FAQ: What Goes Into a Business Continuity Plan?

By Indeed Editorial Team

Published September 2, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

There are many external factors that can affect a company's operations, such as a fire or power outage. Creating a comprehensive business continuity plan can help businesses understand the potential risks to their operations and identify procedures to lessen or eliminate those risks. It's beneficial to understand the common elements of a business continuity plan to help you prepare one for your company. In this article, we explain what goes into a business continuity plan and provide answers to some other frequently asked questions about this business tool.

Related: Business Risks: Definitions and Examples

What does business continuity mean?

Business continuity is the process of maintaining a company's operations after an unexpected event or emergency. Many companies have a business continuity plan, which outlines the procedures to take if an event occurs that can affect operations. Examples of unplanned events may include a natural disaster, such as a flood or fire, or a cyberattack that affects a company's information technology (IT) operations. A business continuity plan identifies potential risks to a business and details the plans to protect a company's personnel and assets in an emergency.

A business continuity plan is different from a disaster recovery plan, which is a document that focuses on how a company can restore its IT operations and infrastructure after an emergency. In contrast, a business continuity plan considers all parts of a company's operations, such as relocating employees if the building becomes damaged. However, disaster recovery and business continuity plans often work together to provide direction on how a company can continue to operate after an unexpected event.

Related: Business Continuity Plan: What It Is and How To Make One

What goes into a business continuity plan?

Here are some common elements of a business continuity plan:

Risks

A business continuity plan typically includes a list of potential risks that could affect a company's operations. List each potential risk separately at the beginning of the plan. Include information about the probability of the risk, which means how likely it is to occur, and the areas of a company where the risk may have the biggest impacts, such as staffing, property or equipment. Identifying each potential risk can help a team determine the procedures to take if the risk occurs.

Related: How To Analyze Risk: Steps and Benefits

Business impact analysis

A business impact analysis is an important part of a continuity plan because it helps a company predict the likely outcome of each risk and determine procedures to minimize those effects. This analysis usually includes an overview of the operational and financial impacts on an organization in various scenarios. For each risk, identify any operational impacts on the company, such as increased expenses. Quantify those potential effects in dollar amounts to understand how the risk may affect a company financially. It's also helpful for this analysis to include a timeline of when those impacts may occur after an event.

Read more: Impact Analysis: Definition, Types and How To Conduct One

Organization

This part of a business continuity plan designates a team of employees to oversee the procedures if a risk occurs. It's helpful to have one member of the team who can act as the business continuity leader to oversee all parts of the plan, while other members of the team may have responsibility for a specific area, such as IT. You can compile this information using a table format, or you can create a flowchart that lists each team member and their various responsibilities. This information makes it easy to understand who's responsible for different parts of the continuity plan.

Continuity procedures

A business continuity plan includes procedures the organization plans to take if a risk occurs. When creating these procedures, consider what areas to prioritize after an unplanned event. Examples of priorities that a company may have include payroll operations or data protection. When you understand the priorities, you can develop ways to ensure a company meets those goals after an unplanned event or emergency. Identify personnel in the company who can oversee the various procedures and outline their roles clearly so that another person can take over if necessary.

Contact information

It can be helpful for the business continuity plan to include a list of contact information for any key personnel, vendors or stakeholders. For example, this list may include contact information for all employees involved in the business continuity plan, emergency responders in the area, equipment providers, facilities managers or backup site operators. Include the email addresses and at least one phone number for each contact. Having this information readily available can help teams quickly contact anyone involved in the business continuity plan to ensure a company continues operating after an unplanned event.

Testing procedures

It's important for teams to test a business continuity plan so they can feel confident about the procedures and understand their role in various scenarios. Testing a continuity plan routinely can also help teams identify areas where they can improve parts of the plan and make any necessary changes. There are three common types of testing scenarios that teams usually use to test a continuity plan:

  • Read-through: With this type of testing, teams meet to read through the plan and check that it contains comprehensive strategies for each potential risk.

  • Tabletop: In tabletop testing, each team member discusses their roles in various scenarios to determine any areas of the plan that may require improvement.

  • Simulation: This type of testing simulates an unplanned event or emergency. Teams carry out the procedures outlined in the continuity plan to determine their effectiveness and ensure everyone understands their roles.

Why is a business continuity plan important?

A business continuity plan helps to ensure a company can continue operating even after an unplanned event. Having a continuity plan in place has many other benefits for a company. It can:

  • Minimize impacts: A business continuity plan can minimize the impacts of an unplanned disruption by identifying ways to eliminate or reduce potential business risks.

  • Help retain customers: Following a business continuity plan can ensure a company continues to serve its customers even after an unplanned event. This can help increase customers' confidence in the company and lead to higher customer retention rates.

  • Protect a company's reputation: Having a plan to restore operations after an emergency, such as a data breach, can help protect a company's reputation in the market.

  • Maintain revenue: By implementing procedures to maintain operations, a company can continue to make money during disruptive situations. This can help businesses maintain their revenue and maximize profitability.

When should you review your business continuity plan?

When stakeholders and key personnel develop a business continuity plan, they test it several times to ensure it works in various scenarios. After its development, the team may decide to test it several times a year, or they may test it whenever there are changes to personnel or IT operations. At a minimum, it's a good idea to test a business continuity plan at least once a year. Keeping this plan updated annually can help a business make sure it's prepared in the event of any potential risks that may affect its operations.

What does a business continuity plan look like?

To help you better understand what it can look like, here's a template for a business continuity plan that you can use to craft your own:

[Company name]
[Date of last revision or test]

Risks
[Identify each potential risk, its probability and its potential impacts on personnel or assets.]

Business impact analysis
[Outline the operational and financial impacts of each potential risk and identify when each impact may occur.]

Organization
[Define each team member's roles, responsibilities and the processes they oversee.]

Business continuity procedures
[Explain business continuity procedures for potential risks, including any necessary resources and key personnel.]

Contact information
[Provide name, email and phone number for each key contact, such as personnel, suppliers or emergency responders.]

Testing procedures
[Explain how the team plans to test business continuity procedures and how often the testing should occur.]

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