To grasp the problem faced by business continuity professionals in the current corporate environment, it is important to understand corporate structure, as well as the role that education plays in the corporate environment. Today’s corporate directors and officers of companies can be held responsible for the consequences of business interruption or the loss of business-critical information. This liability could be compounded given the nature of business. For example, companies that suffer online business disruptions of nearly any magnitude often make headlines, with individuals singled out by the media and corporate leaders finding their personal reputations at risk.
In addition, serious business interruptions are now measured in minutes rather than hours. What was once considered only a minor problem can cause the same level of loss as a major problem (such as a power outage or a flooded data center) if a critical business process is affected. Furthermore, the law, particularly for a public company, may require adequate protection of data by companies. Many companies stipulate in their contracts that suppliers of services must deliver those services under any circumstances.
Change: Continuity at the Core
The business rules have clearly changed; therefore, the paradigm for managing business continuity must change. But how?
Plans are evolving from recovery to continuity, and their content must focus on the effect rather than the cause. A business function goes away; the reason why doesn’t matter. Virtual organizations will emerge, but the more companies become virtual in scope, the more susceptible they become to cyber risk. Furthermore, IT governance compels companies to exhibit fiduciary responsibility. BC/DR should be managed as a business expense, determining the total cost of ownership (TCO), defining the return on investment (ROI), establishing uniform budgeting guidelines, and increasing the need for BCP staff with business management skills.
Companies that spend more (as a percentage of their total capital budget) on BC/DR capabilities are more resilient to business disruptions. Companies that spend less time on BC/DR do so because their business model has the BD/DR business function reporting to the information technology area. Companies that spend more time on BC/DR do so because their business model has the BC/DR business function reporting to the senior executive. These companies have embraced BC/DR as a core value across the organization.
Change: Innovation as the Key
The mantra of change seems so simplistic; however, implementation is often a complicated and flawed process. Change requires innovation, which, although necessary to the success of every organization, remains one of the greatest challenges for a firm to manage. The high levels of uncertainty and the complexity of today’s environments have increased both the opportunities and the threats in managing innovation.
Organizations need to innovate to thrive and, sometimes, even to survive. This suggests the managers within these organizations need to continually challenge the status quo. They cannot be content with doing things the same way. Nor can they be content with offering the same old products and services. Resting on the laurels of past successes is the kiss of death to any organization. Some experts have even suggested that the seeds of an organization’s success quickly become the seeds of its downfall. What worked in the past will not necessarily work in the future. So what actions do organizations need to take?
Innovative organizations tend to be decentralized and strive for more open communication systems. They listen to their customers, both internal and external. In a highly centralized organization, the majority of the decisions are made at the top after information slowly makes its way up the organizational hierarchy. In a decentralized organization employees are empowered to make more decisions, thereby enhancing the organization’s ability to be responsive to changes as they are detected in the environment.
It is critical for a company to have positions that reach out and respond to comments and concerns of the customer, rather than wait for customers to relate what they want. Today’s proactive organizations must be close enough to their customers to be able to anticipate what they may want in the future – before the customer even realizes it. The key is to anticipate what the customer needs and then deliver it before the customer asks for it. As this shows, BC/DR is best supported when this anticipation of the customer’s needs occurs.
Change: For the Better
While there are risks inherent in innovation, there are greater risks involved in ignoring the power to be harnessed in becoming an innovative organization. The opportunities that then present themselves to the innovative organization (and the people within that organization) increase astronomically. All the previous evidence supports that only those organizations that are committed to innovation on an ongoing basis will thrive in the competitive landscape of the 21st century.
Marty Kowalski, MBCP, is a business resiliency consultant with Solution Technology Inc./Mindgent based in Chicago. He is a graduate of DePaul University with a B.A. in business continuity/disaster recovery and currently serves on the certification commission and the educational advisory council of DRI International.