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Tuesday, April
07, 2020 / 03:25 PM / by NECA / Header Image Credit: NECA
This Tool is designed to support your enterprises
during the COVID-19 crisis. Chiefly that means by designing a bespoke "Business
Continuity Plan" (BCP) for your business. The tool will enable you to:
1. Assess the level
of risk and vulnerability of your business; and
2. Develop an effective risk and contingency system for
the business.
This tool aims to establish the risk profile of your
enterprises and the level of vulnerability to COVID-19 in terms of its impact
on your People, Processes, Profits and Partnerships (the "4Ps").
The tool is mostly targeted at smaller enterprises
with limited resources and structured in two parts.
1. The first part
is a risk assessment that you can quickly do. It establishes the level of
risk/vulnerability to your enterprises.
2. The second part of the tool is a six-step process - using an illustrative example of a fictitious SME - to assist you develop your
own Business Continuity Plan.
Part 1: Establish your risk profile -
Self-assessment
Indicate your answers to the yes/no questions below
with an X. There are four sections composed of a total of 61
questions structured around the "4Ps" „People, Processes, Profits and
Partnerships‟. You can estimate your vulnerability level by adding
up the number of times your answer was "yes" in each questionnaire.
Answer YES if you are not sure or don't know.
I People: Risk Matrix
II. Processes: Risk Matrix
III. Profits: Risk Matrix
IV. Partnerships: Risk Matrix
From this exercise, you will have identified which of
the 4P's (people, processes, profits and partnerships) your
enterprise is most vulnerable too (and which aspects or variables in particular).
To calculate your total vulnerability, add up the times you answered "yes" in
the four vulnerability self-assessments. Insert this sum in the cell below.
Risk score
Interpretation of your score: your risk profile
This score does not rate
whether your enterprise is good or bad. It is simply a benchmark of your
enterprise and its vulnerability to COVID-19 that helps in the identification
of areas where your enterprises‟ overall resilience to the
COVID-19 crisis could improve. Most importantly it will tell you where you are
most at risk – your workers, your supply chains, your reliance on third
parties.
40-61
|
Your
enterprise is highly vulnerable to the negative impacts of the COVID-19
crisis. Your enterprise is quite likely to be severely impacted, which may
cause long-term disruption in the event of a deterioration of the situation.
Your next plan of action should be to identify whether you are most
vulnerable to internal or external threats and take measures to reduce risk
and vulnerability to COVID-19. |
20-40
|
Despite
having taken some action to increase preparedness, your enterprise remains
vulnerable. Understand whether your threats are internal or external and make
sure to prioritize your elements of vulnerability when establishing your
business continuity plan. |
0-20 |
You are on the right path
towards becoming more resilient, but there are still some areas where you
could reduce your vulnerability. Make sure to establish your business
continuity plan in a way to manage risk of your internal and external
threats. |
Part 2: Develop a six-step COVID-19
Business Continuity Plan
The following are the six steps needed to establish
your business continuity plan (BCP):
Step 1: Identify your key products or services
What are your most important products or services?
Consider the following criteria:
Step 2: Establish the objective of your BCP
What do you want to achieve by establishing your BCP?
Step 3: Evaluate the potential impact of disruptions
to your enterprise and workers
How long can interruptions last before becoming
unacceptable? What are the resources required and the suppliers, partners and
contractors needed to conduct key operations?
Step 4: List action to protect your business
Use the 4Ps framework to do this. Actions to minimize
risk to your: People, Processes, Profits and Partnerships (the "4Ps").
Step 5: Establish contact lists
More of your activity will be non-physical (WhatsApp
calls, zoom meetings etc). Make sure you have accurate and update lists of all
your key stakeholders.
Step 6: Maintain, review and continuously update your
BCP
The
following is an example of how a small business owner put together a BCP for
her business
How a small business owner developed a
BCP to mitigate the impact of COVID-19
Caro Corona is the owner of company producing canned
sardines in Lagos, Nigeria. She sells her products directly throughout Nigeria
and to larger firms who export. Caro relies on consistent orders from three
companies for about 80 per cent of her business. These companies due to their
connections to the export market send regular orders. As COVID-19 cases spread
in Nigeria, Caro developed a BCP to protect her business. She has a total of 60
workers.1
Caro completed the COVID-19 Risk Assessment test and
realized her risk profile was high. She dealt with multiple suppliers on a
daily basis. Her workers worked in close proximity. She was reliant on the port
staying open for much of her sales. The rest of her sales mostly went to other
Nigerian cities and she needed reliable transport links. Caro realized she
needed a BCP.
Step 1: Caro identified her key products
For Caro, her main products are different types of
canned sardines. Sales of these products are the sole means of revenue
generated. Her client base is relatively small. She has three main customers
who constitute 80 per cent of sales. The cost of non-delivery to these
customers would have very negative consequences on her business.
Step 2: Caro established the objective of her BCP
The goal was to develop simple internal processes for
her business that would provide key protections for the "4Ps": people,
processes, profits and partnerships. This meant:
Step 3: She evaluated the potential impact of
disruptions to her enterprise and workers
She
assessed the impact of disruptions to her key operations. What operations are
required to produce and deliver her products and what is her tolerated
downtime: how long can key operations be out of action before it becomes highly
damaging to the viability of the business. She identified what operations were
required to produce and deliver her products and where the risks where located?
This involved a short stakeholder mapping exercise. There are five main
stakeholders that are critical to her business: Workers, customers, suppliers,
support services and regulatory authorities.
This exercise showed Caro how dependent her businesses is on external
actors remaining healthy and in the case of her suppliers, support services and
customers, able to stay in business. She quickly realized that she could
potentially go bankrupt within four to six weeks if she was badly disrupted.
She assessed "what would be the impact of not conducting her key operations?" She looked at each of the stakeholders above and realized that any disruption
to them would mean a disruption to her business.
She assessed her main potential disruptions as follows:
She thought about the events that were outside her control and how they
could impact her suppliers and what were within her control that she controls
to some extent. On the negative side, she was highly dependent on others,
chiefly her suppliers and she has no influence over government restrictions
that may come. On the positive, the demand for tinned/canned products was
rising.
Step 4: Caro took actions to protect her operations
People
Processes
Profits
Partnerships
Step 5: Caro established contact
lists
Step 6: Caro maintained, reviewed and continuously updated her BCP
She reviewed and updated her plan every week to:
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