What Is a Business Continuity Plan and How Does It Work?

Business is tough all over. But doing business in the countries of the Asia-Pacific (APAC) region is especially challenging. Here, companies of all sizes must navigate a landscape that includes far more than the usual business risks because of APAC’s much higher likelihood of disruptive natural disasters. For APAC companies, business continuity planning is not just a matter of having a plan in place so managers can ‘check the box’. It’s about building genuine resilience — the capability to respond to unforeseen events in a way that minimises disruption to business operations, protecting an organisation’s revenue, profits and people.

To understand the challenges APAC companies face, consider that in the 51 years from 1970 to 2021, 43% of all the weather-related natural disasters that the world suffered — that’s 5,105 out of 11,778 — occurred here, according to the World Meteorological Organisation. And there is no letup: The ASEAN (Association of Southeast Asian Nations) Coordinating Centre for Humanitarian Assistance (known as the AHA Centre) reports 360 natural disasters among its 10 member states for the first quarter of 2024 alone, accounting for 129 deaths, 165 injuries and countless thousands of missing and homeless. That’s four natural disasters, on average, every day.

Business Continuity Plan (BCP) Explained

At its core, a business continuity plan (BCP) outlines the processes and procedures an organisation should follow when a disruptive event occurs. A BCP should be a comprehensive roadmap to recovery, describing how to affirm that a business’s critical functions will continue or, at least, can be quickly resumed. It starts by identifying the potential threats to a given business’s operations, crafts actionable strategies to minimise risk and then manifests those strategies in an action plan that assigns specific tasks, roles and responsibilities for key employees to carry out.

BCPs should include a clear understanding of what an organisation’s key products and services are, which business functions are essential and the resources required to continue operations. It should also document the expected coordination of efforts among various stakeholders, including employees, suppliers and customers. Given the many processes and procedures that must be executed in parallel when a BCP is put into action, some organisations choose to automate as many as possible via information technology (IT), such as a cloud-based enterprise resource planning (ERP) system.

The Importance of Having a Business Continuity Plan

A BCP serves as a company’s shield against the unpredictable forces that can threaten its operational stability. A well-crafted BCP sees to it that a business can withstand and quickly recover from disruptions, whether they are natural disasters, technology failures or human errors. In this sense, a BCP safeguards not only the company’s assets but also its reputation and customer trust. The essence of a BCP(opens in new tab) lies in its ability to maintain business functions or resume them rapidly, facilitating minimal service interruption. This continuity is vital for preserving customer relationships and maintaining market share.

In an era where competition is fierce, the ability to bounce back swiftly from a setback can make the difference between a business managing through a temporary hurdle or closing permanently. Furthermore, some large, established companies stipulate in their supplier contracts that their vendors must have BCPs. And, in many industries, a BCP is required for regulatory compliance. From a financial perspective, a BCP helps to minimise the economic impact of a disruption, protecting the company from significant losses and ensuring that it remains financially viable.

What Are the Key Components of a Business Continuity Plan?

A comprehensive BCP should describe how the organisation will quickly respond to a disruption so that its people, premises, information and technology remain accessible. At a high level, a BCP addresses three dimensions: initial emergency response activities, communications and crisis management guidelines, and full operational recovery. These dimensions may be addressed explicitly in the sections of the BCP or threaded throughout. While the specific components of a plan vary according to each business’s requirements, they generally should include the following information:

• Baseline data: This component encompasses critical information, from contact information for key personnel, emergency services and suppliers, to a list of resources required to maintain business operations. It lays the foundation for effective planning, communications and recovery. Accurate data depends on an organisation’s IT infrastructure. Companies with ERP systems in place can draw this information from them because they house data from all departments in a central data repository.
• Purpose and scope: These outline the objectives of the BCP and what it will cover. It should reference any policies that govern the plan, including regulatory requirements, industry standards or best practices to which the plan must adhere. It should clearly state the critical business functions and processes that must be maintained or quickly restored.
• Plan use guidelines: This provides instructions on when and how the plan should be initiated, including the triggers for activation and the roles and responsibilities of key personnel. It should also outline the communication protocols for alerting staff, customers and other stakeholders about the disruption and the steps being taken to address it.
• Emergency response management procedures: This is the nitty-gritty heart of the plan. It outlines the actions to be taken in the event of an emergency, including evacuations (if necessary), shelter-in-place protocols and the step-by-step processes to follow to maintain or restore critical business functions. It should include procedures for relocating to alternate premises, accessing backup information systems and deploying emergency technology solutions. It should also provide guidelines for managing the impact on people, including providing support and assistance to employees and their families.
• Revision management and review schedule: A BCP should be continually updated to reflect the organisation’s current needs. This component describes how the organisation will keep the BCP up to date, reflecting any changes in personnel, premises and technology. It should include a timetable for regularly testing and updating the plan.

