Tom Fricano

Wednesday, 17 March 2004 11:37

Planning for business continuity

How much data loss can your company experience before its material impact on the business is disastrous?

In addition to the challenges of complying with the Sarbanes-Oxley Act, which holds corporations responsible for the safety of their business data, CEOs, CFOs and CIOs face the very real threat they've faced for generations -- disruption of business operations caused by forces outside their control.

Business continuity planning has become increasingly important as business leaders come up with contingency plans for dealing with age-old worries such as storms, floods, earthquakes and fires, as well as new threats including security breaches, sabotage, facility outages, logistical failures, virus attacks and terrorism.

 

Be prepared

Imagine the damage a 24-hour site outage would cause to your company, or what would happen if a virus deleted or corrupted mission-critical data. Smart companies have considered these threats, performing self-assessments to identify vulnerabilities, anticipate threats and determine how long it would take to recover from disaster.

It is far better to review and test processes to find out if you are adequately prepared to protect critical data than to be forced to figure out how you will recover lost or corrupted information during or after a disaster. If you don't have one already, a business continuity plan needs to be implemented.

The creation and maintenance of a sound business continuity and disaster recovery plan can be managed with a series of simple steps. When making a plan, consider the potential impact of a disaster and your responsibility to be in full compliance with Sarbanes-Oxley.

Teaming up with an experienced business continuity planner will help you formulate the most efficient and effective approach to creating and maintaining a plan.

If you are reviewing your existing plan or creating a new one for your applications and infrastructure, we recommend you ask two vital questions.

 

1. What amount of data loss are you prepared to handle? Zero hours of accounting data? Four hours of sales order processing? Twenty-four hours of customer service records?

 

2. How much time can you wait to recover normal operations for these systems and applications? None? A day? A week?

 

The accompanying chart explains some standard thresholds and the operational implications of these answers.

 

Partner for security and success

As disaster recovery demands grow more complex, many business leaders choose to partner with experts in business continuity planning who can determine the most effective solution for their particular application and infrastructure needs.

Your answers to the questions above will determine necessary levels of service, technology and infrastructure selection, and the investment you will need to make. As a rule of thumb, the lower your threshold for data loss and recovery time, the higher the service level and investment you will need.

According to The Gartner Group, less than 50 percent of companies have fully tested their disaster recovery plans. That's a frightening prospect. As the value of a corporation's data information grows, vulnerability to new threats such as hackers, viruses and terrorism are too great to leave unchecked, and it's too late if you wait until disaster strikes. Whether implementing your business continuity plan internally or outsourcing, companies today can't afford not to be prepared for a crisis.

Tom Fricano (tfricano@bravepoint.com) is a director at BravePoint, a supplier of e-business and enterprise IT solutions to mid-market companies. Reach him at (770) 449-9696.

Thursday, 18 December 2003 06:47

ROI is back

In the dot-com era, cost justifications were seen as a hindrance to progress. It was assumed that the benefits of a purchase would always be realized in some magical way, and that an ROI study would only slow the process down.

Things have changed.

Budgets have been slashed and purchasers have been keeping a tight rein on corporate purse strings, even though there continue to be compelling reasons to invest in e-business services and applications.

If you're looking to buy or sell an e-business solution, you need to be able to show justification for the purchase before you make your pitch. For this article, consider a customer self-service solution.

This allows your customers to use the Internet to access certain services you currently provide in other ways. Good self-service offerings usually include at least some of the following features.

* Information: Online product catalog

* Ease of use: Streamlined order entry process

* Information accessibility: The No. 1 customer requested feature

* Availability: Any time via the Internet

* Personal: Flexible for each customer

* Communication: Automatic e-mail notifications

* Global: Multilanguage, multicurrency

* Integration: Direct to back-end system

* Security: Secure, advanced model to conduct transactions

Exploring the benefits

* Strategic benefits. Include ways your e-business application can bring revenue into the company by attracting and retaining customers or creating new sales channels.

* Operational benefits. Demonstrate ways your company can increase profit margins by improving efficiency and lowering costs.

Calculate the value of your strategic benefits in dollar terms, and make modest estimates. For example, your online store may generate a modest 5 percent increase in revenue, but that could be an attractive amount for any company with annual revenue in excess of $1 million.

Add to the dollar amount of your strategic benefits the savings you will see through operational benefits, such as reduced headcount, reduced errors, reduced cycle time and reduced inventory. You should have a pretty compelling argument.

Where's my ROI?

The true cost of, and return on, your e-business investment depends on the type of business you are in and the level of integration you want from your internal systems.

When considering costs, don't forget outlay for software, implementation, customization, training, ongoing annual maintenance, additional bandwidth and the salaries of any additional IT personnel you may need to hire to administer your e-business application.

Now, measure these hard costs against your strategic and operational benefits and you should have a pretty clear view of your e-business ROI.

Add it up

An ROI analysis can be an effective tool to aid the decision-making process, whether you are buying or selling an e-business investment. Further, it is not hard to get started.

Think of today's business challenges and the ways an e-business solution can help solve them. The ROI analysis will validate your decision based on benefits versus cost.

BravePoint has a simple ROI document that can help you pull this information together. Email us at roi@bravepoint.com if you would like a copy.

You'll be surprised at how easily it all adds up. Tom Fricano (tfricano@bravepoint.com) is a director at BravePoint, a supplier of e-business and enterprise IT solutions to mid-market companies. Reach him at (770) 449-9696.