Business Continuity Plan and Disaster Recovery: Why Both Are Important?
author: Krzysztof Kaczor, COO, A4BEE
Hardware failures cause 45% of total unplanned downtime. This is followed by the loss of power (35%), software failure (34%), data corruption (24%), external security breaches (23%), and accidental user error (20%)
According to Datto, “An hour of downtime costs £6,038 for a small company, £55,851 for a medium company, and £528,325 for a large enterprise.”. In addition to that, downtime costs have risen 32% in the past 7 years.
According to figures from Seagate, 22% of downtime events are caused by human errors, including inadvertent data loss, device mismanagement, and other accidents. Seagate found that only 5% of business downtime is caused by natural disasters.
Those numbers and amounts make me think that many business leaders do not have a good understanding of business continuity plans and disaster recovery plans.
Business continuity refers to an organization’s capacity to keep critical processes running during and after a crisis. Business continuity planning sets risk assessment methods and procedures with the goal of preventing disruptions to mission-critical services and restoring full organization operation as fast and easily as feasible.
A disaster recovery (DR) plan, on the other hand, is a formal statement developed by a company that gives precise instructions on how to deal with unanticipated situations such as natural calamities, blackouts, cyber-attacks, and other disruptive events.
What is a Business Continuity Plan (BCP)?
Business continuity planning (BCP) is the method of developing a strategy for preventing and recovering from possible hazards to a business. The strategy guarantees that workers and assets are safe and that operations can resume rapidly in the case of a calamity.
The most fundamental requirement for business continuity is to maintain critical functions operational during a crisis and to restore itself with minimal disruption as possible. Natural catastrophes, fires, disease outbreaks, cyberattacks, and other external hazards are all included in a business continuity strategy.
Why do Companies Need Business Continuity Plans?
BCPs are an essential component of every organization. Threats and interruptions result in revenue loss and greater costs, resulting in a decline in profitability. And companies cannot rely solely on insurance since it does not cover all costs and consumers who defect to the competition. Moreover, it is usually planned ahead of time and involves important stakeholders and employees. Although business continuity is critical for firms of all sizes, it may not be feasible for any but the largest enterprises to sustain all services during a crisis.
Businesses are vulnerable to various disasters ranging in severity from small to catastrophic, and BCPs are an essential component of every firm. BCP is generally intended to assist a corporation in continuing to operate in the face of risks and interruptions. This might result in revenue loss and increased expenditures, resulting in a decline in profitability. And companies cannot rely solely on insurance since it does not cover all costs and consumers who move to the rival.
Businesses are vulnerable to various calamities ranging in severity from minor to catastrophic. Business continuity planning is often intended to assist a firm in continuing to operate in the case of a significant calamity, such as a fire. BCPs differ from disaster recovery plans as such that they focus on the recovery of a company’s IT system following a crisis.
What is a Disaster Recovery Plan?
A disaster recovery plan (DRP) is a documented strategy and/or method that assists an institution in implementing recovery processes in times of emergencies to protect a business IT architecture and, more broadly, promote recovery. A disaster recovery plan is more targeted than a business continuity plan and may not cover all scenarios for company operations, assets, human resource management, and business associates.
An effective disaster recovery solution often handles all sorts of operational disruption, not simply large natural or man-made calamities that render a place inoperable. Power outages, communication system failures, temporary denial of access to a building due to explosives threats, potential fire or a minimal non-destructive fire, flood, or other incident are examples of disruptions. A disaster recovery plan is usually set in place by the type of disaster and location. It must have scripts (instructions) that anyone may follow easily.
Why Do Businesses Need a Disaster Recovery Plan?
Technology supports almost every aspect of a business; nevertheless, the more we rely on our tools, networks, and apps, the more we stand to lose if they collapse. That is why every organization has a disaster recovery (DR) strategy in place to swiftly restore and replace IT systems in the event of a breakdown.
A disaster recovery plan’s goal is to minimize damage or interruption and recover as rapidly as possible in the case of a disaster that causes system failure. Therefore, a recovery time goal (RTO) and a recovery point objective (RPO) are two fundamental components of most disaster recovery plans (RPO).
The RTO is the amount of time it takes to restore systems following an outage, which impacts how long it takes to restore business activities. The RPO exposes how frequently a backup is required by establishing a time frame for how long the firm can tolerate data loss.
Why are Both a BCP and DRP Essential for Business Sustainability?
Natural disasters such as hurricanes, storms, fires, cyclones, and earthquakes, as well as man-made disasters such as espionage and cyberattacks, can be detrimental to company operations. For example, following the pandemic, corporations had to adjust to a situation where many of their workers had to work remotely. Despite the early challenges, the majority were able to move to arrangements that permitted them to function in this new climate. This was especially true for firms that already had business continuity and disaster recovery policies in place. This emphasizes the significance of a BCP and DRP.
As demonstrated by firms’ reactions to the pandemic, BCPs and DRPs help reduce the impact of calamities on business operations. Companies are better equipped to deal with catastrophes when and after they occur with the support of a successful BCP and DRP.
BCPs and DRPs are complementary — you must have both to handle operational issues caused by catastrophes. Because of their tight link, they are frequently referred to as BC/DR or business-continuity/disaster-recovery.
- 51% of companies have no plans for how to address this type of emergency.
- 75% of small businesses have no disaster recovery plan objective in place.
- 93% of companies without Disaster Recovery, who suffer a major data disaster, are out of business within one year.
The BCP includes a DRP that is ready to act when an organization is hit by a disaster. During a crisis situation, companies can use either the BCP or the DRP, or both, depending on the situation. These two concepts of BCP and DR are frequently seen as interconnected; while they are not quite the same idea, they do overlap in certain areas and function best together when created concurrently.
Both are preventative strategies that help organizations prepare for unforeseen, catastrophic events. Rather than reacting to a disaster, both take a proactive approach, seeking to reduce the effects of a disaster before it strikes.
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