What Is a Business Continuation Plan?

A business continuation plan is a written document that serves to ensure a business will continue operating in the event that management is lost or disaster strikes. In small firms, it can be as simple as a couple of pieces of typed paper shoved into a desk file, detailing who owes the company what, listing key contacts such as the firm's lawyer and accountant, and possibly detailing a life insurance policy that covers the outstanding debt in the event the CEO or owner dies. In contrast, larger companies often have an entire department dedicated to constantly updating business continuation plans and planning for hypothetical situations.

Management Continuation Plans

The first type of business continuation plans deal with the replacement of management after a death, retirement or change in jobs. To build a business continuation plan, you need a current organizational chart that lists who is in what position, who reports to them, and what they are responsible for. Ideally it would also include a manual that contains all the information needed to do each job.

Who Moves Where

Once you have the current organizational chart, the next step is to figure out who can replace each person listed. Depending on the importance of the department, you can move people laterally or you can promote someone from within the department. If no one is able to replace a given person in an organizational chart, you should consider person considered a critical employee and immediately move to identify outside talent who could replace her.

Disaster Continuation Plans

The second type of business continuation plans revolves around disaster preparedness. The goal of a disaster continuation plan is to determine the disasters that could occur where the business operates. Once those are determined, you will take steps to establish supplies and contingency plans to ensure that the firm can continue operating if disaster strikes.

Examples

For New Year's Eve 1999, when nobody was quite sure what would happen with the computer systems and Y2K, Fidelity Investments parked tanker trucks full of fuel in all their regional offices' parking lots to ensure that they could keep each office complex's generators going. Later, during the snowstorm in 2005 that blacked out most of the Northeastern United States, Fidelity managed to turn its disaster preparedness into a marketing coup by running advertisements where the entire map of the Northeastern United States was blacked out but a green light (Fidelity's colors) was shining at each of their office locations thanks to the backup generators at each site, indicating that they were still open for business.

Simple or Complex

Business continuation plans can be as simple or complex as you need them to be. The important part is that they exist, they have been given careful thought, and employees know where they are and how to execute them.