Counting the cost, and benefits, for business continuity - a Micro Business Perspective

This blog looks at Business Continuity Management at the micro business perspective. For those of you wondering what a micro business is well it is at the bottom end of the Small Medium Enterprise (SME) designator that is so often used. This may seem a trivial point but the reality is that most micro businesses will never reach the exalted status of being an upper end SME. This is because such an SME is defined, in EU law, as a business with up to 250 staff and a turn over of €50 million.  To put this into context the same EU law defines micro businesses as having less than 10 staff and a turnover of under €2 Million.

In the UK SMEs are a major employer and a significant part of the economy. This is even more pronounced when you look at it from certain regional perspectives outside of London or other major cities. According to the Federation of Small Businesses (FSB) SMEs account for 99.9% of all businesses in the UK, employ 24.3 million people, cover 59.3% of private sector employment and have a combined turnover of £3,300 billion. Micro businesses play a substantial part in these impressive statistics.

So what is the point? I suppose it is that in the main this seems to be a part of the business environment that is untouched by BCM.  There have been attempts to engage with upper end SMEs but with limited results, we know this from experience. It is less clear that such efforts have extended to micro businesses. Yet such businesses are clearly not immune to business disruptions. In fact they are more vulnerable due to limited resources, including cash and time, as well as extensive competition ready to step in. On a macro scale it has to be acknowledged that the economy as a whole is entirely insulated from the failure of a single micro business and, as the entire sector is unlikely to go under at the same time, that may limit the desire to raise this issue with this aspect of our economy. Alternatively micro businesses are best equipped to implement fully embedded, practical BCM that commands top management buy in, although many owners currently perceive it as an overly bureaucratic process even when offered free support.

Micro businesses form a part of the wider supply chain to top business as well as funding a big slice of their customer base.  It is therefore in the interests of major businesses and the Government, through tax receipts, that micro businesses survive and thrive.  Perhaps as an industry we too now need to look more closely at how we engage with our micro businesses over issues like Organisational Resilience.  A tricky proposition, as it is neither glamorous nor likely to be lucrative, and often the horse, when taken to the water, doesn't want to drink.

Communicating with Employees during a Crisis

In our previous post we looked at some tips for successful crisis communications.  Beverly Lowry rejoins us for this post to look specifically at the importance of communicating with employees during a crisis.  

Whilst many companies have plans in place to communicate with their external stakeholders during a crisis, few seem to have plans for communicating with their employees.  Sometimes, amidst the pressure and urgency of crisis, organisations overlook the importance of communicating internally and too often the focus is solely on dealing with the media and the customer response. 

Communicating with employees during a crisis and afterwards is essential if an organisation wants to work through the crisis with the respect and co-operation of its workforce.  If your organisation is under scrutiny, then unless you talk to your employees and provide them with as much information as you can, you will inadvertently fuel the rumour mill and encourage your employees to rely on other sources of information.

So, a crucial element of your crisis communications plan must be a section about how you will communicate with your employees.  Here are a few things to consider: 

• Plan which channels you are going to use:  Which channel is the fastest and most effective way of reaching your employees?  It may be email, the intranet or employee briefings, or a combination of these, depending on what works best for your organisation.  Don't discount using social media, and ensure the crisis isn't your first foray into that channel.
• Consider how to reach shift workers and those away from base:  Have you got enough managers to hold a short briefing at the start of each shift?  Consider how you will communicate with your overseas workers in different time zones and those based in locations across the UK and Ireland.  Consider also how quickly you can issue internal communications if the crisis occurs out of office hours.
• Leadership: Employees want to see leaders during a crisis.  Some chief executives hold regular employee briefings to explain what is being done about the situation and to answer questions.  This demonstrates leadership and openness and can be useful when dealing with a major issue.  Your senior team should be visible throughout the crisis, talking to and reassuring your people.
• Two-way dialogue: It’s important to address your employees’ concerns during a crisis by providing a forum for people to ask questions and to raise issues.  This can be through face to face briefings, online forums, team meetings, whatever works best for your organisation.  Some of your employees will be at the sharp end dealing with your customers. Informed employees reflect well on your company and they will be better placed to provide good customer service.  As a general rule, it’s very important to issue the same facts internally as externally.  You have to expect that information circulated internally will reach the public domain. 
• Maintain the integrity of your communication: Your communication needs to be accurate and candid.  It’s important to address the difficult issues.  It’s essential that your employees trust your organisation’s information and they will only do so if you demonstrate that you are willing to talk honestly about the situation.  This means being open even when your organisation has made a mistake. 

This two part blog clearly shows that effective crisis communications, both inside and outside the organisation, is a 'must have' capability.  Having a clear and workable crisis communications plan that identifies who you'll talk to, how and with what messages is an essential part of your crisis toolbox.  Develop and resource a communications plan and rehearse it to ensure it is actionable on the day. Your reputation, your staff and your customers deserve nothing less. Our thanks to Bev Lowry for sharing her experience and expertise in this important area. 

