Contingency Plans Link Up With Organisational Policies And Procedures

A Contingency Plan is a plan devised for a specific situation when things could go wrong. Contingency Plans are often devised by businesses that want to be prepared for anything that could happen. They are sometimes known as "back-up plans", "Worst-case scenario plans", "Scrap Situation" or "Plan B".

Contingency Plans include specific strategies and actions to deal with specific variances to assumptions resulting in a particular problem, emergency or state of affairs. They also include a monitoring process and “triggers” for initiating planned actions. They are required to help businesses or individuals to recover from serious incidents in the minimum time with minimum cost and disruption.

Business contingency plans need to include planning for marketing to gain stakeholder support and understanding. Stakeholders need to be kept informed of the reasons for any changes, the vision of the end result and the proposed plan for getting there. The level of stakeholders' importance and influence should be considered when determining the amount of marketing required, the timescales for implementation and completion, and the overall effectiveness of the plan. If time permits, input and consultation from the most influential stakeholders should be incorporated into the building of any contingency plan as without acceptance from these people any plan will at best encounter limited success.

Private industry is subjected to many non-business-related perils. Ironically, as technology advances, previously unknown or non-existent threats seem to continually evolve. These are in addition to the natural or man-made disasters normally considered. Disasters can strike at any time; and, the more an organisation is concentrated in a single location or geographic area, the greater the risk that a single disastrous event could cause serious business disruption or organisational decapitation.

Yet, even in the face of overwhelming daily evidence, executive managers continue to resist the need for disaster contingency planning. They rationalize that since they are not on a hurricane prone island, or sitting on an earthquake fault, they have no real need to prepare for a disaster. They firmly believe that their organisation’s fiscal and strategic programs, policies and procedures are quite adequate; the current disaster response capability is adequate; and that nothing is broken, so why fix it?

The operative terms are “adequate” and “not broken.” Too often, “adequate” is used to limit refinements or further exploration. In emergency planning, it stifles improvements. “Not broken,” coupled with adequacy, tends to hinder internal initiative and limit outside observation or influence. Maintaining adequacy not only prevents progress, but also causes regression, which can lead to failure. Progress cannot be made without some forward motion.

Contingency planners base their plans upon a perceived threat in order to identify the resources required to counter that threat. These threats can generally be classified into four broad categories:

Accident - radiation leaks, chemical contamination, loss of power, transportation incidents, toxic fumes, etc.

Natural - floods, fires, earthquakes, hurricanes, etc.

Internal - sabotage, theft, etc.

Armed Conflict - terrorism, civil insurrection, armed conflict, etc.

Thus... “A threat is any event that will deny you the use of your normal work area or the telecommunications connectivity to that area.”

In all but the smallest organisations, adoption of a formal planning methodology is needed to ensure quality, consistency, and comprehensiveness of the completed contingency plans. A standard methodology can also provide maximum assurance that the plans for interrelated departmental functions (Administration, Production, Communications, Finance, etc.) mesh properly to form a cohesive program.

The “ad hoc” approach to contingency planning should absolutely be avoided. A formal and disciplined planning methodology will ensure that plans address the total organisation, not just survival of the pieces. Additionally, the planner should avoid fragmented solutions such as building a contingency plan for the IT department that will ensure survival and recovery of data (computer survival) but giving no thought to addressing the issues that ensures overall organisational survival.

A basic planning process will outline the requisite content for contingency plans including objectives, requirements, and a desired format. This process will also determine which type of disaster is most threatening to organisational survival, which key locations and critical functions must be protected, and it will establish timelines (i.e. the maximum amount of time an organisation can be without a critical capability) for unacceptable loss of capabilities. Each determination should include a critical, holistic, functional assessment.

One of the vital talents that any contingency planner should acquire is the ability to think backward. Specifically, one must be able to visualise hours, days, and even weeks into an event, and then mentally work backwards, asking at each step of the way, ...“how did I get here?” “what was needed?” and “what is required at this instant in time?” As planners refine this talent, they will be able to “freeze frame” specific phases of an event and analyse all the required actions and reactions that must take place to ensure a successful disaster recovery operation.

