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What is a business continuity plan?

3-minute read

Business colleagues having an annual general meeting
Catriona Smith

Catriona Smith

11 February 2022

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What is a business continuity plan and why do you need one? Even as a small business, it’s vital to know the steps you’d follow if you’re faced with a crisis.

By assessing the risks and planning your response, you can help keep your business running (or get back on track as quickly as possible) in the event of a disaster.

Here’s how to write a business continuity plan.

If the Covid-19 pandemic showed us anything, it’s just how much something outside of our control can impact our way of life. As people began working from home and areas of society were forced to shut down, it was the businesses that pivoted (restaurants turning into takeaways, for example) that proved they could adapt and keep operating despite events going on around them.

That’s where a business continuity plan comes in.

What is a business continuity plan?

A business continuity plan is an important document that details how you’ll keep your business going in the event of disruption or a disaster. This could be anything from floods or a fire to a cyber attack, utility outage, financial crisis, or a pandemic.

You might also find a business continuity plan useful if a supplier fails to deliver, a client doesn’t pay, or if key employees are off sick or resign.

Assessing all the potential risks to your business – and having a plan for how to adapt and respond to them – is a key feature of a business continuity plan. By outlining your response, you (and your staff) will know exactly what to do if there’s an emergency.

Insure your business against the unexpected

Make sure you’re covered if the worst should happen.

Business interruption insurance can cover you if an incident happens that means you have to stop trading for a period of time.

Business buildings insurance can cover you if your business premises (including home businesses) is damaged or destroyed.

You may also want to organise stock cover if you’re storing stock on your business premises. Any damage or theft could leave you struggling to meet client orders – and get paid.

How to write a business continuity plan – step-by-step

While the risks will vary depending on industry and the size of your business, a business continuity plan usually covers:

  • potential risks and impact on your business
  • roles and responsibilities – who’s responsible for what?
  • how you’ll respond to different scenarios – what needs to happen, and when?
  • an internal and external communication plan

Follow the checklist below to make sure you’re looking after your business and that you have a strategy for when things don’t go to plan.

1. Risk assessment and business impact

What are the risks and how could this impact your business?

As well as the environmental disasters and crises related to technology and security mentioned above, think about any potential internal challenges too. What happens if you face problems with cash flow? What about if you lose a key member of staff?

Next, think about how your potential risks could impact the following areas of your business, and how you’d manage them:

  • premises
  • people (customers, employees, partners, suppliers)
  • stock and equipment
  • operations and processes
  • technology (IT, equipment)

When reviewing the risks, you should also assess how likely each risk is to happen and add a timescale for a resolution to be found.

It can take some time to explore all the possible risks to your business, but it’s an important part of business strategy and shouldn’t be overlooked.

2. Identify critical functions

If the business could fall apart if something doesn’t get done, then that’s ‘business critical’. You’ll need to document this and highlight how you can mitigate any risks around it.

Let’s say you’re the owner of a craft business and bad weather causes issues with your supply chain, meaning some of your products won’t get delivered. This could affect your ability to meet client orders. To mitigate the risk, your plan could identify back-up suppliers and remind you to do a stock take regularly.

3. Roles and responsibilities

If you’re a larger business, then your business continuity plan should include a list of key people and their contact details. You should also document roles, and clarify additional responsibilities if an emergency process was to kick-in.

Even if you’re a sole trader without employees, including a list of key contacts like utility companies and suppliers can be a useful reference to include in your plan.

4. Communication and emergency response checklist

You’ll want to create an emergency response checklist that outlines the actions your business needs to take in the hours and days after an emergency event.

Part of this will involve creating a communication plan, which will save you time and be one less thing to think about during a crisis. This could simply be an outline of who needs to be kept updated, for example letting your customers know if your order processing time may take longer while you deal with an issue.

You might also find it useful to draft press releases, emails, and social media posts in advance.

The challenge is making sure you get the tone right. Showing empathy to customers and communicating in a clear and timely way will help you maintain good customer service.

5. Test and review

Finally, it’s important to make sure that your plan works before you have to use it. Test each stage of your plan, train your staff (if you have any), and develop and add to it if anything is unclear.

While you’ll always hope you never need to use this plan, it’s like business insurance, it’s there to protect your business. That’s why it’s important to review it regularly so it’s up to date and can be relied on in an emergency.

Have you got a continuity plan for your business? Let us know in the comments.

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Catriona Smith

Written by

Catriona Smith

Catriona Smith is a content and marketing professional with 12 years’ experience across the financial services, higher education, and insurance sectors. She’s also a trained NCTJ Gold Standard journalist. As a Senior Copywriter at Simply Business, Catriona has in-depth knowledge of small business concerns and specialises in tax, marketing, and business operations. Catriona lives in the seaside city of Brighton where she’s also a freelance yoga teacher.

We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer

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