Keep an eye out for our future posts on the use of Social Media in managing crises.  Make sure you don't miss out by following our blog, using the links on the right....

Top Tips for Crisis Communication

In a previous post we looked at the top five tips for decision-making during a crisis.  In this post, communications expert Beverly Lowry shares her top five tips for communicating during a crisis.  

Whatever the issue or incident, your organisation’s reputation depends on your ability to communicate effectively. Here are five things to consider.

1.   Respond quickly

• Have a clear call-out procedure to inform the communications representative in your organisation about any major issue or incident.
• Aim to have your first media statement ready within one hour of an incident.
• Nominate and prepare a senior manager to be your broadcast spokesperson.

2.  Get additional resources

• If possible, set up a 24-hour communications response so that your organisation can respond quickly to developing media and social media issues.
• Make sure you have sufficient people to cover all aspects of the communications response, such as, writing statements, answering media calls, managing social media sites and preparing employee communications materials.

3.  Provide regular updates

• Issue regular media statements as the information becomes available.
• Keep your employees, customers and other stakeholders updated each day.

4.  Keep your statements factual

• Make sure your statements are an accurate and factual record of events.
• Don’t speculate about what has happened.
• Don’t be pressurised into guessing the facts.
• Don’t comment about issues that are the domain of regulators or other investigatory organisations.

5.  Provide the same information to all stakeholders

• Keep all internal and external stakeholder groups informed with the same set of facts. What goes internally will go externally.

Keep an eye out for our next post when Beverly shares some thoughts on the importance of communication with employees during a crisis.

Supply Chain Resilience

“No man is an island”, wrote the 16/17^th century English poet John Donne and the same can be said for organisations and nations today. In the world that John Donne inhabited change of significance yet to be appreciated was on its way as nations strove to discover new oceans, lands and trade routes in an attempt to capitalise on their commercial value, including discovering routes to the lucrative spice markets. This struggle pitted established giants, such as Spain and Portugal, against each other but interestingly allowed others, such as the relatively insignificant English, the chance to exploit the weaknesses and misfortunes of the larger nations. Nations that failed to do so or experienced loss in their trading networks became insignificant or were swallowed up.

Ever since then the dependence of nations, societies and people on trading networks has deepened. In the modern era no business survives in isolation and success is often more about how you do things, through those trading networks, than it may be about what you provide. However in other ways, just like 16/17^Th century nations, modern businesses are vulnerable to disruptions to those trading relationships. It may no longer come in the form of buccaneers or gentlemen pirates but, as we have seen recently, age long risks to business and commerce such as volcanoes and tsunamis remain with us. Add to those the modern threats from cyber attacks, power outages or fuel shortages and it may be said we in the 21^st century have as a result more to concern ourselves with. Recently the Business Continuity Institute published its 5^th report into supply chain vulnerability.  Read these findings from that report and consider how they apply to you:

• 75% do not know what their supply chain looks like yet the same amount experienced a disruption in the previous year.

• 42% of disruptions in the supply chain occur in your supplier’s supplier yet they impact you.

• 15% had a disruption that cost over €1M.

• Of those suffering a disruption 41% had customer complaints and 55% lost productivity.

• Roughly a quarter of those experience disruption felt it negatively impacted upon reputation and caused shareholder concerns.

• Major risks reported included severe weather, earthquake/tsunami, fire, currency volatility, terrorism, illness, animal disease, financial pressures, IPR violation, data breach, cyber attack and telephone outage.

Before you run off to build strategies for supply chain resilience you firstly need to appreciate the nature of the problem. If you don’t know what your key services and products are and if you have no idea on the supply chain that enables their delivery then you can’t focus your efforts on where you may be most vulnerable. So use a Business Impact Analysis to inform the selection of the critical supply chain paths as a starting point. Don’t forget to engage with your suppliers as part of the solution. That may be through agreed SLAs or simply by educating them as to your needs/expectations. In those cases where this can’t happen or does not remove the risks then look at alternative plans for gaining access to the goods and services you require. This may require additional or alternative sources to be identified and it may come at a costs. When assessing this make sure you consider the cost of suffering a disruption.

Decisions, Decisions, Decisions!

We’ve been talking on our blog recently about supporting crisis decision making through information management, and attempting to speed up the OODA Loop. On the last post we highlighted the principles of managing decisions and making sure they achieve what you intended them to. This post looks at how to actually take those crisis decisions in the first instance. It is useful to have a decision-making system that is thorough enough to be effective but not so laborious as to induce delay. We also need a process that allows for intuition and experience to play a part but doesn’t allow for sloppy analysis.  The next seven questions are just such a process.

(1) What is the situation and what does it mean to you? - Understand as much about the situation as you can. Don’t ignore aspects just because the information isn’t there or you don’t understand it. Identify your critical information requirements and get them resolved. Once you have a grip on what is actually going on be clear on the meaning for you, your staff and your clients and any other interested parties.

