Creating a quick business continuity plan for COVID-19.

May 11 2020 | Chase Jones, PayPal Editorial Staff

Many times, things can be out of our control, but those are also the best times to stay proactive, productive, and resourcefuland to focus on the things that are in your controlCreating a Business Continuity Plan (BCP) can help with that 

By having a clear picture about how the coronavirus pandemic is affecting your business—and putting in place your Plan B – a BCP can keep your confidence up and business operating

This Business Continuity Planning Worksheet is designed to help get your business through this pandemicIt covers three areas: 


1. Create an ongoing emergency response communication strategy. 
Make sure you and your employees are safe – that’s Step 1. But how do you plan to keep them updated as there are new developments? First, make sure your emergency contacts list is up to dateInclude all your key contacts such as employees, technical support, suppliers, emergency assistance, and your banking relationship manager. Then, establish a communication plan for ongoing updates and identify who’s responsible to keep communications going. Check out page 1 of the BPC Worksheet, Create an emergency response communication plan. 
 
2. Perform a quick Business Impact Analysis (BIA). 
Doing a quick Business Impact Analysis lets you prioritize the key processes in your business and then estimate the potential impact of them not occurringThere are four elements that go into a BIA; you can fill out as you read along by using page 2 of the BCP worksheet, Perform a quick Business Impact Analysis 
 
3. Identify critical business activity. 
Every business has must-haves and nice-to-haves. The must-haves are the absolutely necessary processes and resources you need to run your business. This part of the exercise helps you identify them and then rank them in order of importance. It should include things like 
  • People
  • Processes 
  • Operations  
  • Equipment 
  • Buildings 
Example: Let’s take the example of a physical store closure. If your store closes, then it has a crucial impact on your ability to sell products and services 

4. Determine your maximum acceptable length of time activities can be disrupted. 

Getting back to “normal in this situation may take several weeks or more, so you’ll want to look at how the length of downtime impacts your business. For each critical business activity you identified above, estimate its impact on your business over different lengths of timeThis’ll help you figure out the maximum acceptable period of time an activity can be “offline” before critical failure. For example: 

  • 14 days
  • 30 days  
  • 45 days 
  • 60+ days 
Example: Continuing the example from abovea store closure lasting 14 days will have a much different impact on your business than a closure for 60days. 
 
5. Consider potential impacts from the activity being disrupted. 

For each critical business activity, think about the specific effects a disruption might have to your business. For example: 

  • Loss of critical staff or store/office locations
  • Lost revenue sales and income  
  • Decreased cash flow  
  • Increased expenses (e.g., overtime pay, outsourcing, drop-shipping, etc.) 
Example: If your store is closed, you’ll take a hit to sales revenue. Also, you might start selling more from your webstore, which incurs shipping costs and might raise expenses 
 
6. Think about the impacts in terms of your customers and your finances. 
The downtime from your critical business activities might impact customersfinances, and your ability to meet regulatory requirements (if applicable), and. Estimate as many of these impacts as you can. For example: 
  • Customer: Delayed orders or longer shipping times can cause higher phone volume from upset customers.
  • Financial: How much would disruption cost in terms of a loss in sales revenue or increased expenses.   
Example: If your store is closed, you might not be able to deliver the products or services your customers ordered, causing customer dissatisfactionThe loss in sales revenue would be $X. 
 

7. Create your continuity plans.  

Now that you have a clearer picture on which parts of your business are impacted and how, you can begin to strategize ways to minimize the consequencesSee page 3 of the Business Continuity Planning Worksheet for developing your continuity plans.  

  • Copy the critical business actions you identified in step two above into the “Critical Business Activity” column of the business continuity plan worksheet 
  • List out the current processes you already have in place to prevent or minimize the impact from the disruption 
  • Brainstorm alternative processes or resources you could put in place quickly to restart or maintain operations. 
  • Identify someone to implement each recovery strategy.  
Example: Iyour store is closed, you might already have in place aemail campaign to keep customers engaged. You might brainstorm additional ways to get products into your customers’ hands, such as using social channels to drive traffic to your webstore. 
 
Write everything down. 
Make sure you write down your contingency plansThis may seem like a no-brainer, but documenting this work can become the building blocks of a long-term Business Continuity Plan (BCP) for almost any type of business disruption.  

Moving forward.
C
ompleting this simple Business Continuity exercise will give you back some degree of control—and hopefully help restore your confidenceEven if we all have to turn to our Plan B or even Plan C to keep business running, one thing’s for sure: We’re still moving forward.  
 
More resources to help you plan. 
 
The contents of this site are provided for informational purposes only. You should always obtain independent, professional accounting, financial, and legal advice before making any business decision. 

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