What is the role of senior business leadership in BCM strategy development?
Senior business leaders should play an essential role in the development of BCM strategies as senior managers review organizations’ operations and products critically to come up with priorities to avoid possible losses (Engemann & Henderson, 2012). Senior managers have the power to make major decisions, and they have the necessary scope of data to align the BCM to the organizational goals. Amadeo Giannini and his prompt decision making can be regarded as an illustration of efficient BCM.
He understood that people would need to deposit money and especially get loans in the time of crisis, so he rescued his bank’s funds by removing them from the zone of the 1906 San Francisco earthquake (Ekekwe, 2011). The banker determined priorities and undertook all the necessary steps to mitigate the negative aftermaths of the catastrophe and even improve its status.
What are examples of decision factors used to select BCM strategies?
Some of the most influential factors that shape the process of decision making are costs and benefits. The manager has to make sure that the strategy is cost-effective with minimum costs and maximum benefits. Other factors include services and products provided, time, manageability. Manageability and time are central criteria to evaluate the effectiveness of a strategy as they define the associated costs. Sirkin (2011) notes that flexibility is one of the most effective strategies, especially when it comes to such low-probability events as natural disasters. The earthquake and tsunami in Japan in 2011 show the need to add flexibility to such operations as supply chain management.
Sirkin (2011) adds that the local production of some components can be an efficient method, but the benefits of this strategy should be critically evaluated to make sure that they outweigh the costs that are significant. Outsourcing is often seen as the most appropriate strategy, but it should also be analyzed since significant threats may also arise. The company becomes reliant on partners, which can undermine the effectiveness of its operations.
Why should changing business conditions result in changes to the BCM strategy? Give some examples
The change in business conditions should lead to the revision of the BCM strategies. It is important as risks often change as well as the capability of the organization. Thus, the company facing financial constraints has to reconsider the costs and benefits of BCM strategies adopted. It may be crucial to choose less costly measures, but it is still essential to remember that the company has to be ready to address certain crises. Therefore, some resources will still be necessary.
Many companies choose to outsource as it enables them to address various risks (Engemann & Henderson, 2012). The expansion is also associated with the change of BCM strategies as companies should invest more, but many fail to do this timely. For instance, Texas Instruments Inc. had to suspend manufacturing due to the damage of their major facility during the tsunami in Japan in 2011 (McGrath, 2011). The company failed to invest enough and had considerable losses.
Why do aspects of the BCM strategy need to be aligned with overall business strategy?
The BCM should be aligned with the organization’s strategy as it is crucial to understand the focus of the company and its major operations. This will help to determine priorities and change operations promptly without significant shifts in future operations. These strategies will enable the company to achieve its short- and long-term goals (Estall, 2012). The example of the banker who operated more than a hundred years ago is also applicable here. Giannini wanted to make his bank one of the most successful by providing banking services when and where they were most needed. His BCM strategy was consistent with the overall strategy, which led to the rapid growth of the company.
Why do aspects of the BCM strategy need to be aligned with the IT strategy?
BCM strategies should also be consistent with the company’s IT strategy. On the one hand, it is necessary to make sure that the company will be able to operate in a period of crisis. For instance, if the company has all the necessary software and hardware. One of the most crucial aspects of this alignment is security. The norms adopted in an organization should be the basis of the BCM steps. For example, such an issue as an epidemic or even pandemic of H1N1 poses certain challenges in this respect (Brenner, 2009). If the company puts a specific emphasis on security, it can be rather challenging to respond to the situation when employees will work from home as companies’ may be obliged to give days off or undertake similar measures. Using modern Internet resources should be in line with the capabilities, priorities, and culture of the business.
Why should changes in business conditions trigger changes in the BCM strategy?
The change in business conditions should trigger the changes in BCM strategies as the companies should take into account new risks. In some cases, some risks may become less relevant, which will lead to a reduction in costs. The overall business environment affects companies’ budgets and priorities. Thus, the company may start producing new products or providing new services, which is often associated with the need to collaborate with new partners and maintain new facilities. The change in business operations may also affect the overall organizational strategy, which will lead to the need to change the BCM tools.
Brenner, B. (2009). Swine flu: Watching for signs of H1N1 havoc. CIO. Web.
Ekekwe, N. (2011). Rethink your business continuity strategy. Harvard Business Review. Web.
Engemann, K.J., & Henderson, D.M. (2012). Business continuity and risk management: Essentials of organizational resilience. Brookfield, CT: Rothstein Publishing.
Estall, H. (2012). Business continuity management systems: Implementation and certification to ISO 22301. Swindon, UK: BCS, THE Chartered Institute.
McGrath, D. (2011). Analyst: Quake impact on IC chain temporary. EE Times. Web.
Sirkin, H.L. (2011). How to prepare your supply chain for the unthinkable. Harvard Business Review. Web.