(2) What end state result do I need to achieve and why? Define the end state that you need to reach and why that is the case, that is the unifying purpose behind what you are doing. This will inform and focus the decisions you take. Make sure others are clear on this end state and its rationale, as this will inform their decisions as well.

(3) What effects need to take place to get to the end state? Define the key effects that need to be achieved to deliver the end state. Effects are not tasks but rather the results of tasks. Examples of effects might include enhanced staff confidence, client reassurance or favourable reporting by the media.

(4) How can the effects best be achieved? Decide how the effects can best be achieved and when and where this should take place. This will help you set down the tasks that are required to deliver the effects.

(5) What resources are required? Take a look at the tasks you have defined. See if they can be combined in some fashion and then decide who is best to undertake each task. Allocate sufficient resources to enable the tasks to be carried out.

(6) In what sequence do the tasks need to occur? Set down the sequence that the tasks need to be carried out in to achieve the desired effects. The sequencing of these tasks is effectively the plan.

(7) How are the tasks to be controlled? Put in place the measures that will enable the conduct of the tasks to be monitored and controlled. This may include aspects such as timings for completion, reporting processes, demarcated lines of responsibility, geographical boundaries etc.

Crisis Decision Making- Top 5 Tips

In previous posts we examined information management and operating a fast OODA Loop. This post looks at some tools to help crisis decision-making. Here are five things to consider.

1. Key Questions: Have a system to guide your decision making that analyses the situation and allows you to use your experience and intuition. Think about the questions you need to ask and write them down in advance. They should help you (1) understand what is going on and the implications of that, (2) appreciate what needs to be done and why, (3) be clear on where your priority lies and (4) identify, resource and co-ordinate tasks. Practice this technique to make its use second nature - rehearse, rehearse, rehearse!

2. Get Your Intention Across: Remember those completing a task may encounter unforeseen problems. Be clear about what needs done (the task) and why (the intent - unifying the purpose of many tasks).  Understanding the intent affords your teams the freedom to adapt the task if they encounter a difficulty and still achieve the intent.

3. Achieving a Focus: There will be lots going on so, to avoid dissipation of effort, make it clear where the focus lies. Define what is critical for success and make sure everyone knows and is working towards that. It can help to define the end state - what will success look like?

4. Using Resources: Resources are scarce so use them wisely. Allocate resources to those tasks that support your focus. Others will have to wait. Remember that not everything will go to plan, so have spare capacity.

5. Using Time Effectively: The one resource that can’t be regenerated is time. If you have to take decisions then think about those who will have to implement them. Leave them the time to do that. Work out how much time is available between starting the decision process and the resulting actions needing to take place. Then use 1/3rd of that time to take the decision and leave 2/3rds for everyone else to actual carry out the tasks the decisions generate.

Our next item will be focusing on a handy tool when it comes to decision making that allows you to combine thoroughness whilst not sacrificing experience, gut feel and intuition so keep watching and following. To avoid missing out why not simply opt to follow our blog by submitting your email address. You will get each post emailed to you as they are posted.

Managing Information and Actions in a Crisis

In an earlier post we talked about the need to manage the process by which crisis decisions are taken and talked about the OODA Loop (read Decision Making or Analysis Paralysis).  In this post we going to present some concepts around how to speed up the OODA Loop. If you can get your decision making processes to happen faster than the crisis is unfolding then your decisions stand to be more effective. On top of that, making a larger number of quicker decisions, each one correcting the errors of the previous one, is likely to help you reach an optimum solution faster than if you wait for total clarity. So what to do?

CRIP: Establish and maintain a full understanding of the situation. This is sometimes referred to as the Common Recognised Information Picture. It is built up of all available validated information. It is not a chronological list but a contextualised picture that can inform decisions. Date/Time stamp it and keep it up to date, even when the decision makers are not meeting. Use information pull (gathering information in) and information push (people and organisations knowing instinctively to forward information) to achieve this.

Strategic Aims: Make sure the Crisis Management Team establish the Strategic Aims for managing the crisis early on. These may even be drafted in a plan for confirmation or adjustment on the day. They won’t change very often but they set the tone for the response, driving information management and response. If the top aim is ‘safety and staff welfare’ this will determine that things progress differently for any given situation than if it   were ‘corporate client entertainment events’. Sounds obvious and simple but it is often overlooked.

Key Issues: Identify the Key Issues of the moment and when decisions have to be made by. Remember also that people need time to carry out the actions that result from the decisions made. Key Issues are those that arrive from looking at the CRIP through the lens of the Strategic Aims. They require management as they reflect the priorities that have been set. Use talented managers to select Key issues and identify options prior to the CMT meeting up.

Manage Actions: Decisions need actions to make them a reality. Taking a decision is not the same as things happening. Have a process, team and resources to break decisions down into actions, allocate those actions and monitor performance. Update the CMT on progress so that they can adjust decisions accordingly.