Page 212 - (DK) The Business Book
P. 212
210
TO BE AN OPTIMIST…
HAVE A CONTINGENCY
PLAN FOR WHEN ALL
HELL BREAKS LOOSE
CONTINGENCY PLANNING
n business, things rarely go as
IN CONTEXT planned. Companies have to
I prepare for sudden changes to
FOCUS
markets or the environment to
Operational risk
ensure that day-to-day business can
KEY DATES continue “when all hell breaks loose,” He who fails to plan
1947–1991 Governments as US professor Randy Pausch put it. is planning to fail.
and multinational businesses Contingency planning sets a Winston Churchill
develop contingency plans course of action to deal with a crisis, UK former Prime Minister (1874–1965)
for potential nuclear attack whether this is industrial (such
as the financial collapse of a key
during the Cold War.
supplier), human, natural, or technical
Late 1990s Countries around in nature. It requires identifying
the world put contingency possible disasters, assessing
plans in place for the Y2K the likelihood of occurrence, and
or “millennium bug”—an developing a course of action to In 2011, a devastating earthquake
anticipated computer failure minimize the impact. Having a struck Japan’s east coast, followed
due to the millennial date plan enables a company to manage minutes later by a large tsunami.
change (from 1999 to 2000). the crisis and recover quickly. The Japanese government’s
contingency plans for earthquakes—
2010 A lack of contingency
Identify key tasks from earthquake-resistant buildings
planning leads to closure of
A contingency plan has to be based to an early-warning system and
northern European air space
on critical business activities. rapid-response coordination—saved
for the first time, following the
A utility company that relies on countless lives. Many companies,
eruption of a volcano in Iceland.
a call-center team to manage such as NEC, were able to restore
Businesses lose revenue due to customer inquiries should identify operations within minutes thanks
the transportation restrictions. alternative premises in case of to their prepared emergency plans.
2012 Due to the ongoing flood. A marketing company Even natural disasters as large as
planning for the same incident may earthquakes can be managed with
financial crisis, businesses
need to allow staff to work remotely. good contingency planning. ■
around the world draw up
contingency plans for the
See also: Managing risk 40–41 ■ Learning from failure 164–65 ■ Avoiding
breakup of the Eurozone.
complacency 194–201 ■ Scenario planning 211 ■ Coping with chaos 220–21
