21. Contingency Planning Flashcards
<p>How is Business Continuity Plan defined?</p>
<p>Shows how a business will operate after a serious incident and how it expects to return to normal in the quickest time possible.</p>
<p>How is Risk Assessment defined?</p>
<p>Identifying and evaluating the potential risks that may be involved in an activity that a business proposes to undertake, ensuring compliance with health and safety legislation.</p>
<p>How is Risk Mitigation Plans defined?</p>
<p>Identify, assess and prioritise risks, and plan responses to deal with the impact of these risks on the operation of the business.</p>
<p>How is Scenario Planning defined?</p>
<p>A strategic planning method designed to explore uncertainties, learn how to protect the business from their worst consequences and prepare how to exploit any opportunities that might present themselves.</p>
<p>How is Succession Planning defined?</p>
<p>Identifying and developing people who have the potential to occupy key roles in a business in the future.</p>
<p>What is Scenario Planning?</p>
<p>- Many business undertake scenario planning in an effort to deal with unforeseen events
<br></br>- Scenario is not about trying to predict future events
<br></br>- It is a strategic planning method designed to explore uncertainties,, work out how to protect the business from their worst consequences and prepare how to exploit any opportunities that may present themselves</p>
<p>What can Scenario planning help you do?</p>
<p>- clarify some of the future uncertainties in business identify risk and opportunities and prepare for their eventuality
<br></br>- teach managers how events may transpire, develop and affect the business
<br></br>- understand the causes and effects of change in business and how to manage</p>
<p>What are some of the important steps in Scenario Planning?</p>
<p>1 - Identify possible trends and issues --> scanning internal and external environment - using PESTLE analysis
<br></br>2 - Build possible scenarios --> imagine a range of possible scenarios that might affect operations
<br></br>3 - Plan response --> identifying the impact the scenarios will have on the business and developing plans to deal with them
<br></br>4 - Identify the most likely scenarios --> priorities the most likely and thoroughly plan for each
<br></br>5 - Capitalise on Scenarios --> implementing the planned response when scenarios appear - not all scenarios end with a negative outcome</p>
<p>What is a Risk Assessment?</p>
<p>- After a business has identified possible scenarios it might face in the future it might use a risk assessment
<br></br>- Involves examining what might cause harm to people and identify the precaution that might be take to protect them from harm
<br></br>- One of the main purposes of risk assessment is to help comply with health and safety legislation
<br></br>- However the use of risk assessment might be extended to assess risk on the business in general --> therefore helpful with scenario planning</p>
<p>What are some possible scenarios a business may have to plan for?</p>
<p>- Natural Disasters
<br></br>- IT system failure
<br></br>- Loss of Key Staff</p>
<p>What are some examples of Risk Mitigating Plans?</p>
<p>- set up in a location that is not vulnerable to flooding, earthquakes, bush fires and other natural disasters
<br></br>-take out adequate insurance policies to cover losses resulting from disasters
<br></br>- ensure that data strewed on computers is as secure as possible and that back-up systems are adequate
<br></br>- organise back-up power, such as a generator, to ensure that vital machinery an other equipment can still be used in the event of a power interruption
<br></br>- ensure that there are adequate communication channels are set up to deal with crises
<br></br>- produce a business continuity plan to deal with crises</p>
<p>Possible crisises: natural disaster</p>
<ol><li><span>Natural disasters are extremelybad events that usually happen suddenly. They arecaused by factors beyond our control.</span></li><li><span>Examplesinclude floods, hurricanes, volcanic eruptions, tsunamis,earthquakes, forest fires, snowstorms and epidemics.</span></li><li><span>Such events can result in high levels of damage, deathand disruption (i.e. when things are unable to happen in the normal way).</span></li><li><span>Many firms are multinationals withoperations in places where some of these events aremore likely to occur, So, multinationals are likely to bemore exposed to the risk of natural disasters.</span></li><li><span>Another common problem around the world is flooding. In recent years, flooding in the USA has been responsiblefor reduced shipping, damaging crops and shutting downports. Last year, three-quarters of Louisiana's rice fieldswere affected by flooding. It was estimated by expertsthat the cost to Louisiana rice fields alone would beapproximately US$14.3 million.</span></li><li><span>Volcanic eruptions can cause large-scale disruptionto business. If a volcano erupts, business activity in theimmediate area will be affected by lava (extremely hot liquid rock) and huge clouds of ash. However, the cloudsof ash can sometimes be so large that flight paths aremade unusable, In 2010, Eyjafjallajokull volcano in Icelanderupted, sending millions of cubic feet of ash over Europe.This posed a threat to aircraft and many airports in Europewere closed for a period of time. Estimates suggested thatthe cost of grounded flights to the global airline industrywas over £1 billion.</span></li><li><span><i>However, some businesses actuallybenefited from the closure of European airspace, Airporthotels were full of travellers who were unable to leave, andtrains, buses and coaches were extremely busy. Eurostartrains between London and Paris or Brussels were soldout</i>.</span></li></ol>
<p>possible crisises: it systems failure</p>
<ol><li><span>Most businesses employ IT systems in their organisation. The extent to which businesses depend on such systems will vary,</span></li><li><span>Generally, the larger the business, the more investment it will have in IT. This means that an IT systems failureor acyberattack could be a serious disaster.</span></li><li><span>Manysmall businesses may have only modest investments in IT systems, For example, computers are used for data storage. email communication, research andwebsite display. However, even smaller businesses areincreasing their reliance on IT, such as for online salesand other transactions. This makes them more likely toexperience breakdowns.</span></li><li><span>Businesses and the public are becoming more andmore concerned about the threat of cyberattacks, Mostpeople don't know the consequences of such attacks,</span></li><li><span><i>However, as the number of attacks increases, awarenessof their effects is being raised</i>,</span></li><li><span>One problem is personaldata being stolen by hackers from businesses. It hasbeen reported that these data breaches' happen on a daily basis, but most of the incidents are small.However, some are large and worrying.</span></li><li><span>Finally, IT systems can be attacked by hackers that useransomware, This is where the control of a computer islost to a hacker. The only way users can get back controland recover all their stolen files is to pay a ransom</span></li></ol>
<p>possible crisises: loss key staff</p>
<ol><li><span>People leave businesses all ofthe time. This may not be a problem but losing keymembers of staff can cause difficulties — especially ifthe business has not prepared well enough for it.</span></li><li><span>It canalso be a very serious problem in small businesses, which are often dominated by a single person. It has been reported in the past that around 55 per cent of businesses would stop trading if they lost one ormore key people, Unexpected losses through illness, long-term incapacity or death are the most commoncauses of such an event.</span></li><li><span>In a small business, wherethe owner employs only a few other people, the loss ofthe owner could result in the closure of the business.This is because the other employees may not have the resources or the desire to take ownership of thebusiness. Finding an outsider (i.e, somebody who is notalready part of the business) to take over the business might also be difficult.</span></li></ol>
<p>What is a Business Continuity Plan?</p>
<p>- whwen an incident occurs, a business will want to minimise disruption, after safeguarding human life, on of the most important priorities is to get the business 'up and running' again
<br></br>- Some firms produce business continuity plans, these show how a business will operate after a serious incident and how it expects to return to normal in the quickest time possible, there are four stages:
<br></br>1 - Carry out a business impact analysis
<br></br>2 - Formulate Recovery Stategies
<br></br>3 - Plan development
<br></br>4 - Testing and Training`</p>
