Why do some businesses manage to succeed despite potential threats and disruptive events, while others fail? The answer lies in business resilience. Here's how to create an appropriate business resilience plan to be prepared for emergencies and unexpected events
What is Business Resilience Planning?
Business resilience does not describe a state, but rather a dynamic capability of companies to react and adapt to new challenges and find appropriate solutions on an ongoing basis. The Covid-19 pandemic, the Ukraine conflict, and cyber-attacks all demonstrate the importance of business resilience today. A multitude of factors contribute to strengthening business resilience in different organisations.
Basics of Resilience Planning
Business resilience is the combination of various measures such as business continuity, disaster recovery, crisis management, risk management, and incident response planning. The basis is a business resilience plan or a business continuity pan. A business continuity plan is the basis for how a company will maintain operations during a crisis or other exceptional circumstances. It includes a detailed strategy for preventing a sudden business interruption and disaster recovery strategies. The business resilience plan goes one step further than the business continuity plan. It covers not only business recovery, but also post-disaster strategies.
Contents of a Business Resilience Plan
The business resilience plan originally evolved from the disaster recovery plan. However, the former is more comprehensive and contains guidance for different areas of the business.
Disaster Response in the Event of a Disruption
The business resilience plan includes, for example, general business processes, product manufacturing, human resources, supply chain resilience, cybersecurity resilience and financial stability - in other words, contingency measures for every aspect of the business that a crisis will impact.
After a Disruption: The Business Continuity Plan
Business continuity planning includes a checklist of instructions, processes, tools and resources for recovery from a business interruption. These strategies cover both short-term and long-term outages. In addition, managers designate responsible parties and key individuals for business continuity planning.
Why is Business Resilience Planning Important for Companies?
Risks can be contained, but they can never be completely predicted or eliminated. A company that does not have crisis management in place risks longer downtimes and thus financial losses. In case of serious events, the financial damage without continuity planning may be so fatal, that a company is threatened with insolvency. Furthermore, the competitiveness, customer loyalty and ultimately the success of a medium-sized company depend on a quick recovery after an outage. Winners are companies that effectively overcome negative challenges and emerge even stronger from the crisis. They benefit from an improvement in their reputation, market value and customer confidence.
The importance of business resilience has increased significantly in recent years. Faced with disruptive events, political unrest and conflict, more and more companies need to develop a business resilience plan. But how do companies identify which crises are actually a potential threat? Find out how other companies of the same industry and size are identifying risk factors and building resilience in Dun & Bradstreet's report.
How to Create a Business Resilience Plan
The key steps in creating a business resilience plan are as follows:
- Define responsibilities: Companies initially establish how the organisation should function in an emergency. They identify a team of decision makers and a hierarchy to ensure business continuity.
- Describe worst-case scenarios and alternative methods: Managers identify potential threats and perform a risk assessment. In the next step, they define provisional measures to ensure business continuity in the event of failure. They also determine which processes have priority and who will oversee their monitoring. These measures need to be regularly updated to reflect the current business processes.
- Establish the communication strategy: Companies determine how they will communicate in the event of a crisis, both internally and externally. A rapid flow of information is critical, especially in an emergency.
- Test and implement: After completing the business continuity planning, those responsible test the plan using simulations. This way, they uncover possible weaknesses and continuously improve the business continuity plan. Security training prepares employees for emergencies.
- Post-crisis measures: The business resilience plan also specifies how the organisation should function after the event and what lessons can be learned.
Benefits of a Business Resilience Plan:
- Minimises risk to life, health, and safety of employees
- Reduces financial impact
- Improves corporate reputation despite disruption
- Minimises the risk of business interruption
- Facilitates faster recovery from an incident
Risks of not Having Business Resilience Planning :
- Significant financial loss
- Damage to the organisations reputation
- Hazards to life, health, and safety of employees
- Inability to recover quickly from a disruption
- Significant environmental impact
How Dun & Bradstreet can help you plan
Effective Business Resilience Plan with Data from Dun & Bradstreet
Using timely and relevant data from Dun & Bradstreet, companies can make the right decisions and create an effective business resilience plan. This improves your resilience and prepares you for emergencies.
For example, data makes supply chain and compliance risks visible. You check new and existing customers’ financial stability and adherence to compliance guidelines. You identify gaps in supplier management and thus reduce the likelihood of business interruptions.
- Dun & Bradstreet supports companies in identifying suitable sales channels and offers a solution for building a resilient sales pipeline with the sales intelligence platform D&B Hoovers.
- In the area of finance, credit managers minimise financial risks and increase the efficiency of their company by using D&B Finance Analytics. Information on millions of companies can be found in Dun & Bradstreet's database. The web-based solution D&B Finance Analytics allows users to view key financial figures of business partners worldwide.
- D&B Risk Analytics helps supply chain managers identify risks in their supply chain. This enables them to actively monitor risks, significantly simplify reporting processes and increase operational efficiency.
Learn how to improve your company's resilience in this report with over 3,000 business leaders surveyed. You can download the report for free here.
The following article will also help you to implement business resilience in a meaningful way.