-assessment is a on-going process, not a one-time event or a panacea People in the businesses will need to understand “what’s in it for me?” and be motivated to adopt self-assessment Active participation will be required by all levels including senior management and support provided by designated champions in each key business unit Recognize that other organizations are leading the way, therefore, key learning from early implementers can be leveraged to facilitate progress
  • Understand your business – what do you do best and why, what are the threat, vulnerabilities and risks – how is it being impacted by the downturn Don’t be afraid to make tough decisions – focus on the key drivers of value and key risks across the organization and act decisively. Protect your Liquidity – make sure your finances and working capital are in good order. Adopt a hands on approach to cash management. Focus on Value Creation – Determine what is important and which products, customers and channels create or destroy value. Determine what initiatives you could stop or defer Streamline processes – implement targeted cost reduction strategies Knowledge is power – Effective crisis management requires “good” information; clearly defined KPIs, and the capability to make decisions quickly Understand Your Response under different scenarios – test various scenarios from a financial, operations and workforce perspective to improve agility and the ability to adapt to changing conditions. Protect your people – keeps communication channels open, identify critical people associated with critical processes; and ensure they are retained and motivated. Protect your customers and Suppliers - Understand the changing needs of your customers as well as your suppliers; and determine which ones are critical Protect your brand – seek out opportunities and continue to invest in innovation
  • Transcript

    • 1. Business Continuity in Challenging Times: Integrating Resiliency as a Strategic Priority
    • 2. Presentation Aim
      • To outline the operational and strategic value of business continuity, and how it can be achieved.
    • 3. Outline
      • Background and Requirements
      • Value of Business Continuity
      • Integrated Program Structures
      • How to make your program succeed at the Tactical, Operational, and Strategic levels
    • 4.
      • Background and Requirements
    • 5. Business Interruptions are Common Blackout 2003 Workplace Violence System Meltdown Labour Disruption Sabotage Pandemic Border Shutdown
    • 6. Cost of Not Preparing
      • Financial losses
      • Business interruption
      • Loss of key client/key supplier
      • Loss of reputation
      • Legal liabilities
      • Injury to people
      • Environmental damage
      • Regulatory scrutiny
      • Loss of customer service
      • Going out of business
      Blackout 2003 Labour Disruption Pandemic Border Shutdown Blackout 2003 Workplace Violence System Meltdown Labour Disruption Sabotage Pandemic Border Shutdown
    • 7. What Does Management Need?
      • Minimize negative surprise
      • Resolve uncertainty and variances from expectations
      • Process to identify opportunities
      • Maximize opportunity for success and good performance
      • Employ the entire organization in the business resilience process
      • Alignment of organizational objectives
      • Efficient communication process
      • Ability to enhance stakeholder confidence in management of their plans
      13
    • 8.
      • Value of Business Continuity
    • 9.
      • Business continuity is about capability to prevent disruption and mitigate risks associated with failure to meet objectives
      • can mitigate significant operational risk
      • encompasses people, processes, and technology
      • is required for any organization offering continuous or a high level of customer service
      • is about maintaining a competitive advantage before, during, and after a major event
      What is Business Continuity? Note : These are strategic business issues
    • 10.
      • Minimize financial losses
      • Protect personnel
      • Protect assets
      • Protect and improve reputation
      • Enhanced customer service
      • Ensure high quality and efficient processes
      • Maintain stakeholder obligations
      Business Continuity: Value Proposition
    • 11.
      • Integrated Program Structures
    • 12.
        • Multiple silos across the organization
        • Disjointed and sometimes ineffective programs
        • Gaps between corporate goals and programs
        • Limited manageability and accountability
        • Often focus on compliance vs. competitive advantage
        • Need for better customer service
        • Business Continuity is not adequately leveraged into the strategic planning process
      Need for Integrated Programs 4
    • 13. Integrated Enterprise Risk Programs
    • 14. Integrated Business Continuity Functions The Goal is Business Resilience
    • 15. Integrated Business Resilience: Plans and Programs Integrated Program Pre - EVENT Integrated Program Pre-Event Post-Event Business Continuity Planning Crisis Management Disaster Recovery Business Continuity Business Continuity Planning Crisis Management Disaster Recovery Business Continuity Crisis Management Emergency Response Communication & Coordination Interim Business Process Crisis Management Emergency Response Communication & Coordination Interim Business Process Business Continuity People Location & Resources Procedures Business Continuity People Location & Resources Procedures Disaster Recovery Applications Technical Infrastructure Data Recovery Disaster Recovery Applications Technical Infrastructure Data Recovery EVENT Enterprise Risk Management Enterprise Risk Management RM Optimization Risk Assessment Risk Response Risk Monitoring RM Optimization Risk Assessment Risk Response Risk Monitoring Business Continuity Planning Crisis Management Disaster Recovery Business Continuity Crisis Management Emergency Response Communication & Coordination Interim Business Process Business Continuity People Location & Resources Procedures Disaster Recovery Applications Technical Infrastructure Data Recovery Enterprise Risk Management RM Optimization Risk Assessment Risk Response Risk Monitoring RM Optimization Risk Assessment Risk Response Risk Monitoring
    • 16.
