Business continuity efforts 'haphazard and untested'

A study by the Cabinet Office and the Chartered Management Institute (CMI) revealed that only 47% of organisations across the UK have a business continuity plan – a figure that has barely changed since 2002 (45%).

Public sector organisations were most likely to have a plan (62%) compared to 55% of listed companies and only 40% of private and voluntary organisations.

The CMI said the low level of protection was "surprising" and suggested organisations were still only paying lip service to contingency planning.

Hard questions

Worryingly, those organisations that had a business continuity plan in place were "haphazard" in their approach, according to the Cabinet Office/CMI report.

Only 29% addressed the potential loss of people, even though 35% had experienced disruption as a result of this in the past year. Also, only 39% of organisations focused on loss of technology, despite 73% suggesting that "IT downtime" would have a significant impact on costs and revenue.

CMI director, Jo Causon, commented: "Some hard questions need to be asked about why the mismatch between planning and protection is allowed to exist.

"It doesn’t matter whether the turbulent times we face are caused by economic or security concerns - the simple fact is that failing to provide safeguards for business operations does not make sense. The ability to manage risk is a critical skill and unless it is taken seriously businesses and jobs will remain at risk."

Lessons to learn

Although the report said there was some improvement in business continuity planning, a third (33%) of organisations with a plan still did not carry out any kind of exercise to test its effectiveness.

A high proportion (78%) of those that did conduct an exercise at least once a year said shortcomings had been revealed, enabling them to make improvements.

The report also suggested that staff training relating to business continuity plans remained limited. Just over a third (35%) of those with a plan included business continuity training on induction courses - up from 30% in 2007.

Bruce Mann, director of civil contingencies at the Cabinet Office, said: "Too many organisations still do not have effective business continuity arrangements in place. This view is echoed by the findings from Sir Michael Pitt's review of the 2007 floods.

"It is bad news for employees, shareholders, customers and communities. Lessons need to be learnt, and acted upon, to strengthen business and national resilience, as a whole."

The joint Cabinet Office/CMI report entitled 'Business Continuity Management 2008' is available on the CMI's website - link above/right.

'Business resilience - A guide to protecting your business and its people' is a 12 page introduction to preparing a business continuity plan, and is available free of charge from Norwich Union Risk Services. Click here (1.3MB pdf).