Are you building a business continuity and disaster recovery plan for your growing financial enterprise? If not constructed correctly, a lot can go wrong when an unforeseen disaster strikes. Is your business prepared?
The financial industry has successfully navigated some of the immediate impacts of the COVID-19 pandemic. The situation has exposed critical flaws in business continuity and disaster recovery plans. Here are some of the mission-critical steps to follow to build your comprehensive disaster recovery and business continuity plan for your financial organization.
How to Master Business Continuity and Disaster Recovery Plans During COVID-19
Unfortunately, many businesses weren’t ready when COVID-19 hit. Their business continuity (BC) and disaster recovery (DC) plans weren’t robust enough to mitigate the pandemic's impact on supply chains and the enforcement of social distancing.
They either underestimated or were unwilling to devote the proper amount of time and effort required to conduct an adequate business impact analysis and risk assessment. Another common mistake we see is businesses thinking a BC and DR plan are the same thing. Or, they believe that only a DR plan is necessary.
Businesses who only had a DR plan found themselves unprepared for everything beyond the IT infrastructures included in the DR plan. They had no long-term plan that prepared them for the disruption to their core business processes and functions.
You should give your business the best shot at successfully navigating COVID-19 and any other unforeseen disasters. We recommend following the steps below to build a continuity and disaster recovery plan that’s thorough and robust.
1. Build a Business Continuity Team
Your business continuity team should include the people responsible for implementing and executing the business’ continuity plan.
At the very least, your continuity team should include:
- Business Executive or delegate
- Risk and Compliance personnel
- Information Technology officer
Medium to large-sized organizations should include additional personnel on their continuity team. It would be best if you equally dispersed duties amongst the team members.
2. Conduct Impact Analysis
Conducting a business impact analysis (BIC) isn't something your team should try and tackle without a detailed questionnaire. This questionnaire will guide them and ensure they gather all the necessary information to perform a comprehensive analysis. Your business continuity team will need to make a list of the risks and threats to your business and create a plan for mitigating each one in the event of a disruption or disaster.
The major categories of risks they’ll need to consider and make preparations for are:
- Operational Risks
- Financial Risks
- Physical Risks
3. Identify Business Continuity Resources
Your team created a list of all risks and assessed the impact of each risk on your business. Now, it's time to perform a gap analysis to determine what resources are required to mitigate these risks.
For example, businesses that included strategies for enabling remote work in their BC plans were in a much better position when COVID-19 struck.
Other businesses without those strategies had tough choices to make. They had to choose between either slimming down operations, closing their doors, or investing in the infrastructure necessary to enable remote work.
Have your team evaluate their business continuity plan thoroughly by completing a gap analysis to discover crucial resources that may be lacking.
4. Identify Recovery Strategies
By now, your team should have a pretty good idea of:
- What risks you’re likely to encounter
- The impact each risk would pose to your organization
- The resources you need to mitigate potential disruptions
Suppose your team created a comprehensive and robust BC plan. In that case, you'll be able to quickly identify which recovery strategies would be the most effective at mitigating risk. Document these strategies as action steps your company will take in the event of another pandemic or a similarly devastating disaster.
With a detailed plan, you will know precisely what resources you need, how much they cost, and how fast you can be up and running again. Plus, having this plan in place will allow you to respond immediately vs. days or weeks after a disaster — saving you valuable time and resources.
5. Perform Routine Business Continuity Audits
It’s not enough to have a business continuity plan and disaster recovery plan if they are gathering dust in a file cabinet. You need to test and tweak them frequently to assess and protect your company from unforeseen new risks.
Your business processes and functions are ever-evolving and adapting to the current market and industry climate. Your BC and DR plans need to be adapting and evolving too.
Putting together a business continuity team and leading them to perform their new duties is time-consuming and complicated. That’s why you should consider outsourcing your risk mitigation management needs to a 3rd-party provider — like Compliance Core.
A 3rd-party provider will be up to date on the latest risk management trends and regulatory compliance, so their experience is invaluable. Not only will your team benefit from their experience, but you’ll have the flexibility to focus on other crucial aspects of your business. At the same time, they protect your company from risks you might never have discovered on your own.
Find out how well your company manages and mitigates risks and regulatory compliance by taking our free self-assessment.