Is Your Business Disaster Ready?

26 May 2022

Over the last two years, businesses worldwide have been struck by disaster after disaster.  These have included a global pandemic, war in the Ukraine, natural disasters, and cyber-attacks to name just a few. In some instances, business owners have barely recovered from one crisis before the next arrives.

Now more than ever it is important for your business to have a Business Continuity Plan.

What is a Business Continuity Plan?

A Business Continuity Plan documents how your business will continue to operate in the event of a potential disaster. It documents how you will stay operational; what people resources will be required; what alternative production or operations facilities you might require; who your alternate suppliers would be.  This document is critical to the long-term success of your business in a crisis and needs to be flexible and easy to adapt to your circumstances.

Consider the COVID bans on alcohol production in South Africa.  Manufacturers could have sat back and let their assets lie idle, or they could consider alternatives.  Most manufacturers did a mix of the following, converting their production facilities to pack alcohol-based hand sanitisers and/or non-alcoholic beverages.  While this was not their core business, they were able to continue to sell products and pay their employees.

How do you develop this critical document?

This step-by-step process will get you started.

Step 1: Establish a Crisis Team

The crisis team should be a cross functional team that understands the full end-to-end operations of your supply chain.  It should include support functions such as finance and human resources. 

Step 2: Identify Potential Risks to your Business

As a team you need to brainstorm all the potential risks that could impact business continuity of your supply chain.  Typical examples might be industrial unrest, supply interruption, natural disaster, and cyber security incidents.

Step 3: Evaluate the Risks Identified

Each risk needs to be assessed in two dimensions:

  • Likelihood – what is the likelihood of the risk occurring?
  • Impact – what is the impact of the risk on business continuity? High? Medium? Low?

By assessing both aspects of the risk, the Crisis Team can determine the mitigation approach for each risk identified.

Step 4: Select the Risk Mitigation Strategies

There are various strategies for mitigating risk, here you need to be practical.  The likelihood and potential impact of each risk will determine the level of effort and energy that should be put into a mitigation plan.  If a risk is highly unlikely, then do nothing.  Whereas, if a risk is highly likely, you might need to consider a robust mitigation plan.

Step 5: Document the Business Continuity Plan

It is critical that once the risk planning is done, this plan is clearly documented in a simple, yet comprehensive format that everyone will understand.

Step 6: Educate to Key Stakeholders

A risk plan means nothing if nobody knows about it.  So, it is important that it is well communicated to key stakeholders.

Step 7: Test the Plan

Lastly, no plan is fool proof, so it is important to test the plan at regular intervals and make sure that it is still relevant and works.

Hopefully this article got you thinking about your own business and its associated risks.  Good luck developing your Business Continuity Plan.

Written by Special Guest Writer, Chanti Wilson. Executive Leadership Coach |Business Consultant | SAPICS Director

A Supply Chain Consultant with over 20 years’ experience, Chanti Wilson has experience in a range of industries including FMCG, Automotive, Agricultural and Packaging, where she has implemented the practices of Supply, Demand, Sales & Operations Planning and Procurement. Chanti is currently a Director at SAPICS – The Professional Body for Supply Chain Management and chairs the SAPICS Small Business Hub sub-committee.   In addition, Chanti works as Client Support Manager for CCi and MBA Teaching Assistant at UJ for their Operations and Supply Chain Module. Her passion is developing skills that will grow the South African economy and actively does this through coaching and mentoring young Supply Chain Professionals.

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