A Guide to Business Continuity Planning for the Asia-Pacific Region

A BCP is critical to help small and midsize companies mitigate the impact of natural disasters. Download this business guide and learn what an effective business continuity plan looks like and how to develop a robust BCP.

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How to Create a Business Continuity Plan

Because a BCP is a blueprint for sustaining a business’s operations despite disruptions, the process of writing one involves identifying risks, crafting strategies to address them and assigning roles to carry out the strategies. All of these steps share the common goal of protecting the company’s essential functions — and its future.

Here’s a step-by-step overview of how to create a good BCP, including examples of how a hypothetical midsize APAC electronics manufacturer, Jane Lee Electronics (JLE), would address each step:

1. Establish the scope and objectives: The first step is to decide what the BCP will protect. For JLE, the plan encompasses its entire manufacturing operations and aims to ensure that its production lines and supply chain are resilient against the seasonal floods that annually threaten the company’s business continuity. The BCP objective is clear: to sustain operations and meet customer commitments even during adverse weather conditions.
2. Form a BCP team: Assemble a team from various departments and assign them specific responsibilities for sustaining business operations during a crisis. JLE’s team includes department leads and a dedicated Flood Response Coordinator, each assigned responsibilities to manage — and reduce — the impact of floods on the company’s operations.
3. Conduct a business impact analysis (BIA): Identify critical operations and assess the potential impact of disruptions, prioritising recovery efforts based on their importance. JLE’s BIA pinpoints the assembly lines and raw materials storage as high-risk areas that require immediate attention and protection to minimise financial and operational fallout.
4. Identify risks and threats: Analyse potential risks specific to your business and region, including natural, technological and human threats, to understand their potential impact on your business. In addition to assessing the direct risks posed by flooding, JLE identifies potential supply chain interruptions and equipment damage that could result from a disaster. Based on that analysis, it develops a comprehensive risk profile.
5. Develop strategies to mitigate risks: Design preventive measures to reduce risks, as well as contingency plans for an effective response and recovery should a disruptive event occur. JLE’s risk mitigation strategies involve practical measures, such as waterproofing critical areas, securing backup power solutions to ensure uninterrupted operations, establishing a diverse supplier network to maintain the flow of raw materials even if some suppliers are disrupted and replacing its on-premises technology infrastructure with a modern cloud ERP system.
6. Write the BCP document: Compile all information into a clear, concise and accessible written plan detailing the necessary steps for maintaining continuity. JLE’s BCP document serves as a centralised resource, outlining flood response protocols, alternative supplier contacts and equipment protection measures. It provides all of the information needed to make certain that all stakeholders are well-informed and prepared to act in the face of a disaster.
7. Train your team and test the plan: Ensure that all team members are familiar with the BCP through regular training and drills. Improve the plan based on stakeholders’ feedback. JLE invests in regular flood-response exercises to familiarise the entire team with emergency procedures and communication protocols, fostering a culture of preparedness and resilience.
8. Review and update the plan: Keep the BCP relevant and effective by regularly updating it to reflect new threats and changes within the business. JLE commits to reviewing and updating its BCP every six months.

What Are the Benefits of Business Continuity Planning?

Business continuity planning offers a strategic defence against potential disruptions, which is particularly beneficial for businesses in the APAC region because of its vulnerability to natural disasters. A good BCP’s key benefits include:

1. Mitigating risks.
2. Minimising downtime.
3. Protecting essential business functions.
4. Enhancing business resilience in the face of natural disasters like typhoons, floods and earthquakes.
5. Minimising the costs of disruptions by identifying risks and implementing mitigation strategies before events occur.
6. Improving customer retention, as customers are more likely to remain loyal to companies that demonstrate preparedness and reliability.
7. Helping ensure compliance with industry regulations related to business continuity and data protection, avoiding potential penalties and legal issues.
8. Bolstering employee morale and productivity, because the resilience and assurance that can come from a good BCP translates into heightened job satisfaction and employee engagement.
9. Providing valuable intelligence about business activities and organisational workflows that can help refine day-to-day processes.

