Which of the following is a critical step when carrying out a business impact analysis (bia)

A BIA (business impact analysis) is essential in every organization. Often, companies don't allocate enough time or resources to identify risk factors properly – and instead dive straight into creating a recovery strategy. Below will help you learn more about what a BIA involves and how to conduct one.

Defining Business Impact Analysis

The BIA is a framework used to analyze the consequences of disruptions and how they impact your business. The analysis considers potential loss scenarios, the timing of disturbances, and the results affecting crucial products and services.

A risk assessment also examines the processes or activities supporting these disruptions. As a result of a BIA, organizations can plan recovery strategies alongside investments in prevention and mitigation strategies.

For instance, 68.5% of organizations fell victim to ransomware attacks in 2021. If your organization were to, unfortunately, be part of a similar statistic in the future, performing a BIA now could be the foundation for creating a business continuity plan that could help you prevent or at least mitigate these cybersecurity threats.

The Benefits of a BIA

A BIA is your starting point for your BCP (business continuity plan). It acts as a checklist to help you prepare your annual activities and can be beneficial in the following ways:

• Recovery process: Your BCP should include the procedures or highest-impact assets for all the functions listed in your BIA. These prioritizations will provide transparency on where you can improve the BCP.
• Organizes recovery: In a recovery situation, it's crucial to have a disaster plan that defines the highest prioritized tasks. A BIA accomplishes this for you. You can use it to rank each priority and procure an "order of recovery" list within your BCP.
• Prioritizes BCP testing:  Your BIA will prioritize the areas you'll be testing in your BCP. For instance, you may need to test critical assets annually and high-priority assets every 18 months.
• Measures BCP testing effectiveness: A BIA provides sufficient measures to evaluate the BCP testing effectiveness. You can compare testing recovery times to the maximum tolerable downtime (MTD). If recovery time takes longer than the MTD, you can reevaluate and make improvements.
• Provides a rational approach to the backup rotation: Helps you to understand whether your backups achieve the desired results of your recovery point objective. Your IT staff can use this information to set backup schedules and rotations.

How to Conduct a Business Impact Analysis

A BIA ensures your organization can survive if a disaster or crisis occurs. Once you complete a BIA, you'll learn the following:

• Critical business functions
• The impact of an interruption to those functions
• How long your business will thrive without performing the activities

Knowing how long your business will survive, you can define an MAO (maximum acceptable outage) period for every function. An MAO is the amount of time you have from when a disaster occurs to the time your business function must be operational to avoid financial loss.

To learn how to conduct a BIA, follow the steps below.

1. Identify the Scope of the Business Impact Analysis

Small to medium-sized businesses can involve all business functions when conducting a BIA. After identifying the processes you'll cover, you can meet with individuals you need to interview for the assessment.

These individuals are people who do hands-on work and are informed of the processes and vulnerabilities. One person you should make sure to include is someone from your IT department. Even when someone knows how to use the software, they may not know how the back end functions.

Once you've gathered all the critical business continuity information, you'll create a timeline for conducting your BIA. Doing this will help you stay on track and complete the following two steps.

2. Schedule Business Impact Analysis Interviews

After you've identified the scope of departments and activities, the next step is to schedule a meeting with each department's leadership team. Establish the value of conducting a BIA so they understand the purpose and importance of one.

Your management team may not realize the investment into the BIA process. Therefore, knowing the value will allow your team to have all the information upfront.

3. Execute BIA Interviews

The purpose of these interviews is to determine the activities each department performs. According to Business2Community, scheduled interviews take approximately 2-2.5 hours to conduct.

Furthermore, these activities should support the in-scope products and services. For each activity, gathering the steps necessary to complete the function, peak operation times, downtime, and dependencies required to perform one is essential. Consider documenting the following dependencies:

For each dependency, you'll need a description of their use, manual workarounds, and recovery time. Additionally, you should conduct a risk assessment by assigning the value for the likelihood of loss or the impact for every dependency.

Once you've collected your data, you can multiply your numbers to provide a risk rating. You can value each rating from 1 to 10 during the process.

Additionally, it helps to understand if any departments have experienced a disruption in the past. Knowing this information will merit stronger planning.

4. Document and Approve Each Department BIA Report

Upon completing each department meeting, you'll have a documented report showing the results. Using business continuity software will increase the efficiency of the process. It can automate the analysis for you and the functionality for further updates.

These reports should've captured all pertinent information and recommendations, such as recovery time objectives.

Once you've drafted the report, you'll distribute it to your staff and meet with participants to review it. During the meeting, you can make necessary changes and approve the narrative. Each department report will be essential to establish company-wide business continuity requirements for management to review and endorse.

5. Complete the BIA Summary

After each department completes its reports, you can finalize the BIA summary for management to review and approve. The purpose of this is to provide an overview of the key activities, requirements, and identified risks.

Additionally, the report allows you to make risk treatment recommendations. For instance, some applications may need to be restored within 24 hours after a disaster – depending on the BIA you've conducted.

