Prior to the pandemic, many small- and medium-sized businesses (SMBs) were busy running their day-to-day operations and didn't put much thought into being ready to handle future downturns. However, the impact of COVID-19 stressed the importance of being prepared for disasters and highlighted the need for business continuity planning. Indeed, if only more SMBs had a business continuity plan, more would have survived in 2020.
Related reading: Create an effective business continuity plan
A great start to improving your company’s chances of surviving future disasters is learning about the different business continuity threats out there, such as:
1. Health incidents
According to the 2021 BCI Horizon Scan Report, health incidents were the second largest disruptor in 2020. Many people fell ill with COVID-19 and/or struggled with mental health issues as a result of the pandemic. These prevented them from performing at their best or even getting any work done, leaving many businesses understaffed. This resulted in poor business outcomes, such as revenue loss.
Other health incidents include those brought about by workplace safety hazards (e.g., machine malfunction), which threaten employee well-being and productivity.
2. Natural disasters
Natural disasters can affect business operations in different ways, depending on their severity and the areas they affect. Earthquakes, floods, and blizzards, for example, can damage infrastructure and result in power and internet outages. Fire can burn down your office building, supplies, and equipment.
- Hurricane Laura ($19 billion)
- Western wildfires ($16.5 billion)
- August Midwest derecho ($11 billion)
- Hurricane Sally ($7.3 billion)
3. Power outages
Most organizations rely heavily on electricity for their operations. Manufacturers, for example, use electricity to run their machinery. Restaurants need electricity to keep their freezers cool. Electricity also powers office PCs and hospitals’ medical equipment. During a power outage, businesses are forced to cease segments of or all of their operations, negatively impacting their bottom line.
Unfortunately, according to PowerOutage.US, an aggregator of utility blackout data, utility customers experienced 1.33 billion outage hours in 2020, which is 73% higher than in 2019.
4. Hardware or software failures
Most companies utilize IT to facilitate business. For instance, they turn to banking or digital wallet apps to securely receive payments from customers. They use customer relationship management software to record all client interactions from various communication channels.
Therefore, critical IT system failures may cause your operations to grind to a halt. For example, if your business’s data servers malfunction, your employees won’t be able to access company files and complete their tasks.
5. Cyberattacks and data breaches
There are many types of cyberattacks that can paralyze your operations. A distributed denial-of-service (DDoS) attack, for instance, floods your web servers with large volumes of traffic. It can slow down your servers, crash your website, and keep you from responding to your customers’ requests.
A ransomware attack, on the other hand, blocks your access to company data or IT systems until you pay the ransom demanded by the attack’s perpetrators. Ransomware is extremely disruptive, causing businesses an average of 23 days of downtime. In fact, many hospitals that fell victim to ransomware had to suspend patient care operations.
In many cases, cyberattacks also result in data breaches. If you’re subject to stringent compliance requirements and you fall victim to a data breach, your company will likely be investigated by industry regulators. This may force you to scale down or cease your operations for the duration of the investigation. You may even be slapped with hefty fines, which can drain your company’s finances.
Make sure your business survives disasters by availing SpectrumWise’s business continuity service. You’ll get a step-by-step guide that will help you quickly resume normal operations after a catastrophe. Schedule your FREE consultation today.