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Management

What’s A Contingency Plan And When Do You Need It?

Whether you’re running a business selling products to customers or delivering services to clients there will be a number of aspects of the way you operate that are key to your ability to function.

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Every business a contingency plan, for events that make standard practices untenable. If you’re operating an online business, a cyberattack could take your site offline, and this is an example of an event that prevents business-as-normal to continue.

On a broader scale, black swan events impact globally so you’ll need a plan for communications and recovery once life gets back to usual. For example, a pandemic will keep people at home, and restrict travel have you a plan for such an event?

In this article, we will consider what’s in a contingency plan.

Also known as a risk management plan, it’s knowing what could go wrong in your business and how to recover to get back to normal operations.

Workplace

Many internal and external factors can disrupt your business in the workplace. External events like a natural disaster or weather event as well as man-made disruptions like a protest march, or terrorist event can prevent access to your workplace.

We’ve recently witnessed the scramble made by many companies around the world, to get workers set up to work from home, so the business doesn’t come to a complete standstill. This event has been the Coronavirus pandemic and its disruption to industry and economies far-reaching.

Young businesses and startups have been caught out with a contingency plan, and many will not survive once wage subsidies and other Government support stop. A company that is prepared for the unforeseen is forewarned and thus forearmed. These businesses have been allowing their staff to remote work at least part of the week for some time.

Moving commerce online has also been an ongoing risk management strategy in the retail sector, and it’s been a move that seen sales continue via eCommerce stores even during the lockdown.

Loss of Critical Systems

Disaster recovery plans are big business in technology. Contingency plans insist on regular backing up of critical data and offsite storage as well as online and cloud storage. Even when the worst happens, businesses are quick to recover when they have their systems and data accessible for recovery. Hardware can be destroyed and replaced and then the software reinstated so the company is back online in next to no time at all.

Financial Management

Evaluating and assessing systems and people that could threaten the financial well being of an organisation is a critical component of risk management. How to detect fraudulent activity and having strategies in place to prevent criminal activity from existing without detection. Fraud management should be part of the risk and contingency plans. Internal fraud is more common than we’d like to believe.

Even with thorough HR recruitment processes, seemingly honest and friendly coworkers can mask their criminal intentions and before long defraud businesses and organisations even non-profits out of thousands of dollars undetected.

Every business, worker and household should have and use contingency plans for their data, finances and premises. The COVID-19 pandemic taught us living from month to month without a contingency plan is too risky and stressful.

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