Comprehensive Business Continuity Management Press the “Page Down” button to Advance the Slides

What is Business Continuity Planning? * 07/16/96 What is Business Continuity Planning? Planning to ensure the continuation of operations in the event of a catastrophic event. Business continuity planning goes beyond disaster recovery planning to include the actions to be taken, resources required, and procedures to be followed to ensure the continued availability of essential services, programs, and operations in the event of unexpected interruptions. *

It’s Not Just a Technical Problem Business Continuity Management is not just a job for your IT team - it is an operational issue. A team effort is required to develop comprehensive plans for critical operations including not just computing processes but also operational, building systems, suppliers, and other processes.

Risk Management Process Identification Assessment Control Transfer Finance

Business Continuity Plan * 07/16/96 Business Continuity Plan Identify Risks - Triage to assess all processes All business functions EDI/EBD Suppliers Infrastructure Develop Plans for Everything Test and Exercise the Plans Layer Business Plan & Disaster Plan *

Business Continuity Issues Biggest Risk is not knowing all the risks Biggest Problem - much risk is out of your control Best Practices? Business Impact Assessment Contingency Plans Disaster Planning Business Recovery

Create a Business Continuity Management Team Lead by Top Management Project BoD Monitors Regular Status Reporting to Management Broad-based Awareness for Everyone Key Players Senior Officials Internal Audit Risk Management Legal Finance/Budget Procurement Safety Others?

Key Components of BCP Assess - identify and triage all threats (BIA) Evaluate - assess likelihood and impact of each threat Prepare – plan for contingent operations Mitigate - identify actions that may eliminate risks in advance Respond – take actions necessary to minimize the impact of risks that materialize Recover – return to normal as soon as possible

Project Reporting/Tracking * 07/16/96 Project Reporting/Tracking Complete data repository Use summary reports for management Measurable and quantifiable progress Risk rating Prioritization Regular reporting (weekly or bi-weekly) Sort on priority, progress, time-to-completion *

Process Inventory and Triage The purpose of the BIA is to: * 07/16/96 Process Inventory and Triage The purpose of the BIA is to: Identify critical systems, processes and functions; Establish an estimate of the maximum tolerable downtime (MTD) for each business process Assess the economic impact of incidents or disasters that result in a denial of access to systems, services or processes; and, Determine the priorities and processes for recovery of critical business processes. *

BIA Review Factors All Hazards Analysis Likelihood of Occurrence Impact of Outage on Operations System Interdependence Revenue Risk Personnel and Liability Risks

Prioritize Risk Factors Personal Safety Risk Services Risk Operational Risk Revenue Risk Liability Risk Good Will (Societal) Risk

Risk Analysis Matrix Area of Major Concern High Medium Low Low Medium Probability of Likelihood Medium Area of Major Concern Low Low Medium High Severity of Consequence

Risk Rating Methodology BCP Risk Rating Methodology Risk Risk Numeric Explanation Factor Rating Score Degree of H 8 Process must function for core operations Organizational M 6 Process required for daily settlement Dependence L 3 Process is not critical to daily operations Probability H Probability > 0.5 that alternative process will work of Successful M 2 Probability < 0.5 that alternative process will work Alternative L 3 No plans for alternative process Dependence H 5 Business functions depend highly on process on M 3 Business functions depend somewhat Automation L 1 Manual operation possible w/o penalty Criticality of H 4 Critical business function - core process Business M 2 Secondary line-of-business Process L Not a critical process

Risk Assessment Matrix * Risk Assessment Matrix 07/16/96 *

What Are External Risks? External Risks are risks presented by factors outside the enterprise; these include risk present in natural disaster, labor strife, the possible failures of business partners, suppliers, public utilities, transportation, telecommunications, and other businesses.

Risk Areas Risk Threat Areas High External Factors Low Infrastructure Applications Low Threat Areas

Review External Dependencies Infrastructure Dependence (power, telecom, etc.) System Up Time (computing, data,networks, etc.)

One Business Failure Can Shut You Down If you rely on one supplier for a critical part or service, the impact of their non-compliance could be catastrophic. Examples: GM Parts Manufacture strike in 2 plants shuts down assembly line in 54 plants Satellite snafu impacts millions of customers UPS strike hurts many using “just-in-time” Railroad computer problems hit shipping

Infrastructure Issues What will we do if there is not power? No phone service? No Water? Will government open? How will the public react?

Emergency Management Planning Work with local and regional disaster agencies Assess special problems with disasters Loss of power, communications Supply-chain impacts Review and revise existing disaster plans Look for new areas for disaster plans Include Disaster Recovery Planning

Contingency Planning

Contingency Planning Issues Power and Telecommunication Failures System Failures Natural Disasters Local Emergencies Workplace Violence Supply Chain Disruptions Public Response to Crisis

Contingency Planning Process Phases Assessment - organizing the team, defining the scope, prioritizing the risks, developing failure scenarios Planning - building contingency plans, identifying trigger events, testing plans, and training staff on the plan Plan Execution - based on a trigger event, implementing the plan (either preemptively or reactively) Recovery - disengaging from contingent operations mode and restarting primary processes of normal operations by moving from contingency operations to a permanent solution as soon as possible.

Develop Scenarios How bad will the “big one” be? Extended Power, Water, or Telecom Outages? Supply Chain Disruptions? Civil unrest? Develop various scenarios and pick which ones to plan for.

Evaluating Alternatives Functionality - provides an acceptable level of service Practicality - is reasonable in terms of the time and resources needed to acquire, test, and implement the plan Cost Benefit - cost is justified by the benefit to be derived from the plan

It’s Not Enough Just to Plan * 07/16/96 It’s Not Enough Just to Plan Use focus groups and brainstorming Seek “what can go wrong” Find alternate plans & manual work arounds Find innovative solutions to risks Contingency plans must be exercised Hold table top exercises for disasters Conduct “fire drills” of plans Train staff for action during emergencies Constantly assess your project *

Contingency Planning Phases Trigger Event Occurs Execute Plan Execution Event Ends Activate Recovery Plan Recovery Develop Plans Planning Identify Event Triggers Develop Scenarios Conduct Risk Assessment Risk Scoping & Prioritization Assessment Test Plans Organize Risk Assessment Team Train on Plans

Risk Management Formula * 07/16/96 Risk Management Formula Best Practices Risk Assessments + Contingency and Recovery Planning Validation and Training Due Diligence Good Business Judgement *

For More Information Steve Davis, Principal DavisLogic POB 394 Simpsonville, MD 21150 www.davislogic.com Steve@DavisLogic.com