Modern ERP systems have a role to play in No. 9, offering advanced analytics and business intelligence capabilities that provide real-time visibility into operations and help business managers make informed decisions regarding process refinements.

What Are the Challenges of Implementing a Business Continuity Plan?

APAC businesses face many hurdles when creating and implementing business continuity plans. By addressing these challenges, companies can move further along the path toward a BCP that offers consistent protection against the unknown. Some common challenges include:

• Limited resources: Small and midsize businesses (SMBs) often lack the funds and people needed to create a BCP, so they struggle to prioritise business continuity planning alongside competing business needs.
• Lack of expertise: Creating a BCP demands a specific skill set, and businesses may struggle to find employees with the right knowledge or experience. Likewise, sourcing and paying for professional expertise or training can be difficult and expensive.
• Underestimating risks: Some APAC businesses are less averse to change or disruption than their peers in other regions. While this often leads to benefits on the innovation front, it can cause them to underestimate the potential impact of disruptions, such as cyber threats and supply chain failures, which, in turn, causes them to underinvest in developing effective BCPs.
• Complexity of supply chains: Asia’s vast, globally interconnected supply chains provide numerous sources of potential disruption. While diversification can help manage risk, setting up and managing a complex network can be a significant challenge.
• Rapidly evolving threats: The region experiences an array of rapidly changing threats, from natural disasters to shifting political landscapes, that demand regular BCP revisions.
• Ensuring staff buy-in and training: Businesses struggle to make sure employees know the right steps to take in a disruption. But BCP training is difficult to present in an engaging, hands-on way to staff with many other responsibilities.
• Technology reliance and recovery: As companies become more dependent on digital systems and data, they also become more vulnerable to technology-related disruptions. Assessing risk from cyber threats, technology debt from legacy systems, data sovereignty rules, dependencies on third-party providers and employee skill gaps pose challenges that keep continuity executives up at night. Ideally, companies should have a modern ERP system to integrate information from business departments across the enterprise with a single, unified database.
• Integration with other plans and compliance issues: Businesses need to ensure that they comply with any applicable business or industry regulations when managing a disruption. Aligning the BCP with these other emergency requirements adds resources and expenses that many businesses cannot afford.
• Managing outsourced relationships and dependencies: More outsourcing relationships mean more key dependencies on external vendors. Companies must confirm that each partner is prepared to take the necessary steps in an emergency.
• Cultural differences: APAC is a diverse region, with myriad cultural norms that shape both how companies think about business continuity and how they respond in a disruption.

What Is BCP Testing, and How Often Should a BCP Be Tested?

BCP testing is the process of evaluating and validating a continuity plan to verify that it works as intended to protect the organisation’s people, processes, information and revenue. It also has two additional corollary purposes: to identify potential weaknesses, gaps and inconsistencies in the plan and to make certain that all team members are familiar with their roles and responsibilities under the plan.

Testing is typically done using simulated scenarios and other exercises that mimic a disruptive event, and the results are used to refine the plan. Meanwhile, the simulated practice hones the plan’s effectiveness, builds team unity and affirms that staff members are ready to execute it should the time come.

Several methods are commonly used to test BCPs, including:

• Tabletop exercises, in which contingency plans are tested in group discussion. To demonstrate their understanding of the plan, team members explore various potential disruptions and their impact on the organisation. They discuss the rationale behind the strategies and responses outlined in the BCP for each type of contingency, validating that the plan is not only theoretically sound but also practical in real-world situations.
• Walk-throughs are detailed reviews of the plan’s steps to confirm that each action is feasible and that necessary resources are available.
• Full run-throughs are comprehensive simulations that closely mirror the conditions of an actual disaster. This type of testing is designed to evaluate the plan’s effectiveness in a real-world scenario and to ensure that every aspect of the plan functions as intended.

