December 08th, 2016
Businesses can, and most likely will, encounter a variety of threats to normal operations, interruptions ranging from minor equipment failures to catastrophic natural disasters. In fact the frequency of severe weather-related events is increasing. In 2016 in the United States alone, 12 weather disaster events have been recorded with losses exceeding $1billion each – and with three months left in the year. This figure also represents the second highest total number of events in a single year since such record-keeping began in 1980.1 In France this spring, torrential rains closed freeways and caused evacuations of schools, medical centers, retirement homes and prisons. And in Paris, where the River Seine rose 20ft (6.1m) above normal and reached a 34-year high, floods closed part of the metro system, major landmarks and bridges. Still, it does not take a major natural disaster to shut down a business. With companies often relying on complex supply chain networks or running 24/7 operations, even minor disruptions or a single downtime event – power failures or computer data loss – can be financially devastating.
Of course there is no way to prevent calamities, but companies can prepare for and minimize the risks associated with them. Formally this preparation includes a Business Continuity Plan (BCP) – a strategy based on recognized threats and the actions required to ensure operational continuity in the face of disruption. A key component of a successful BCP is that multiple sources are identified and available for critical supplies and processes.