After coordinating each department's BIA conclusions, you can present your findings to leadership. During your presentation, focus on the following:

• Revisit the products and services identified in the risk assessment
• Verify the established recovery times
• Present the key risks and recommendations for addressing them

It's important to prioritize these recommendations for leadership by focusing on accomplishing the correct level of resilience and the strategies to address the loss of resources.

Use Your BIA for Business Continuity Success

While a BIA often feels like you're ticking boxes, it can provide a ton of value for your organization. Going through this exercise with your leadership team will help align everyone on what's important to your business.

Remember that it's essential to make time for your business impact analysis. Taking action will provide you with better outcomes and help you stay on top of everything. Reach out to Agility today to get started.

Zac Amos is the Features Editor and a writer at ReHack, where he loves digging into business tech, cybersecurity, and anything else technology-related. You can find more of his work on Twitter or LinkedIn.

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Business Continuity Management is essential for every organisation in order to ensure that your business can survive even in the face of crises or disasters, and a Business Impact Analysis (BIA) is the foundation for any solid business continuity framework. A BIA is the step where you identify the processes that are most critical to your organisation. Often companies won't allocate an adequate amount of time or resources to properly identify these factors and instead jump straight into creating recovery strategies and plans. Start with a BIA, so you're covered. 

Upon completion of a BIA, you should know the following:

• Your organisation's critical business functions 
• The impact to your business if an interruption were to disrupt those functions
• How long your business could survive without performing these activities

By knowing how long your business can survive, you'll be able to define your Maximum Acceptable Outage (MAO) period for each function. The MAO is the amount of time from when a crisis happens to the time when a critical business function must be fully operational in order to avoid serious financial loss. To identify all the above takes time and the input from the right people, so it's not as simple as sitting in a room one afternoon and smashing it out (unless, perhaps, your company is less than 5 people).

A Guide to Conducting a Business Impact Analysis

Step 1: Identify the scope of your BIA

Especially if your organisation is large, it may not be necessary to involve all parts of the company in your BIA initially, or at all. Before you start mapping out your organisation's critical business functions, determine which parts of the business are most critical and focus on those. Business 2 Community recommends keeping your scope small and manageable. For large companies, this means limiting your review to the most significant 7-10 business departments or units.

Once you have identified the departments you'll be covering, figure out the people you'll need to interview for the assessment. These should be the individuals who are doing the hands-on work and therefore are most knowledgeable of critical processes and vulnerabilities. They are the most likely to be able to give you the accurate detail you need. If and when there is technology involved in these parts of the company, make sure to include an IT person in addition to the person who does the job, because even if someone knows how to use the software, he or she may not know how it works on the back end. Lastly, set up a timeline for conducting and finalising your BIA. Not only will this keep you on track but it will also help with the next two steps. 

Step 2: Establish the value of the BIA with your management team. 

If you're conducting a BIA, hopefully that means that your organisation understands and supports the need for business continuity management and having a business continuity plan. However, they may not realise what goes into the BIA specifically, so once you've determined the scope, who will need to be involved and the timeframe, present your plan to your management team, so they realise the investment into the BIA process, the value that will stem from your work and have all the information upfront. 

Step 3: Schedule and prepare for your BIA interviews 

According to your timeline, set up time (allot about 2 hours) to interview those you've identified as the most knowledgeable about every process they handle and the potential impact it would have on the company should a disruption happen. Prior to the interview, try to gather basic information about the sector of the business you'll be reviewing such as number of people who work in it, an overview of their processes and systems and hours of operation. This will help make the interview be smooth and efficient. 

Step 4: Host your BIA interviews

In hosting meetings, your goal is to understand the critical functions of your organisation's core business departments and the potential impact if and when those processes or systems get disrupted. To reach this goal, you should be asking the following questions.

Following every meeting, you'll want to share a recap with the person you interviewed, so they have the chance to review and verify all the information is correct.

Step 5: Analyse the data and prepare a report

During this step, review all the data you've gathered and assess what functions are most critical as well as sort through any findings you aren't clear about. Compile your results into a report. This should include:

• An overview of the BIA process
• Your ranking of critical business functions
• Any additional findings you think should be mentioned
• An action plan to address the highest priority critical business functions
• A conclusion
• Appendixes with any supporting information (those you interviewed, summaries of your meetings, etc.)

Once you've created this report, share it with your management team and set up a time to review and address any questions. With their approval of either all or at least your most important recommendations, you and organisation will not be in the best position possible to build your recovery strategies and plans. 

For assistance with your company's business continuity management, software like RiskWare's Business Continuity Module can be incredibly helpful in facilitating and organising your business impact analysis process, among other elements of your BCM framework.

Let's organise a time to speak to one of our Risk Specialists and you can learn why millions of users around Australia trust RiskWare to manage their organisations Risks.

To learn more about how RiskWare is making the world a little less risky, visit us at RiskWare.com.au.