The past year demonstrates just how crucial operational resilience and agility is for banks in responding to change.
Banking has witnessed perhaps in just the past year a degree of change that might normally occur over a decade.
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Richard Cooper, Head of Financial Services at Fusion is ideally placed to discuss the crucial role operational resilience plays. Fusion is a leading provider of operational resilience, business continuity and risk management software and services.
Rich Cooper of Fusion speaks with RBI editor Douglas Blakey
Cooper tells RBI that trust and compliance are key aspects of a bank’s operational resilience strategy.
Says Cooper: “Being resilient means being able to fulfil your promise to your customers. It really is that simple. For example, access to cash is a simple concept. But it involves systems, people, physical locations and digital and organising how to transfer money to ATMs.”
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By GlobalDataOperational resilience is not about governance or compliance. It is bigger than that. Operational resilience keeps businesses in business.
Fusion mission: to build a more resilient world
In his global role, Cooper observes the benefits and rewards that strong operational resilience programmes bring.
Fusion’s mission is simply summarised: to build a more resilient world. Its data-led approach has been developed over the past 15 years. Specifically, it connects all aspects of operational resilience including cybersecurity, IT disaster recovery, crisis management, business continuity, third party management, and compliance holistically.
The Fusion Framework enables clients to not only identify risks and faults, but also address in real-time.
Business resilience is critical for the strategic success of every organisation. At stake are a company’s viability, brand equity, strategic objectives, financial undertakings and ability to compete. And that level of understanding at the C-level suite is essential. There is always the danger that senior executives focus on the challenges of growing the business and the bottom line. Meantime, the need to ensure business resilience is deprioritised and regarded as a distraction.
7 Misconceptions about Business Continuity Management
Cooper argues that there are seven common misconceptions about business continuity management.
1 We have a plan
With business continuity plans in hand – documented, reviewed and approved – it’s easy for executives to assume they’ve done what’s necessary to protect the business. But having the plans versus actually using the plans are two very different things.
Unless plans have been exercised under realistic scenarios, there’s no guarantee people will know how to respond. Lacking this organisational skill, many times plans are ignored. People simply people go into “scramble mode” seriously jeopardising a timely recovery and likely making the situation worse.
2 We have insurance, so we’re covered.
Insurance coverages can give the appearance that risks have been addressed and require no further attention. But insurance will never help to avoid the disruption, minimise the operational impact, or enable a successful recovery. Insurance will never compensate for brand impact and loss of shareholder value that can result from a serious business disruption.
3 We’re not going to spend that much money
Ironically many organisations are overspending on their efforts without achieving a truly effective business continuity programme. Programmes are left to struggle with a lack of executive sponsorship, inadequate tools, and ignorance and apathy from employees. They struggle to deliver value. The most expensive programmes are those that produce plans that no one will ever use.
Well-conceived programmes, with the right people making effective use of advanced business continuity management software will operate more effectively and more efficiently. Moreover, they are able to deliver superior results for the investments being made.
4 It won’t happen to us
It’s human nature to avoid thinking about such things. Yet it’s become indefensible for an executive to suggest that no one could have foreseen that a disruption could occur.
Natural disasters, cyber-attacks, acts of terror and serious weather events, can significantly impact an organisation’s ability to maintain operations.
These impacts are intensified by ever-tightening supply chains and ever-growing reliance on IT services.
5 We already have data backups, recovery centres, and cyber security measures
No amount of technology alone can ensure resilience and recovery. One can easily overspend in one area while ignoring investments needed in other areas of the overall programme. IT recovery plans must be comprehensive, current, and accurate. The plans must be exercised under a variety of realistic disaster scenarios. Risk and resilience teams must come together to identify effective ways to reduce or avoid risks altogether.
A comprehensive programme incorporates business continuity with IT disaster recovery to ensure a comprehensive approach to business resilience.
6 Our contract protections limit our liability
Another common misconception is that if you limit your liability, your business is protected. During an operational disruption, there are many stakeholders affected. If brand trust is tarnished because a potentially preventable issue has affected customers, shareholders, employees, or partners, contract protections may become immaterial to the challenge of repairing and restarting business relationships. Having a comprehensive business continuity program reduces impact and speed recovery in the face of adverse events. Avoiding a disruption to business can far exceed the benefits that contract protections alone provide.
7 We don’t have a complicated business, so we don’t need a formal programme.
Every business is complex in its own way. The true extent of the organisation’s internal and external dependencies isn’t revealed until a disruption occurs.
Scrambling to respond without a plan never works out as well. Should an adverse event occur, not having a business continuity programme means not understanding how to respond. And this applies no matter how simple one believes a business’s processes and dependencies are.
