Business continuity and proactive resilience – what’s the difference?

Business continuity and proactive resilience are no longer “nice to haves”

Today, it seems that every organisation is either in the middle of a crisis, coming out the other side of a crisis or about to face one. A crisis can take many forms, without warning, from natural disasters to product recalls. It’s no longer a matter of if, but when and how a business will respond.

Many organisations have, unfortunately, discovered that even a small interruption can have long-lasting damaging effects on their business operations, resulting in lost revenue, diminished customer confidence and heightened compliance risk.

Business continuity management has been around for a long time, but when done well, helps to maintain great relationships with customers during times of crisis, not just keep the business operating. According to McKinsey , companies that focus too much on short-term defensive measures risk side-lining initiatives vital to keeping pace with the market, achieving longer-term goals, and even notching unexpected quick wins.

The result is that companies are now developing holistic business continuity plans that can keep the business running, protect data, safeguard the brand, while retaining customers. Yet, developing a comprehensive business continuity plan has become more difficult as systems are organisations are increasingly integrated and distributed.

By investing in the digital infrastructure, organisations will have increased accessibility and flexibility to be able to build out alternative scenarios. They can also use insights to set thresholds and alerts if forecasts are outside of ranges.

By prioritising business resilience as well as business continuity, organisations can thrive in a constantly changing world. Building agility into the organisational DNA enables employees to think on their feet and empowers leaders to anticipate and remove roadblocks to their success.

As defined by BCG , top performing organisations in economic uncertainty do not just wait for recovery; instead, they build competitive advantage and turn ambiguity into a source of opportunity.

Business continuity versus proactive resilience – aren’t they both the same thing?

For many organisations, the terms are used interchangeably, but there are differences between them and the approach required for each.

Business continuity is a way of addressing any disruption to business operations until the underlying problem can be resolved. It involves a planning process, where stakeholders begin with a risk assessment, determine the scope of the plan to keep the business operational during periods of disruption. They are not typically designed to resolve the problems, but merely keep mission-critical operations running as smoothly as possible during disruptions.

Disaster recovery, a subset of business continuity, typically focuses on IT and infrastructure response. It focuses on the immediacy of an undesired event, such as system failure or data breach, and is often used alongside a business continuity plan often with critical deadlines.

To be effective, businesses need both plans, that are seamlessly integrated into the organisational culture and broader technology environment.

But how does resilience fit in, and more importantly, proactive resilience? If, resilience is described as the ability to function during a crisis and recover afterwards from difficulties. However, recovery alone is not an adequate goal, especially as solutions are typically focused on building buffers or risk-avoidance, which does not future proof the organisation.

Proactive resilience is a holistic, company-wide risk management approach that results in sustained superior performance, over time through innovation and agility. Truly resilient organisations are able to bounce back better and even thrive, and that’s where proactive resilience becomes essential.

It’s not just a one-off plan, that gets stored (or lost) somewhere safe

One common mistake is that organisations hand the business continuity plan to the IT department to set up and manage. However, that fails to consider the overall business, processes and people involved.

The business continuity strategy is the responsibility of the CEO and the Senior Management team and not “just” the IT department. It needs to be viewed as a business strategy and not a technology strategy. It is essential that everyone in the business is briefed and knows what to do, and what their role is should a disaster occur.

When devising a business continuity strategy, leaders should consider the 4 P’s , namely: people (staff and customers), processes (the technology and processes required), premises and providers, suppliers and partners. This methodology enables decision makers to take a holistic view of business continuity across the business and not just focusing on the technology.

It’s critical to identify networks and interdependencies, such as supply chain which affects production, availability and prices more quickly. Understanding networks and connections better in today’s environment is a key aspect of resilience.

It is a circular process that constantly evolves and needs to be regularly fine-tuned and improved; the process never stops. It should become a source reference at the time of a disruptive event or crisis and the blueprint for strategy and tactics to deal with the event or crisis.

Business resilience requires companies to monitor potential challenges as part of their daily processes. Organisations rarely get advance notice that a disaster is ready to strike and even with lead time, multiple things can go wrong, or unfold in unexpected ways.

For further information, including best practice tips, download our business continuity whitepaper here