BCPs should be tested at least annually, but more frequently for larger or particularly dynamic organisations. A company may want to ramp up its testing schedule in response to changes in the risk environment, vulnerabilities exposed through prior tests or changes in the organisation that affect the plan.

Choosing the Right ERP for Business Continuity Planning

Because the business landscape in the APAC region is susceptible to sudden climate shocks, earthquakes and geopolitical changes, businesses need to plan for inevitable disruptions. The right ERP system can provide a crucial foundation for effective business continuity plans, so selecting an ERP system is a critical decision. Key selection criteria include the system’s ability to integrate seamlessly with existing business processes, its scalability to accommodate future growth and the system vendor’s expertise in your industry. These factors ensure that the chosen ERP can adapt to evolving business needs and support the organisation through any disruptions, making it an integral part of the business continuity plan.

Strengthen Your BCP With NetSuite’s Cloud ERP

Cloud-based solutions, such as NetSuite ERP, offer inherent advantages over on-premises systems, most notably in the form of enhanced resilience, data backup and disaster-recovery capabilities. NetSuite integrates critical business processes, including accounting, customer relationship management, procurement and human resources, serving as a central information hub for SMBs.

NetSuite’s all-in-one business management suite not only helps companies operate more efficiently but also provides strong operational resilience. With vital business data stored in multiple geo-independent data centres and replicated across them, NetSuite’s cloud-based architecture minimises the risk of outages and reduces the burden on IT departments during a disruption. Its built-in disaster recovery capabilities, regular backups, patches and upgrades ensure that essential records, processes and communications remain intact and accessible.

Additionally, NetSuite’s analytics and reporting capabilities provide real-time visibility into key business metrics, enabling informed decision-making during a crisis, while its mobile accessibility supports remote work arrangements. By partnering with a robust, cloud-based ERP provider like NetSuite, businesses can significantly enhance their resilience and ability to execute their BCP effectively.

Developing a comprehensive business continuity plan is crucial for APAC businesses, which must navigate the unique challenges posed by the area’s heightened risk of natural disasters and geopolitical shifts. By identifying potential threats, crafting strategies to mitigate risks and clearly defining continuity plans, companies can build resilience and minimise disruptions to their operations. Regularly testing and updating the plan, as well as leveraging cloud-based ERP solutions, further enhances an organisation’s ability to swiftly recover from unforeseen events, safeguarding its revenue, reputation and future.

Business Continuity Planning FAQs

What are the 4 P’s of business continuity?

The four P’s of business continuity are people, processes, premises and providers. They represent the key areas that a business continuity plan should address to ensure an organisation can continue to operate during and after a disruptive event.

How is business continuity planning different from disaster recovery planning?

Business continuity planning is more comprehensive. It considers how the entire organisation and all of its critical business functions, including customer service and supply chain management, can continue during and after a disaster. Disaster recovery planning is more specific, focusing primarily on restoring IT infrastructure and data access after a crisis.

What is business continuity impact analysis?

Business continuity impact analysis (BIA) examines how a disaster, accident or emergency might interrupt a company’s critical business operations. It’s an essential component of a business continuity plan, as it helps to prioritise resources and determine recovery strategies.

What is the business continuity planning process?

The business continuity planning process involves creating a plan to ensure that an organisation can continue operating during and after a disruptive event. It includes identifying potential threats, assessing the impacts on business operations and developing strategies and plans to mitigate risks and ensure continuity of critical functions.

What are the 5 components of a business continuity plan?

The five components of a business continuity plan typically include:

• Baseline data, including contact information for key business stakeholders and a list of resources required to maintain business operations.
• Purpose and scope, such as plan objectives and what the plan covers.
• Plan use guidelines, which provides instructions about the circumstances under which the plan should be triggered and the roles and responsibilities of those empowered to initiate it.
• Emergency response management procedures are the heart of the plan, detailing the actions to be taken in the event of an emergency.
• Program maintenance and improvement describes how the organisation will keep the plan up-to-date.

What are the 4 phases of business continuity?

The four phases of business continuity are:

1. Mitigation: Reducing the risk of business disruptions.
2. Preparedness: Preparing to handle disruptions when they occur.
3. Response: Reacting to an incident to minimise its impact.
4. Recovery: Resuming normal business operations.