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Canadian firms not allocating enough on business continuity

Aug. 15, 2007

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According to a recent study performed by IDC Canada, on average, Canadian companies aren't allocating sufficient capital investments and resources towards business continuity.

The IDC added that, of the majority of the companies that were surveyed, over 90 percent agreed more resources should be allocated towards business continuity.

Conducted two months ago, the survey polled Canadian IT and business counterparts from large and mid-sized companies across a broad mix of vertical industries including financial, public sector, manufacturing, distribution and infrastructure.

David Senf, a director of software research with IDC said "this blatent lack of preparedness shows a real disconnect between executives' number one concern of IT reliability and uptime, and what these same executives are actually encouraging the organization to do. It's an important area for them, yet they're cited as one of the reasons why Canadian companies aren't doing more."

"There's not a lot of leadership occurring among Canadian managers to push their organizations to do more. In other words, Canadian firms feel that they're not doing enough," added Senf.

"Overall, there are ample reasons to test and exercise a business continuity plan," said Marv Wainschel, director of education at Eagle Rock Alliance Ltd., a West Orange, New Jersey-based management consulting firm specializing in business reliability planning.

Testing helps the company to practice its plan, generate awareness among participants who will be carrying it out, and allows the organization to actually determine if components of the plan are working in the first place.

Wainschel said that companies should ensure they can recover lost data, bring back a process on a particular machine, and switch the network if need be.

The admission that business continuity requires more attention is no surprise considering the level of preparedness, or lack thereof (!) found across the sample. In particular, close to 24 percent of companies surveyed said they have a plan that's actually been tested, while about 29 percent said they have an untested plan. Approximately 32 percent of the remaining firms surveyed said they have an ad hoc plan, while 11.8 to 13.2 percent said they have no plan at all.

Wainschel said that "some people don't even consider part of business continuity planning at all. He added that business continuity can also encompass different levels of resolution management like quality assurance, and data security.

Wainschel said the four percent of IT budget allocated towards business continuity cited by respondents probably doesn't include resources allocated towards continuity at the production level, such as maintaining duplicate processing ability at a remote site, and the replication of data.

To a certain degree, company reputation and financials were also among some of the concerns. These business areas would naturally fall among the top focal points for any company, agreed Wainschel. "Usually, the mission of any company centres on the strength of their customer service, customer relationships, their financial strength, reputation issues in their own industry, and their ability to conform to legal requirements."

Additionally, at the very bottom of the list of business area concerns, was regulatory compliance, although that may change as Canada's compliance legislation becomes more stern, said Senf. "But as it stands, regulatory compliance is not a big issue that Canadian firms are worried about."

The IDC study also found that among companies with business continuity plans, maintaining customer service was the area of the business that was of most concern. However, that concern was more pronounced among mid-market companies who typically employ a more tactical focus, compared to the "complete picture" approach of large organizations, said Senf.

IDC's research also identified that IT executives weren't as in tune as their business counterparts to the importance of business continuity planning. This makes sense given the areas of concern acknowledged by respondents, said Senf, because business executives generally have more direct interaction with customers and financials.

In the last twelve months, Senf added that the majority of Canadian companies have experienced a disruption of some sort, be it IT or weather-related. However, despite this, "most organizations are reactive than proactive," he said.

Not surprisingly, getting organizations to become more aware of the importance of business continuity planning is unfortunately often driven by the severity of the impact of a disaster, added Senf.

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Source: IT World Canada