Helping business continuity survive and thrive in today’s new economic reality

It’s been called the worst econimic downturn since the Great Depression. Stock markets tumbled, auto industry giants collapsed and unemployed rates climbed steadily all over the world. It also became a new and unprecedented challenge for business continuity professionals unlike any most had seen before: how to ensure the continued success of business continuity and disaster recovery in the face of an economic meltdown.

Despite the wayward economy, some industries have been harder hit than others. There are people in the BC field who report they haven’t felt the effects of the downturn much at all.

“The downturn has affected us minimally,” says Christopher J. Servia, CBCP, disaster recovery coordinator for University Health Systems of Eastern Carolina and a member of the Disaster Resource GUIDE editorial task force. “In healthcare, it is generally noted that people still get sick no matter what the economic climate. We continue growth in our industry including expansion of our Children’s Hospital and some other services.”

But many more say they have been hit hard by the downturn, faced with budget cuts, program reductions and even job losses. Part of the problem is that too many executives see BC as a “nice to have” rather than a core business function.

“We believe BC is important, but unfortunately, a lot of executives don’t,” says Edward (Ted) B. Brown III, CBCP, president and CEO of KETCHConsulting. “They say, ‘why am I spending money on something that will probably never happen?’ I’ve been in this industry for 20 years, and it’s always a challenge. But in a slowed economy, it’s even worse.”

Brown argues, however, that the tight economy makes BC even more important than ever. “It’s not as critical, it’s even more critical,” he says. Take, for example, the supply chain. Your business partners also need to cut costs, and that could have a drastic effect on your own business. You need to be ready to manage the risks that come with a slowed economy. That’s easier said than done, says Andrew Hiles, founding director of British consulting firm Kingswell. “If a company has its back to the wall, worrying about its survival, it isn’t going to welcome any additional spending on protecting itself against a dreaded event that hasn’t happened in its twenty year history – unless there are clear benefits here and now.”

Like Hiles, Brian Zawada, director of consulting services for Avalution, believes that BC programs cannot continue to thrive if we don’t start demonstrating the business value of continuity plans. He says it’s not just the economy causing BC budgets to be cut, but also poorly aligned plans.

“We can blame the economy all day long,” he says. “I know some organizations have lost people and they’ve got great programs, but those situations are much rarer than those that had their budgets cut because they have a program that’s poorly aligned, connected to the wrong part of the organization or that just exist to exist. Those are the ones that are having trouble… they should not be pointing exclusively to the economy as the source of their problems.”

Instead, think of the slowing economy as a chance to streamline and improve your BC program. The program should not just ensure your company’s resilience in the face of a disaster, but also its continued success no matter what the state of the economy. We asked the experts for their advice on how BC managers can move forward for better or worse in the new economic reality.

Redefining Business Continuity

According to Jon Toigo, CEO and managing principal of Toigo Partners International, it’s time to start thinking about business continuity and disaster recovery in a different way.

“I have been recommending that people raise their heads about the continuity planning tradition,” Toigo says. “You have to stop thinking about continuity and disaster recovery planning as simply a way to hold on to some additional technology.”

For example, disaster recovery shouldn’t just be about backing up all the data in a company, he says. You should instead be looking at protecting that data that is relevant to your core business processes. Move it beyond disaster recovery and start looking a the bigger picture of what that data means for your business.

“Don’t call it disaster recovery anymore,” Toigo recommends. “Call it a data management initiative. Elevate the value of disaster recovery.”

It really should be about a lot more than just the continuity of operations in a disaster, adds Hiles. “Maybe we need to shift the emphasis slightly,” he says. “Instead of being business continuity managers, we should promote ourselves as business continuity managers.”

He says it’s time to exercise business analysis skills outside of traditional areas of continuity planning and stray more into business and operation areas in the interest of doing a risk assessment.

Strategize, Don’t Plan

Too many BC planners weren’t taking the overall business drivers into account and aligning their plans with those, says Zawada.

“Business continuity folks have done a bad job of being able to connect to their business constituents,” he says. “They often develop plans and execute analyses for no other reason than trying to recover an organization chart. They are not connecting to the business’ critical products and services, and as a result, they don’t speak the language of the business executives.”

