Business Continuity Requires Preparing For The Unexpected
Organization resilience comes from planning, communication, and trust
Welcome to the Gazebo! Grab a cup of coffee and join me for some tips to help you succeed at the intersection of management, communication, and technology.
This Week’s Summary:
Organizations, like people, must prepare for the unexpected.
Business continuity planning should be an ongoing process.
We should always be training our replacement.
Knowledge transfer is how you become replaceable.
Communication is at the heart of knowledge transfer.
It’s been a tough week. I lost two good friends and almost didn’t write this week’s post. But their passing got me thinking about how the unexpected can occur at any time not just for us personally, but for organizations too. When it happens to us personally, we usually find some way to adjust our lives in the short term to accommodate the upheaval, and at some point, most of us will re-engage with our lives and carry on.
Image created by Ed Paulson using Copilot in Windows.
But what about when an organization loses a key person who had unique, proprietary knowledge? Or a major account leaves and taking a large percentage of your revenue with them? Or a natural disaster knocks out an important production facility? Your customers count on your company to deliver for them so that they can deliver for their customers. When you cannot fulfill your part of the cycle, they can be seriously impacted which not only hurts them today but can also negatively impact your relationship with them moving forward. Business continuity analysis is the formalized process whereby a company analyzes events that could cause a major disruption of the normal routine and then takes steps to minimize the event’s likelihood and/or minimizes the impact should the event occur.
We do this ourselves when we buy life insurance or create a will. We take an honest look at how our family would be impacted by our passing and then pick the insurance type and amount that will protect them as they recover from the shock of our loss.
Insurance is called a risk transfer device because it transfers the financial impact of our passing from our family to the insurance company which, hopefully, will honor the policy and pay the money to our beneficiaries who are often our heirs.
This financial cushion gives our family the breathing room to recover from our loss and not lose the house while grieving.
How does a company transfer the risk related to losing a key employee? This is where knowledge transfer and communication come into the picture. No computer knowledge base can replace a human being, which you have heard me hint about in prior posts. Only a human can process the various inputs through their experience and knowledge and arrive at a seasoned solution to a complicated problem that doesn’t have a clear “right” answer, what I call an ambiguous situation. There is, however, a possibility that this could be coming in our future through AI, if it is not already here. It would be interesting to see what
thinks about this topic.As an aside, if you have an interest in AI and its various uses, strengths, and foibles, you should be reading his “Marcus on AI” newsletter on Substack.com. Always great food for thought. Thank you, Gary, for helping us understand this powerful developing technology.
Back to knowledge transfer. Our unique person may have taken the time to enter data, information, videos, and other content into a knowledge base which will provide a starting point for whoever must pick up where the prior person left off. But that is not the same as being privy to their internal workings as they evaluated a situation, determined key points to consider, determined the constraints, and arrived at a solution.
That is the art of the human being which can only be transferred human-to-human, and the person with the knowledge must be willing to share their time and knowledge to make this happen.
If they view this knowledge transfer as an act that detracts from their responsibilities, then they are unlikely to freely offer their time. But, if it is viewed as key to building organizational resilience, it is just like paying for insurance, except you are paying with time and human energy instead of a checkbook.
Will it be worth it? Hah! Good question! Is insurance worth it? I have been paying my homeowners insurance for years and never made a claim and I would keep paying for it even if I was not required to do so by the bank that holds my mortgage. Why? Because I don’t want to have to pay the multiple hundreds of thousands of dollars that would be required to rebuild my house and make me and my family whole again. To pay a thousand dollars a year to guard against having to pay hundreds of thousands in the future while recovering from a crisis is, to me, a good tradeoff. To invest a small percentage of your key employee’s time today to ensure a smoother transition should something happen to them in the future is also a good business continuity investment.
Picture the situation this way. Your key employee has just passed, and an issue comes up with a major customer that shuts them down. Normally, you would put the situation into the capable hands of your recently passed employee. Now what do you do? Your customer’s frustration level will start to increase as you scramble to find someone, or a team of someone’s, who can help with the problem. How will they react if your new team makes a few false starts that don’t solve their problem? Any seasoned manager understands that there will be a transition period after the loss of someone important, but at some point, they must protect their own business interests, which won’t include you if they deem you untrustworthy. How much would you have paid to avoid that situation? That is the insurance I’m talking about.
Image created by Ed Paulson using Copilot in Windows.
Take a moment to review your situation and ask yourself the following questions:
1. What are the items, processes, or people of great value to your organization?
2. What events could occur that would seriously jeopardize your answers to question #1 and hurt business continuity?
3. What steps have been taken to decrease the likelihood of these events occurring or to mitigate their impact should they occur?
4. Is it enough or should you consider additional steps?
5. You can do this for your personal situation as well, you know.
None of us wants to think about the unthinkable, but this week reminded me that these events can happen unexpectedly, and we somehow need to manage in the aftermath. It is never easy, but it is more manageable if we have taken steps in advance to prepare. Plus, the simpler it is for the recovery steps to activate the better. Crisis often creates chaos, and few good choices are made amid chaos and uncertainty.
Be safe and take a few moments to hug a loved one. You know …
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I'm sorry to hear about your loss, Ed. My condolences to you. Losing anyone close to you is never easy.
Excellent article on the Unexpected - whether in business or in our personal lives. You bring forward several very important points to consider. Cost vs. Risk is always the question and we never really know the answer. Obviously, some people are more risk-tolerant than others.
I am really impressed with the articles you write. You have a lot of wisdom to share.