HKPC Seminar Why Business Continuity(20100611)

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Introductory seminar on Business Continuity, organized by Disaster Recovery Institute International

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HKPC Seminar Why Business Continuity(20100611)

  1. 1. Why Business Continuity? Elvin Chan MBCP CPA CEng
  2. 2. Elvin Chan <ul><li>VP at Bank of America Merrill Lynch </li></ul><ul><li>Senior Consultant at Marsh Risk Consulting </li></ul><ul><li>Manager at PCCW </li></ul><ul><li>Master Business Continuity Professional (MBCP) </li></ul><ul><li>Certified Public Accountant (CPA) and Chartered Engineer (CEng) </li></ul>
  3. 3. Agenda <ul><li>Traditional Thinking – Drivers? </li></ul><ul><li>Cultural Perspectives in Asia </li></ul><ul><li>Form and Substance </li></ul><ul><li>The Only Question You Need to Ask Yourself </li></ul><ul><li>Practical Way to Develop Your BCP </li></ul>
  4. 4. Traditional Thinking – Drivers? <ul><li>Pressure From Audit Committees (Corporate Governance) </li></ul><ul><li>Pressure From Financial Institutions (Borrowing Covenant) </li></ul><ul><li>Pandemic Concern </li></ul><ul><li>New Threats & Risks Since 9/11 </li></ul><ul><li>Demands From Customers </li></ul><ul><li>Cost Of Insurance (Business Interruption insurance) </li></ul><ul><li>Perceived As Competitive Edge </li></ul><ul><li>Reliance On Third Parties (Supply Chain) </li></ul><ul><li>Increased Regulatory & Self-regulated Requirements </li></ul><ul><li>Corporate Social Responsibilities (CSR) </li></ul>
  5. 5. Cultural Perspectives in Asia <ul><li>Work hard, make money and expand </li></ul><ul><li>Everything that doesn’t make money is luxury unless required by law </li></ul><ul><li>Even required by law, tendency towards minimal compliance </li></ul>
  6. 6. Form and Substance <ul><li>Form: </li></ul><ul><ul><li>Professional Standards (e.g. DRII Professional Practices) </li></ul></ul><ul><ul><li>National Standards (e.g. HKMA Guidelines on BCP) </li></ul></ul><ul><ul><li>Industry Standards (e.g. DRJ/DRII Generally Accepted BC Practices) </li></ul></ul><ul><ul><li>International Standards (e.g. BS25999) </li></ul></ul><ul><li>Substance: What do you must do to have a functional plan? </li></ul>
  7. 7. Form and Substance Importance of Form:
  8. 8. Form and Substance Not suitable for every business (size and industry) Too complicated, a lot of effort to maintain Mere decoration, not functional Criticism on Focusing on Form:
  9. 9. Form and Substance
  10. 10. Form and Substance Not suitable for every business (size and industry) Too complicated, a lot of effort to maintain Mere decoration, not functional Criticism on Focusing on Substance:
  11. 11. The Only Question You Need to Ask Yourself <ul><li>Can your business survive in a crisis? </li></ul>LOSS OF …
  12. 12. Practical Way to Develop Your BCP
  13. 13. Practical Way to Develop Your BCP <ul><li>Understand yourselves </li></ul><ul><ul><li>Identify your critical activities and interdependencies, i.e. You can’t make money without them! </li></ul></ul><ul><ul><li>Assessing the risks to these activities – 5”M” (Man, Machine, Material, Methodology, Money) </li></ul></ul><ul><ul><li>Assessing the impacts: </li></ul></ul><ul><ul><ul><li>Determine the Worst Case Scenario – What if your existing controls over those risks fail? </li></ul></ul></ul>
  14. 14. Practical Way to Develop Your BCP <ul><li>Prepare yourselves </li></ul><ul><ul><li>Determine how long you can survive without these activities – Technical term: Recovery Time Objective (RTO) </li></ul></ul><ul><ul><li>Develop procedures to bring your critical activities online within RTO (sequence according to interdependencies) </li></ul></ul><ul><ul><li>Decide on additional risk management strategies: </li></ul></ul><ul><ul><ul><li>Control, Transfer? </li></ul></ul></ul>
  15. 15. Practical Way to Develop Your BCP <ul><li>Enable yourselves </li></ul><ul><ul><li>Enable yourselves to save the most important thing – LIVES, by emergency response plan (ERP) </li></ul></ul><ul><ul><li>Enable yourselves to recover in a coordinated manner </li></ul></ul><ul><ul><li>ERP should at least include: </li></ul></ul><ul><ul><ul><li>A message cascading mechanism (call tree) </li></ul></ul></ul><ul><ul><ul><li>Procedures for evacuation and personnel accounting </li></ul></ul></ul><ul><ul><ul><li>Up-to-date contact list </li></ul></ul></ul><ul><ul><ul><li>Crisis command protocol </li></ul></ul></ul>
  16. 16. Practical Way to Develop Your BCP <ul><li>Test yourselves </li></ul><ul><ul><li>Starting from the easiest and simplest procedures </li></ul></ul><ul><ul><ul><li>Fire drill, Call Tree test </li></ul></ul></ul><ul><ul><li>Starting from the simplest test format </li></ul></ul><ul><ul><ul><li>Desktop test, Individual Function test </li></ul></ul></ul><ul><ul><li>With more experience and awareness, end up with an integrated test </li></ul></ul>
  17. 17. Practical Way to Develop Your BCP Without any plan
  18. 18. Ending… <ul><li>Both form and substance are critical success factors of a BCM program </li></ul><ul><li>Given Asian business culture, progressive approach may be preferred </li></ul><ul><li>Always ask yourselves a question: Will my business survive in a crisis? </li></ul>

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