Every business has a goal, and it’s the job of the BC manager to help that business reach its goals no matter what gets thrown in its path. It’s not just about helping the business survive, but also to help it thrive even after a disaster strikes.

The best way to do that is to find the right areas to protect, rather than trying to protect everything, adds Toigo. “You have to understand which assets are important, and which ones are less important,” he says. “You have to understand what the relationship is between that asset and the business process.”

Take data protection, for example. Toigo says you need to ensure you right-size your data protection strategy to reflect the actual business value of the data you’re protecting. Not all data is created equal, so start by analyzing business data to determine what data is the most important. That data will likely require more expensive protective services. You can then safeguard the non-core data with less expensive approaches, like tape backup.

The key is to understand what data and processes really help the business achieve its goals and focus on protecting that. “Business continuity professionals really need to go back to school in terms of understanding what their organization delivers,” Zawada says. “Focus your efforts on those products, services and activities that deliver value. In doing that, you’re going to be viewed as much more aligned with the business – and more valued – than you would otherwise.”

Educate Management and Build Teams

If you really want to ensure your BC programs continue (and hopefully without too many budget cuts), you must educate your company’s executive management as to both the importance of business continuity and how it can help the business meet its core objectives, says Brown.

“Executive education is the most important thing for business continuity professionals,” he says. “A lot of people who are having problems in the industry right now don’t know how to talk to executives.”

Start by ensuring you have an open line of communication with company executives, says Zawada. You need to show them you understand what’s important to the business, and try and get them to understand the importance of BC’s role. “These are things that have been overlooked in better times,” Zawada says. “It seems like common sense, but too many people are living in a vacuum, and if you do that, you’re going to be at the top of the list to get chopped.”

What If You Don’t Have a Direct Line to Upper Management?

“Often people say, ‘I don’t get to talk to my company’s executives. How am I going to go educate them? I’m five levels below an executive, and they wouldn’t know me if they saw me in an elevator,’” Brown says. “The answer to that is to get partners.”

By partners, Brown means recruiting members of other departments to get on board with BC initiatives. Try looking for allies in areas such as human resources, finance, security, manufacturing, sales and marketing, and get them to understand the value it will bring them to have a good BC strategy in place.

For example, approach someone in HR (a manager, director, or even the vice president) and show them how a good BC plan will ensure staff continues working even after a disaster or in the event of a pandemic. If you can find a partner in HR that agrees a BC strategy will help him achieve his department’s objectives, you can use that person to help you convince executive management that you need the right amount of funding.

“As a team, you’re a lot stronger,” Brown says. “No executive is going to ignore something if the whole management team thinks it’s important. That can be even more powerful than educating executives.”

Focus On Cost Containment

Of course, no matter how closely aligned your BC strategy is with the business, it can be difficult to make the case that you can actually bring in revenue. That’s why you need to focus on reducing or containing your costs to help provide relief to the company’s bottom line, says Hiles.

“It may be difficult to see how BC can help increase cash flow, however we can seek to reduce cash outflow,” he says. He recommends looking for ways to reduce or defer spending to keep the BC program as lean as possible.

According to Brown, controlling costs doesn’t have to be difficult. There are plenty of areas you can look to reduce costs. For example, consider renegotiating your contracts with hot site vendors or ask vendors to defer payments until the economy has started to pick up again.

Finally, Brown recommends you look for ways to spend what he calls other people’s money. If you need to buy an emergency notification system, talk to HR or marketing and see if those departments can also find a use for the system for contacting staff or using it to market to customers. Then, the money can come out of an HR or marketing budget rather than from your own.

Get Ready for the New Economy

The good news is that no one, not even the most pessimistic of pundits, expects the current recession to last forever. There are already positive signs the economy is starting to pick up, although most experts expect it may be a lengthy recovery.

But even when the economy regains its strength, most experts in the BC field agree it’s going to be a whole new world going forward, and that we cannot forget the lessons we learned during this downturn.

“Before the downturn, there were a number of organizations that were poorly aligned and couldn’t articulate what they were doing,” says Zawada. “More and more people are coming to that realization.”

That means BC managers will still be faced with some tough choices in the years ahead, and have to continue to focus on the core business functions and value. The industry will always be faced with challenges both big and small, and the key is to ensure your own BC strategies are properly aligned with your business and that your business will continue even in the event the unthinkable happens.