How to stay in business – your questions answered

Government statistics show that nearly 1 in 5 businesses suffer a serious disruption every year. Many of these disruptions, such as a fire, flood or loss of IT, happen with little or no warning and can threaten the very existence of a business. How quickly you manage to get back to ‘business as usual’ depends on how well you are prepared for such an event.

Business continuity planning identifies potential threats to trading and provides a simple framework for an effective response should an interruption happen.

This guide highlights the benefits of being prepared and will help you to compile a plan that will give your business the best chance of survival should the worst occur.

Q – Why bother with a business continuity plan?

A – Even with the right levels of insurance cover in place, without having effective recovery procedures a high percentage of organisations suffering a major interruption go into liquidation within 18 months. Business continuity planning helps to reassure your staff, customers, suppliers and financial backers that an effective strategy is in place for managing the unexpected. It also helps to build and maintain a high level of confidence in your business.

Q – But we’re only a small firm. Does this really apply to us?

A – Yes. Your organisation could be next, so can you afford to take that risk? In the last decade with the correlation of climatic change, the UK has witnessed a sizeable number of businesses that have been affected by flooding. Furthermore, an increasing number of maliciously set fires continue to plague businesses and the prospect of trying to recoup the losses incurred by a breakdown of communications as a consequence of any interruption, remains daunting. Separately, matters outside of your control may also affect your business. For example, a major supplier within your business chain may unexpectedly go into liquidation which could impact your ability to trade.

Q – Disasters only happen to others, don’t they?

A – The belief that disasters are rare and only happen to others, is in reality far from the truth. Disasters can and do occur and typically they are caused by one of the following phenomena:

Natural Events – e.g. storm, flood, lightning, adverse weather, subsidence, human/animal disease etc.

Accidents – e.g. fire, explosion, theft, chemical incidents, pollution, telecommunications, computer system or public utility failure, loss/corruption of electronic records including web sites, loss of key staff or suppliers and health related problems such as infestation, legionnaires disease etc.

Man Made Incidents – e.g. identity/intellectual theft, fraud, terrorism, strikes, sabotage, vandalism, fuel shortages etc.

The Chartered Management Institute, supported by others, carried out research early in 2013 and found that:

  • 54% of respondents were interrupted following extreme weather such as floods/storm damage
  • 42% of respondents had suffered from loss of people within their organisation40% of respondents had experienced disruption through the loss of IT capacity during the previous year
  • 27% of respondents had lost telecommunications, whilst
  • 24% of respondents were denied access to their site.

In 2016, the Business Continuity Institute (BCI) published their Horizon Scan Report, following collaborative work with the BSI, which highlighted the top 6 perceived threats to business being Cyber attack, Data breach, loss of telecommunications, terrorism, security issues and interruption to utility supplies. Imbedding business continuity throughout your organisation helps you to be prepared to return to ‘business as usual’ in the quickest possible time.

Q – Ok, so how do I develop an effective business continuity plan?

A – There are five basic steps towards matching a business continuity plan to your business:

1. Analyse your business

Get the buy in of top management and put together a complete picture of your business. Identify critical functions that are essential to the continuance of it. Examine each of these functions and consider:

  • What support do you have within your own business?
  • Who within the business would be best placed to review the issues?

2. Assess the risks

Where is your business vulnerable? Each area of the business should be analysed evaluating how the loss of a cog within the overall process may disrupt the business as a whole. Consider the ‘knock on effect’ and the impact on your customers if you encounter problems with your premises, suppliers, partnerships, staff, systems/processes or timescales. Remember you don’t have to be the target of terrorism for your building to lose the electrical power supply. Accidents such as workmen cutting through a cable or flooding from a ruptured water main could leave you dark, cold and unable to trade.

3. Develop your strategy

Having identified the risks it should then be possible to address each exposure in order to:

  • Eliminate the hazard altogether
  • Avoid the hazard by doing things differently
  • Control the hazard in order to reduce its impact or,
  • Plan for the occurrence

Some risk improvement measures may be considered essential and may change some current working practices while others may have to be assessed against monetary costs.

4. Develop your plan

Your business continuity plan will be unique but should:

  • Make it clear who needs to do what and who takes responsibility for what. Appoint a business continuity team and co-ordinator. Always include deputies to cover key roles.
  • Use checklists and include clear, direct instructions for the crucial first hour after an incident.
  • Ask ‘what if’ questions and plan for the worst case scenario.

For example: So what if:

  • Your premises were severely damaged rendering them unusable?
  • Vital manufacturing and production facilities are lost?
  • There is a loss of telephone calls from the public & business partners?
  • Your IT networks cease to function?
  • You lost key information such as customer databases, billing information, regulatory information etc? (Are back up records kept offsite and tested to ensure they will work?)
  • Your suppliers could not supply you?You could not ensure continuity of service to your key customers?
  • You lost the services of one or more key employees?
  • You suffer cash flow problems. What if your customers could not pay you or you could not pay your suppliers? Can you continue to pay staff?
  • Your staff or vehicles could not gain access to the building for some period of time?
  • Your reputation was damaged by adverse publicity following the incident?
  • Build in realistic timescales to get the business working again whatever the scale of the interruption. If your plan is robust enough to cope when the worst happens, it will help you deal more easily with smaller scale emergencies.
  • Remember to take into account the needs of the emergency services. Log the nature and location of hazardous materials, water supplies, gas and other fuel isolation and the extent of hidden voids and links between buildings. Consideration should also be given to fire fighting access and means by which key staff may be alerted and respond to an emergency at any time.
  • Keep an up-to-date directory of key contacts and give a copy to every member of your team. Include contact details of staff, public utilities, bank, insurance contacts, suppliers, tradesmen, key customers and any other persons or organisations who need to be alerted to a problem and can help limit disruption to your business.
  • Consider media training for senior staff. Handling press enquiries professionally during a crisis can help to maintain public confidence in your business.
  • Think of your business continuity plan as a living document and ensure that it keeps pace with any changes to the business or personnel. Appoint someone to take on the responsibility for updating and managing the plan with a periodic review (at least annually) to ensure information is kept up to date. It may be prudent to include it as an agenda item on any internal management or health and safety meetings.
  • With any update it is essential that all actions taken to reduce or eliminate the risks of an interruption to the business remain in force. Notify all team members when changes are made.

5. Rehearse your plan

Give your plan a regular health check. Test the plan at least once a year or as far as is practical. This will highlight any weaknesses and allow suitable changes to be made. Keep copies of the plan securely offsite and ensure that they are accessible at a moment’s notice.

Q – Where can we get help preparing the plan?

A – There are a number of options you may wish to consider.

  • RISC Authority is funded by a group of UK Insurers, including Allianz, in pursuit of risk reduction. You can download a copy of their ROBUST software toolkit free of charge via
  • If you have a commercial insurance policy with Allianz, they have a preferred supplier facility providing access to a range of products and services at discounted prices. They offer a convenient and cost effective way to help implement risk management measures. Glen Abbot Ltd act in this capacity
  • Finally, there are a number of companies and consultants who specialise in the field of Business Continuity planning. The Business Continuity Institute offers a range of consultants who are available to quote for specific requirements.

And finally

Your business continuity plan is an investment and should be treated as such. Hopefully you will never have to use it in a real situation. But by maintaining, testing and up-dating it on a regular basis you will ensure that the consequences of any interruption can be faced with confidence and your organisation will be ‘back in business’ in the quickest possible time.

This article originally appeared on Allianz.

You should also consider what Business Interruption insurance you have in place to support your business continuity plan and please get in touch with us if you would like to discuss this further.

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