Business Continuity for SMEs

tie-690084_640The term business continuity is something that you’re likely to hear a lot if you work for a large organization. It’s defined by the BCI (Business Continuity Institute) as an organization’s “ability to continue the delivery of products and services” after “a disruptive incident”. What this means, essentially, is that there’s usually an entire team within a large company whose job it is to identify various scenarios (even if they’re unlikely ones) and work out the ways in which the company would react were they to happen.

For big businesses, this type of contingency planning puts a lot of focus on things like earthquakes, hurricanes, significant outbreaks of contagious disease, and so forth. And while it might seem counterintuitive to invest in contingency planning, it’s also the case that the companies best placed to deal with unexpected adverse conditions are also the most likely to pull through, should any of these things happen. In many ways, it’s a form of insurance.

While the big businesses have a budget for this kind of thing, it’s unlikely that the same proportion of small businesses have the resource to employ staff dedicated to the purpose. And it’s also worth pointing out that business continuity within a multinational addresses a different set of outcomes than for one whose territory may only be a few hundred miles in scope, or simply have just one standalone office.

However, this doesn’t mean that contingency planning should be outside the reach of SMEs. It just means that there are different scenarios to deal with. Some of the key points for SMEs to consider include the following:

Staffing. The fewer staff a business has, the bigger the impact when someone is ill or otherwise unable to make it into work. This is of course especially important in the case of sole trader businesses.

Premises. If you rent (or even own) the property, there can be unforeseen events where things change fast. Depending on local laws, in some locations even owning a property doesn’t mean it’s yours forever – for instance when a compulsory purchase order takes place. This can happen when a local authority wants to build infrastructure and is able to buy all the land that the proposed project will occupy. And although property owners will be compensated, there’s still the logistical challenge of relocation.

Compensation. Small mistakes can have unexpected impacts – and lead to expense. For instance if your business provides advice, and that advice was flawed in a way that ended up with the client losing money, your business could be liable. For contractors (e.g. plumbers) working on a customer’s premises, liability insurance covers accident claims which can run into the tens of thousands. There’s a list of examples here, such as contractors accidentally putting a nail through a pipe.

Information security. Data is an ever-increasingly important part of business life. And there are plenty of stories about the scenarios that small businesses have had to deal with. This article provides a good overview of the things to consider.

Industry changes. We live in a world where ‘disruptive’ technology has far reaching effects in many industries. Book and music retailing has been transformed by the internet, while apps like Uber are changing the face of the taxi business. While changes within your industry may provide an element of challenge, there are also likely to be opportunities. Including industry changes within your planning can help you to identify these and make adjustments to your business as you move forward.

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