Protecting your Business
Why an effective Business Continuity Plan
is crucial in Northern Ireland
We never know what is around the corner- recent times have shown us just how unpredictable life can be, with era-defining events such as Brexit, Covid and the war in Ukraine, all respectively remapping the financial and political landscape, altering the way we work, disrupting supply chains and driving up costs, resulting in high inflation and the cost-of-living crisis.
The presence of cyber-attacks on businesses, infrastructure and industries is ever present with many businesses being targeted by ransomware attacks, effectively seeking to lock those businesses out of their systems.
The impact of these events on businesses has been massive, forcing them to adapt, as old certainties and ways of doing things are completely overturned. Businesses that have managed to ride out these turbulences, and even capitalise on new opportunities, often have one thing in common: an effective and comprehensive business continuity plan (BCP) to help them weather any storm.
So what does a good Business Continuity Plan look like? What aspects should it cover?
In this feature, Partner Max Nesbitt, outlines what you need to consider in order to ensure your business can cope with any risk and potential disruption that the future might hold.
What do you need to consider & include in a business continuity plan?
In order to protect your business, it’s important that you take proactive steps to ensure that it can cope with predictable as well as unforeseen risks and disruptions – what Donald Rumsfeld coined “the known unknowns and the unknown unknowns”.
Here in NI, we face some unique challenges due to our history, political situation and border with the European Union. By creating an effective and comprehensive BCP, you can prepare for and respond to various disruptions, including political, economic, cyber and environmental challenges.
Max outlines five key strategies that you should focus on to develop your BCP and set your business on a course to continued success.
1- Map out the Potential Risks
A thorough risk assessment is a crucial part of any BCP: in order to mitigate against potential risks, you first have to identify them and how they might impact your business.
Identifying potential risks specific to your business, as well as within the sector in general and the wider operational environment: are there any risks in terms of your cash flow? Are you overly reliant on one or two major clients? Are there any potential regulatory changes to your industry? Can your infrastructure cope with sudden change? Is your data backed-up to mitigate the risks of a cyber-attack? Do you have appropriate insurance coverage?
Once you have identified the risks, it is essential to develop risk-mitigation strategies so that you have a clear plan of action in place if one or several of these risks materialise
You shouldn’t be afraid to use risk assessment tools and seek out expert advice where necessary.
2 – Keep your Finger on the Pulse
It’s important that your BCP includes strategies for keeping up to date with developments in your sector and the wider world.
Subscribe to and read the relevant trade journals; build strong relationships with industry peers, government agencies, and trade associations; collaborate with other businesses to share resources and best practices for coping with disruptions; and generally ensure that you remain alert to any pending changes in your business environment.
This includes any amendments or innovations in the area of compliance and regulation: it is crucial to know about any regulatory changes, especially those related to trade, taxes, and customs, in good time so that you can react in good time and ensure your business complies with all the relevant regulations and thereby avoid any penalties and disruptions.
Staying up to date also means embracing technological developments, IT security and digital transformation– businesses that fail to keep pace with advances in IT in particular can soon be left behind by their competitors.
You should therefore put effective strategies in place for regularly reviewing and upgrading the technology your business uses in order to further streamline operations, improve efficiency and adapt to changing market conditions.
3 – Make sure your Business is Financially Resilient
Should the unforeseen happen, it’s important that your business has the necessary financial reserves to weather the storm.
If you haven’t already done so, you should consider how you would deal with any sudden capital demands that will allow you to ride out any disruptions that result in reduced revenue or increased expenses.
This could include building up a reserve or maintaining an overdraft facility but without forethought it may be too late when it becomes necessary.
4 – Train your Team to Prepare for the Unexpected
When the pandemic hit, businesses globally had to rapidly adapt to fundamentally altered working conditions – not just the lockdowns, but also staff shortages as employees fell ill with Covid.
To build resilience within critical employment positions, you should ensure multiple staff have basic levels of understanding across those critical employment positions with appropriate manuals and access to any necessary accounts..
It is also recommended that remote-working capabilities where possible and appropriate, are an effective means of mitigating against some risks.
Lastly, having an effective communication plan in place is critical during any disruption. This should include both internal and external stakeholders, and provide as much clarity as possible about the specific circumstances and what to expect going forward.
5 – Manage your Supply Chain
Supply chains have been disrupted by many unforeseen factors over the last 3 years and have still not fully recovered.
It’s important to find ways of diversifying your supply chain so that your business is not overly reliant on a single source, especially if that source is located in an area prone to disruptions such as war, border delays or changes in trade agreements.
Here too, it pays to remain informed about political developments, both domestically here in Northern Ireland, and abroad. You don’t want to be blindsided by changes in regulation or political instability that make vital imports considerably more expensive or difficult to procure.
Where possible, it’s a good idea to develop relationships with local suppliers to ensure a backup source in case of any disruptions.
By following the five strategies outlined above when developing your BCP, you will put your business on a sound footing for the future and any unpleasant surprises it may hold.
It’s important to remember that every business is different, and that a BCP is therefore not a one-size-fits-all solution. Instead, your BCP should be tailored to your specific business and the unique challenges it faces.
Once you have created it, you cannot afford to lock it away in a drawer and forget about it. You will need to regularly review your BCP and revise it to fit the changes conditions and needs of your business. By doing so, you can ensure that it remains effective in safeguarding your business operations.
Get in Touch
Max and our Corporate team act and advise a broad portfolio of Business owners across Northern Ireland, offering them joined-up, holistic legal advice on strategic and practical issues affecting all stages of their businesses lifecycles- from SME start-ups to Expansions, Mergers and Acquisitions.
If you require advice get in touch; 02890323864 or make an email enquiry.