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What is the value of a business continuity plan?

A lot of business see business continuity planning as an outgoing without any tangible return.

Below are a few things to take into consideration if corners are cut in the planning process. 

Here is a very real situation:


Your workplace has a burst pipe on the floor above your data center (DC); this happens overnight and isn’t picked up until first thing in the morning potentially meaning water has been leaking onto the floor above for over 12 hours. It’s now starting to penetrate the DC celling directly onto critical IT equipment.

Your building is out of action as the offices have standing water on the floor and the celling is unsafe and potentially so too is the floor/ceiling below… staff can’t come to work.

IT is under threat from the water coming from above but at 9am is still functioning. The flow of water to the faulty pipe has been stopped but you still have the gallons of water above to deal with let alone the risk of the ceiling falling in.

Should the worst happen and the IT is then taken out from one of the aforementioned risks and staff can no longer work remotely (even if this was an option in the first place). What would your business do and how long would it be before staff were back working?


This formula should give you a good idea on what ‘value’ a business continuity contract offers.  

First of all your fixed costs:

  • Staff Salaries

  • Utilities

  • Rent & Rates

  • Contractual Obligations - telephony, computing, insurances etc


Regardless of your business’ ability to operate these have to taken into consideration, how much is that per day, week, month?


 Now the following costs are the knock on of the disruption:


  • Costs of Rework such as updating systems, administration backlogs caused by disruption

  • Costs of Failing to Fulfil Undertakings Given

  • Increased Insurance Costs

  • Contractual Penalties from Work Undertaken

  • Regulatory Penalties


Finally and a potentially fatal impact of a serious disruption to your business is damage to your business’ reputation.


  • How long do think your customers would wait before being forced to find and alternative supplier? Could you rely on them coming back? How would that affect future revenues?

  • Are there any contractual liabilities related to service level agreements?

  • Would your current sales pipeline be impacted by the incident?



What does a 1%, 5% or even 10% loss of annual revenue do to your business?


How much has that burst pipe just cost your company?


  • Steve Dance Managing Partner
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