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Need for BCM |
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The Asia-Pacific region experiences nearly 60 per cent of the world's natural disasters. India, on account of its geographical position, climate and geological setting, is the worst-affected.
The country is regularly faced with drought, floods, earthquakes, cyclones and more recently, the
tsunami./p>
The Tsunami which struck the Indian sub-continent in December, 2004 caused damage to assets estimated at about $575 million and productivity losses about $450 million. Overall rehabilitation and reconstruction needs in the four mainland tsunami-affected states and territories of India are to the tune of US$1.2 billion, according to a Damage and Needs Assessment Report prepared jointly by the World Bank, Asian Development Bank, and United Nations at the request of the Government of India.
The earthquake that struck western and central Gujarat on January 26,
2001 caused enormous loss of life and near total destruction of physical assets, affecting around 20 million people. The state was totally unprepared for the disaster.
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What is the worst thing that can happen to your organization? How will you deal with it? If there is even a slight chance that it could happen, assume that it will. What are you going to do about it? How prepared are you to handle a large scale emergency?
These are some of the questions you need to address.
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The modern business environment is
characterized by risk and there are many risks that could stop an organisation from achieving its objectives and targets.
Changing market conditions, e.g. recession in the Asian economies;
Reducing demand for products or services, perhaps because the market is shrinking, the product/service is becoming uncompetitive or the business has developed a poor reputation;
Changed legal or regulatory restrictions, e.g. in the tobacco industry;
Illegal or negligent acts resulting in losses, legal action or restrictions, e.g. fraud, failure to comply with health and safety legislation;
Loss, damage or denial of access to key infrastructure services, e.g: to premises, utility services (power, water, telecommunications etc.), information systems, manufacturing plant etc;
Failure or non-performance of critical suppliers, distributors or other third parties particularly where key business functions or processes have been outsourced;
Industrial action or other loss of key staff.
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Business continuity management (BCM) is a key element of risk management. It addresses the risks mentioned
earlier which could immediately threaten the continuity of a business. These risks
may affect critical business processes and the consequences can be severe and include substantial financial loss, embarrassment and loss of credibility or goodwill for the
organisation concerned. |
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If an organisation does not manage business continuity effectively, the chances are that it does not even understand its minimum acceptable levels of business. Should a serious incident occur, there will not be a consistent corporate view of priorities and the organisation will not have the infrastructure, plans and procedures in place to deal with the crisis.
Business continuity management is here to stay. Risks to business will change, as will solutions for managing risk, but the need to manage risk will remain. Business continuity can avoid single points of failure and reduce the risks from traditional business continuity failures such as disaster, denial of access and system failure.
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| The Tsunami that affected
225,000 people around the Indian Ocean./font> |
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| The devastating earthquake
killed 20,000 people and left 500,000 homeless. 80-90% of the buildings in the town of Bhuj - near the
epicenter of the quake - were destroyed. |
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| In the September 11, 2001 attack on New York City, 2,823 people are believed to have died. The total economic loss is estimated to be $105 billion. |
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