Business continuity plan (BCP) 101

Say a huge storm rips through the area in which your business operates, bringing down trees and powerlines — and leaving your business without power for at least a week. No electricity, no internet, no coffee, nothing. The interruption to your business may be temporary, but it could still be devastating if you can’t keep operating.

It’s time to activate the business continuity plan.

For many businesses, continuity planning is far down the to-do list. They may think it seems daunting – or that ‘it’ll never happen to me’. Nobody wants to think about bad things happening to their business, but they can and do. So it’s important to have a well-executed business continuity plan, or BCP, in place. 

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What is a business continuity plan (BCP)?

A business continuity plan, or BCP, is a document or series of documents detailing how your business will keep operating after a disruptive event. Such events may include:

• weather-related natural disaster
• fire
• water damage (burst pipe or running tap)
• building access prevention (gas leak in the area) or;
• a burglary. 

What’s the difference between a business contingency plan and a business continuity plan?

A business contingency plan details how your business will respond to unexpected events, such as a storm cutting off the electricity supply, or a fire.

The business continuity plan is part of the contingency plan – but only used as a temporary measure until the business can once again run at its usual capacity. 

Why is it important?

A BCP is a clear and practical way to ensure you and your team can operate after a business interruption. As everything’s been decided ahead of time, there are no rushed decisions or knee-jerk reactions which may prove detrimental later. Writing a BCP also helps identify, manage and even prevent risks and exposure, especially those previously over or underestimated.

Five key business continuity planning steps

1. Identify and analyse the risks

• Create a comprehensive list identifying all the risks likely to impact your business.
• Be as thorough as possible. Don’t leave anything out.
• Analyse the risks, grouping them together when it's logical to do so. Categories could include things like time impact, financial impact, lower service levels, and so on.

2. Prioritise and assess the risks

• This kind of assessment is sometimes known as a Business Impact Analysis (BIA) and will help define critical business activities.
• Look at the likelihood of events happening and the impact they’ll have on your operations.

3. Draft and develop the plan

• Figure out where you’ll draw the line, as you can’t plan for every little thing.
• Communicate with key people within your business.
• Draft a response plan. Make sure the safety of your people is the first priority.
• Ask for and address stakeholder feedback. Allow time for revisions.
• Be sure to include ‘after the event’ plans such as counselling or other support, if needed.

4. Distribute the plan

• Distribute the plan widely within your business. The plan is only useful if people know about it.
• Ask for and address any feedback from employees.
• Keep hard and digital copies, as appropriate, easily accessible.

5. Monitor, maintain and update the plan

• Test your plan. It’s the only way to see if it’ll work.
• Make sure your employees know what’s expected if the plan is activated.
• Monitor the plan and keep it updated. Don’t set and forget, especially contact details or wider community emergency responses.

Creating a clear, practical and actionable BCP is the first step in the business continuity process.

Should the unexpected happen and you need to activate your BCP, it’s good to know your Business Insurance policy has the flexibility to help get you back to business as usual, as soon as possible.

Jump online to get a GIO Business Insurance quote anytime, or call us on 13 10 10 during our contact hours for more information.

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Read more:

• The different types of Business Insurance
• Why do I need Workers Compensation Insurance?
• What does Tradies Insurance cover?

Insurance issued by AAI Limited ABN 48 005 297 807 trading as GIO. Read the Product Disclosure Statement before buying this insurance. Go to gio.com.au for a copy. The Target Market Determination is also available. This advice has been prepared without taking into account your particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it. This information is intended to be of a general nature only. We do not accept any legal responsibility for any loss incurred as a result of reliance upon it – please make your own enquiries.