“No one plans to fail; they just simply fail to plan.” Developing an organisation’s disaster contingency plan is not a trivial undertaking. It is a painstaking process. Furthermore, once the plan has been developed, it must be reviewed and updated whenever the company adds new products, new facilities, new technology, or undergoes major internal changes. A disaster contingency plan is the corporate blueprint for response and recovery. It must be sufficiently complete to allow the lowest operating element to know precisely what to do and, if necessary, to move to an entirely new facility and resume operations - “business as usual". The plan follows the basic interrogatives - who, what, when, and how: who is involved; what resources are involved; when must the resources be used; and how are they to be used. The plan must basically outline people responsibilities, the use of equipment and other material resources, and detailed operating instructions; nothing can be assumed. The plan is the organisation’s strategic battle plan for recovery. The follow-on contingency plans of the operating elements become the organisation’s tactical battle plans for survival.

We are constantly bombarded with the need to produce “THE PLAN”. The plan thus becomes the end means of corporate survival and recovery. What is rarely, if ever, mentioned is that the plan is an operational document that is designed to be implemented when needed and, as such, it must be based on something authoritative. What is missing in the rush to produce “THE PLAN” is the awareness that there is a crucial first step that should always be conducted.

No plan can be developed, or should even be attempted, without first performing an objective analysis of the organisation’s needs and objectives. The contingency requirements, assumptions, and constraints must be clearly understood first before a pencil ever touches paper for the first draft plan outline. The assessment must be conducted with meaningful participation by both management and operational personnel. Participation by both groups is absolutely required. Although management establishes organisational policy and planning objectives, it is the operational personnel who must execute the plan.

The end product of the analysis will be a well-documented contingency plan. It is this document that details the specific threat, requirements, assumptions, constraints, and outlines a proposed general course of action. In “global” terms, it states what needs to be done and forms the foundation document for the follow-up plans that deal in specifics. Furthermore, care must be taken to ensure that it is not driven by a single solution. All possible solutions must be explored, analysed, and each compared to the other. Only after all other solutions have been eliminated, should the remaining solution be used as the basis for the concept.

To develop a contingency plan, three basic options - or some combination of the three - are available to the contingency planner. These options are to: complete the work in-house; obtain assistance from a specialized disaster software and/or storage vendor; or hire an outside (disinterested) contingency planning consultant to assist in plan development.

In-house: This option often appears to be the cheapest because no additional expenditures are required. However, there are hidden costs as employees are diverted from their normal work and, therefore, some of their normal work assignments may not get done. Furthermore, it usually takes longer to complete the plans which often prove to be inadequate. This is especially true if in-house personnel lack contingency planning expertise and experience. Moreover, because the planning effort can siphon off energy from day-to-day activities, supervisors tend not to offer their very best employees to participate.

Specialized vendors: This approach varies in cost. However, it is often better to defer the use of their services until there are known needs and requirements. Although there are very good vendors in this area, some are focused on providing a very limited service and are not concerned with synergistic organisational survival.

Outside (disinterested) consultant: On the surface, this option appears to be the most expensive. However, it is the most predictable option to ensure complete, tailored assistance. When weighted against internal employee costs of trying to get organized, false starts, and the internal strife in-house efforts cause, the actual expense of consultants may actually prove to be no more (and sometimes less) than the in-house option. Consultants can provide outstanding assistance in helping understand the total planning process.

A combination: More often than not, a combination provides the best of all options. By selectively using only the outside assistance required for each step, combined with the use and training of in-house assets, the entire process is significantly accelerated. Furthermore, it ensures that expertise is available when needed, and that all additional specialized assistance is pre-identified as absolutely required to satisfy specific corporate contingency objectives. And, with adequate staff participation, this approach ensures that planning knowledge becomes embedded inside the company. However, to reach its full potential, this option requires the organisation’s Contingency Planner to strategically, and relentlessly, manage the process.