      • Success at the Tactical, Operational, and Strategic Levels
    • 17. Elements of the Program Response & Recovery Program Maintenance Benchmarking Elements of an Effective Business Continuity Program Recovery Plan Testing Strategy Planning Training Program Implementation Plan Development Threat, Vulnerability, Risk Assessment Business Impact Analysis
    • 18. Areas of Focus
      • An effective continuity program begins with understanding the business
      Response & Recovery Program Maintenance Benchmarking Elements of an Effective Business Continuity Program Recovery Plan Testing Strategy Planning Training Program Implementation Plan Development Threat, Vulnerability, Risk Assessment Business Impact Analysis
    • 19.
      • … achieves resiliency through:
      • Dynamic Planning
      • Response and Recovery
      • Focus on People
      • Value Creation
      • Communication
      Areas of Focus Response & Recovery Program Maintenance Benchmarking Elements of an Effective Business Continuity Program Recovery Strategy Planning Training Program Implementation Plan Development Threat, Vulnerability, Risk Assessment Business Impact Analysis Scenario Testing
    • 20. Building the Program We must consider a business resilience program based on business response and business recovery OPERATIONAL STRATEGIC TACTICAL
    • 21. Building the Program We must consider business response and business recovery Immediate internal emergency response plans Business Response STRATEGIC TACTICAL OPERATIONAL STRATEGIC TACTICAL
    • 22. Building the Program We must consider business response and business recovery Immediate internal emergency response plans External customer-focused response/recovery plans Business Response Business Recovery OPERATIONAL STRATEGIC TACTICAL
    • 23. Building the Program Immediate internal crisis response plans External customer-focused response/recovery plans Risk plans linked to Strategy and Performance Management Business Resilience Business Response Business Recovery OPERATIONAL We must consider business response and business recovery OPERATIONAL STRATEGIC TACTICAL
    • 24. What You Can Do
      • Plans should be aligned with your strategy
      • Identify critical people, processes & assets (BIA)
      • Identify threats, understand vulnerabilities & assess risks
      • Incident Response
      • Act Decisively
      • Employee assistance programs
      • Scenario Testing
      Tactical Planning Considerations: Tactical plans (response plans) “keep your house in order” OPERATIONAL STRATEGIC TACTICAL
    • 25. What You Can Do
      • Protect your liquidity
      • Identify critical suppliers
      • Vendor and sourcing alternatives
      • Streamlining processes for minimum disruption
      • Reliable communication channels
      Operational Planning Considerations: Operational Plans (recovery plans) help to keep your business in order and your clients satisfied OPERATIONAL STRATEGIC TACTICAL
    • 26.
      • Leverage your gains before the crisis worsens
      What You Can Do
      • Understand changing customer requirements
      • Review key business objectives to ensure relevancy
      • Focus on value-creation & Innovation – customers, products, services
      • Project volumes and set priorities
      • Protect your brand
      Strategic Planning Considerations: Business Resilience transforms a “crisis” into a competitive advantage OPERATIONAL STRATEGIC TACTICAL
    • 27. Keys to Successful Program Implementation
      • Strong “tone at the top” and sponsorship needs to be in place
      • Self-assessment is a ongoing process, not a one-time event or a panacea
      • People in the businesses will need to understand “what’s in it for me?” and be motivated to adopt self-assessment
      • Active participation will be required by all levels including senior management and support provided by designated champions in each key business unit
      • Recognize that other organizations are leading the way, therefore, key learning from early implementers can be leveraged to facilitate progress
    • 28. Why Leverage Business Continuity Principles to Manage Risk?
      • Early Warning Systems
      • Systematically identify, assess, and prioritize issues associated with driving forces
      • Avoid unwanted risks and protect assets in place
      • Reduce chance of repeat problems
      • Identify value within the organization
      • Operational Resilience
      • Prevent and rapidly respond to potential catastrophic failures
      • Secure and protect people, processes, and assets
      • Align goals with vendor requirements
      • Enhance Organizational Value
      • Ensure threats are understood and impacts of a disaster mitigated
      • Maintain public confidence by demonstrating service resiliency
      • Accelerate ability to respond to change and capitalize upon opportunities
      No Big Surprises No Big Mistakes No Big Missed Opportunities
    • 29. Thanks – Now we can eat!
    • 30. Thank you. “ When the tide goes out, we find out who’s been swimming without a bathing suit” – Warren Buffett, July ‘07 Cliff Trollope 416-515-3851 [email_address]

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