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No matter the size of an organization or its industry, business continuity — or the process by which companies maintain the viability of their business processes in the event of a disruption — is a critical issue facing senior management and corporate boards. Faced with greater scrutiny from regulators, shareholders, and customers, business continuity is no longer just an audit comment but an essential part of maintaining a business edge.
Many of the business drivers behind the focus on business continuity management and crisis readiness can be found in the myriad of regulations facing organizations today. Regulatory issues are no longer limited to the financial service industry but, as in the case of Sarbanes-Oxley, impact all industries. No one can dispute the fact that an effective business continuity plan is essential in today's corporate and political environment. Equally important is the mandate by customers that their suppliers and vendors maintain business continuity plans in order to ensure an end-to-end process capability in the event of a disaster.
In the United States, standards such as Federal Financial Institutions Examination Council, Securities and Exchange Commission, National Association of Securities Dealers, New York Stock Exchange (in the financial sector), Health Insurance Portability and Accountability Act (in the healthcare sector), Federal Energy Regulatory Commission, and Natural Environment Research Council (in the energy sector), have put business continuity management at the top of many boardroom agendas.
Similar regulations in the United Kingdom and Europe, such as the Turnbull Report, various Codes of Corporate Governance and Business Control and Transparency Act introduced by Germany in 1998, reiterate the need for corporate risk management and business continuity controls. In fact, business continuity management has become a vital component of corporate governance and compliance with best practices around the world.
What Will You Say When They Ask What Happened?
Understanding the impact of risks is the crucial element in the development of a business continuity plan. Armed with this information, an organization can prepare a cost effective business continuity plan as part of a total risk transfer architecture. This would include risk mitigation, insurance, and reacting to an interruption. In this way, an organization can respond to the many events that are outside of the control of the organization — such as natural and manmade disasters, changes in regulations, economic downturns, etc.
While terrorism presents the dramatic interruption danger, companies also face interruptions caused by such mundane issues as crumbling and aged infrastructure. To maintain operations in the event of a business disruption, executives must consider complex questions such as:
- How can I anticipate business risks that could impact my company's ability to meet its financial objectives?
- How do I quantify the financial impact of a sudden operational disruption?
- Is there a clear delegation of roles and responsibilities that will allow my organization to react expeditiously in an emergency situation?
- Do my plans consider an end-to-end recovery solution, including key suppliers?
- In the event of an incident, will we be able to effectively maintain operations and communicate with employees, customers, suppliers, and regulators?
Who's Looking Out for You?
The Business Continuity Risk Management and Crisis Readiness consulting practice at Marsh takes a holistic view to reducing financial, operational, and service related risk in today's challenging business environment. With our industry expertise we intertwine business continuity planning, emergency response planning, and crisis management to bring to bear the solution that is appropriate for your organization as you address today's business and technical challenges.
- Business Continuity Planning: We identify critical risks, quantify their potential impact, and develop recovery and restoration strategies in the event of a severe disruption. With deep experience in business continuity planning and a thorough understanding of the business and regulatory drivers affecting your industry, we can help you to avoid potential penalties and litigation. Our recovery strategies address both technical and business needs — for example, performance and capacity, security, and records management. By raising awareness of business partner/third-party continuity plans, we will help you to avoid service interruptions and protect the entire value chain.
- Emergency Management Solutions: Our emergency management solutions include critical incident planning (CIP)and emergency response planning (ERP). We identify the underlying human factors that lead to the initiation of violent events in communities, schools, and industries and design and implement security planning and training solutions. In addition, we evaluate, organize, and train onsite teams to effectively respond to emergencies. By joining with you to improve employee readiness, we help you enhance safety by establishing an organized, company-wide response to a disruption.
- Crisis Management: We assist organizations in the development of strategies that help manage a situation with all internal and external audiences.
Marsh can help its clients answer their most pressing question: "How does my business continuity plan stack up against my peers?" Our proprietary BCM preparedness review, using TrendTracker®, provides a review of business continuity management and crisis readiness or any of its three components. This process provides a means by which a company's preparedness can be assessed and areas of improvement can be identified.
If you have any questions or would like additional information, please contact us.
If you are seeking information about insurance and related services, please visit marsh.com.
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