Risk-Management : Risk Assessment : Business Continuity :
Are You Prepared for Business Disruptions?
Events such as Hurricanes Sandy and Katrina, the 2011 Japanese tsunami and nuclear disaster, 2010’s Pakistani floods and the eruption of Iceland’s Eyjafjallajökull volcano demonstrated that business disruptions are no longer confined to one-time, short lived events.
Instead, such catastrophes are occurring more regularly and having devastating consequences across companies’ operations. As companies begin to realize the new normal, which consists of longer lasting business disruptions, events are compelling them to evaluate their current crisis management programs to assess implementing a comprehensive business continuity program.
Plans that detail a business’s initial emergency response provide a roadmap for keeping operations running through a crisis and ready a business for the return to full operational effectiveness in the weeks that follow a disruption. These forward-thinking solutions are critical components to effective business continuity programs, according to a new PwC US paper entitled, “Beyond the first 48 hours: Can your business continuity plan go the distance?”
“Business disruptions, whether natural or manmade, are inevitable today and are leaving businesses of all shapes and sizes crippled for days, weeks and more recently months. It’s no longer a matter of when a business disruption will strike, it’s a matter of how devastating it will be to a business, their resources and operations,” said Dean Simone, leader of PwC’s U.S. Risk Assurance practice. “An effective and tested crisis management plan will get a company through the initial impacts of major events, but in order to address the aftermath, organizations need a comprehensive plan. Today, a company’s ability to respond to a business disruption could either protect or damage their brand for decades to come. The best-prepared companies are ready with a complete and coordinated business continuity management process that covers the full crisis lifecycle beyond the first 48 hours - from emergency response to crisis management to recovery.”
PwC’s report examines the critical challenges of coping with the increased and unexpected risks of business disruptions. The paper outlines PwC’s recommended approach to effective business continuity management programs:
“Companies need the right business continuity management program to react quickly and effectively to mitigate any revenue loss, potential damage to their reputation and return to full-operational status,” said Phil Samson, leader of PwC’s Business Continuity Management service. “Having a holistic plan helps an organization absorb the initial crisis, makes them resilient enough to remain standing through the aftershocks, and properly organizes them to return critical processes in the weeks and months that follow.”
“Beyond mega-disasters, advances in technology increase the possibility of devastating manmade crises such as cyber-attacks,” said Ken Coy, leader of PwC’s Governance, Risk & Compliance practice. “From deleting data to deliberate acts of destruction, having a risk-resilient design and tested crisis response is not enough. Establishing a governance and program management structure which aligns your crisis and business continuity management objectives are the keys to effective planning.”
PwC understands that significant risk is rarely confined to discrete areas within an organization. Rather, most significant risks have a wide-ranging impact across the organization. As a result, PwC's Risk Assurance practice has developed a holistic approach to risk that protects business, facilitates strategic decision making and enhances efficiency. This approach is complemented by the extensive risk and controls technical knowledge and sector-specific experience of its Risk Assurance professionals. The end result is a risk solution tailored to meet the unique needs of clients.