In a Business Continuity Management (BCM) conference held in India, speaker after speaker from India kept mentioning the importance of BCM if a disaster takes place. After a while, a Japanese BCM expert came to present his session.
Before beginning, he expressed this telling observation:
“So many speakers before me came and spoke about how BCM helps if a disaster takes place…how recovery strategies are required to be in place if a disaster takes place. However, in Japan we don’t plan for business continuity IF a disaster takes place. We plan for Business Continuity for the time WHEN a disaster takes place”.
We plan for Business Continuity for the time WHEN a disaster takes placeWhile it may sound like a matter of semantics, the attitude towards Business Continuity will vary depending on whether you treat disaster as an “IF” or “WHEN”.
But before we make the journey from IF to WHEN, let us question whether this journey is logical. Why should we even change our attitude?
Cold Hard Statistics of Disasters in India
India is a disaster prone region. As per the Vulnerability Atlas of India, India is among the world’s most disaster prone areas:
– 59% of land vulnerable to Earthquakes
– 8.5% of land vulnerable to Cyclones
– 5% of land vulnerable to floods
> 1 million houses damaged annually + human, social, other losses
India is also one of countries affected by terrorism. It also has internal security concerns related to Maoist groups. In the recent past, fire has been a major cause of disaster in India. Be it natural or man made disasters, India has suffered huge losses in terms of life and property.
Be it natural or man made disasters, India has suffered huge losses in terms of life and property.
Status of Business Continuity in India
The government has woken up to the dangers of disasters. It passed the Disaster Management Act in 2005 under which National Disaster Management Authority (NDMA) was set up, headed by the Prime Minister, and State Disaster Management Authorities (SDMAs) headed by respective Chief Ministers, to spearhead and implement a holistic and integrated approach to Disaster Management in India.
In addition to this, there are only a few regulatory mandates around BCM in India. These include mandates by the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI) and Insurance Regulatory and Development Authority of Govt of India (IRDA). The BPO and ITeS sectors have adopted BCM extensively due to demands from their clients typical in US and Europe. Multinational organizations have adopted BCM as part of their global policies.
Lack of regulatory mandates, loss aversion tendency and fatalism has led to poor adoption of BCM in India
However, in general, most businesses in India have not proactively adopted BCM. It is still perceived as an unnecessary cost with no immediate benefits. This loss aversion tendency and sunk cost fallacy of people is one of the key reasons for poor adoption of BCM. Add to this the fatalistic tendency that is widely prevalent in India.
Begin the journey from IF to WHEN
As the historical data indicates, disaster is a certainty. Instead of framing our BCM argument with a big IF, it is high time we recognized that it is a matter of WHEN.
There is a psychological shift in tackling continuity risks once the risks are accepted as inevitable. All stakeholders including planners, management and employees will take the initiative seriously. Organizations will allocate both time and financial resources to BCM to ensure its success.
There is an urgent need to change the perception of BCM as a tool for to handle a probabilistic disaster to one that handles disasters that will inevitably occur.
There is an urgent need to make BCM an indispensable management capability. Consequently, there is an urgent need to change the perception of BCM as a tool for to handle a probabilistic disaster to one that handles disasters that will inevitably occur. Unless this perception change happens, BCM will continue being considered a nice to have but non-essential capability.
(Keith Prabhu is a Member of the Business Continuity Institute. He is a contributor to the BCI Good Practices Guide 2013. He has been a judge for the BCI Global BCM Awards. He is the Founder & CEO of Confidis, an organization that provides services in the domains of Business Continuity Management along with other services. For assistance, please write to us at: info AT confidis DOT co )