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Being Prepared for the Worst
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Being Prepared for the Worst

Business continuity management enhances the chances for survival

When it comes to emergency planning, companies are ill-advised to rely on attitudes such as “What will be, will be” or “Things have always turned out for the good”. They should instead take the necessary steps to secure their core business from events which are improbable or unforeseeable, but which would negatively impact business operations.

"Power failure shuts down ATMs at 150 savings and loans” headlined the report from Hanover on 2 October 2008. The night before, a marten had chewed through a 110-kilovolt cable inadequately protected from animal bites in a transformer station, causing a short circuit and failure in the station. The power supply to a central computer center operated by an IT service provider for the savings and loans was shut off. The domino effect from the power failure became a computer failure: the ATMs and the online banking for 150 savings and loans in the northern German states were offline until midday. What went wrong? Obviously there was no emergency planning which would secure operations in the event of a power failure.

Preparing emergency plans for crisis situations is the task of business continuity management (BCM). Companies must be protected from catastrophic scenarios and the threats to their existence which often result. Such situations include flooding, pandemics, natural disasters, or even terrorist attacks. Depending on the views within the company, however, horror visions can also include events which are definitely much more likely such as power failures and fire which would also have a major effect on business operations and must be covered by emergency planning.

The great uncertainty regarding the occurrence of scenarios relevant for BCM is mirrored by the doubts that plague the assessments of time, money, and effort required for emergency management; are the expenditures in a reasonable ratio to the level of real risk? But what is certainly needed in any case is a clear and structured approach which can identify the company areas really worth protecting, then either to assure implementation of measures providing protection from events which, however unlikely, would prove catastrophic or to decide consciously that no measures are required.




BCM is part of operational risk management. The objective is to identify as a precautionary measure the possible dangers to business operations, to assess them, and either to initiate measures to reduce risk or to accept the residual risk. BCM models the special case of emergency measures for business functions which are of such consequence that their non-availability for a certain period of time would threaten the very existence of the company. Above all, worst-case scenarios such as the complete loss of the operational site are taken into account, and emergency measures are implemented in all of the company units, from the (emergency) organization to workforce, IT and technology, buildings, and locations.

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