Business continuity critical
SMEs are generally also not well educated about business continuity. THE OLD ADAGE about backups and disaster recovery plans only mattering when data loss has already occurred still holds true. Allen Smith, CEO of Continuity SA says in the company’s experience most South African small to medium-sized companies have little or no business continuity and disaster recovery plans in place. “And those that do often assume running backups on their server is all they need to effectively manage the risks their companies are exposed to,” Smith says.
Things couldn’t be farther from the truth. Ironically, Smith says SME companies actually need business continuity strategies more than their enterprise counterparts do. “When large companies suffer a disaster they usually have the money available to recover and continue operations quickly. However, SMEs generally don’t have the money to spare and a disaster can easily lead to the ultimate failure of the company.”
Furthermore, Smith says SMEs are generally also not well educated about business continuity. “Because of their limited spending capacity, large continuity service providers are unlikely to spend the time required to educate them,” he says. The result is that SME managers are likely to judge their need for business continuity from a cost versus immediate return perspective.
“The challenge for the SME market is that managers and owners spend their time focusing on the generation of revenue and keeping their heads above water. Risk management is something done when time and money permit,” Smith says. Where larger companies are forced to pay attention to risk management due to their need for regulatory compliance, both in terms of national legislation and the best practices outlined by their industry verticals, as yet the same isn’t true for SMEs.
Besides the need for compliance with industry best practices and the requirements of their business partners and customers, SMEs aren’t under massive pressure to take firm steps towards risk aversion. “Forcing the issue and compelling SMEs to focus on risk management via legislation might well be a positive move for SA companies,” Smith says.
Apart from the market rallying behind legislation that will force SMEs to take backup, recovery and disaster recovery seriously, Smith says the business continuity industry also needs to be more active in highlighting the benefits of those practices to small companies.
“The fact is that effective business continuity planning helps large and small companies operate more efficiently and thereby increase their profitability. And in the event of the SME being sold any improved efficiencies can ensure a higher purchase price. The buyer is also generally assured they’re buying a wellrun organisation.
“Ultimately, business continuity can no longer be seen as something only applicable to enterprise companies. Any company that wants to survive an unexpected event needs to understand where it’s vulnerable and mitigate those risks through professional, repeatable processes.”