Traditional Business Continuity Plans (BCPs) are no longer suitable for building sustainable operational resilience in modern financial markets. Adopting a modern, holistic approach to resilience as an agile and continuous process is an important step towards a robust framework. This involves shifting the focus from the simple recovery of ICT systems to protecting the end-to-end processes, protecting end-to-end services and improving the customer experience.
Why Should Firms Adopt a Holistic Approach instead of a Traditional BCP?
Business Continuity Plans (BCPs) have traditionally focused on protecting internal processes and preventing failure within the ecosystem of the firm. This approach has several shortcomings, as this form of BCP doesn’t consider the wider implications of systemic market risk. A holistic approach assumes that failures will happen and equips firms with the necessary blueprint for recovery. Where the traditional BCP used standard recovery time objectives, a more holistic resilience framework will focus on customer-centric impact tolerances such as safeguarding the customer experience and protecting the provision of customer-facing services.
How to Implement a Holistic Operational Resilience Framework
As with all change management processes, several key ingredients must be present to achieve a successful outcome:
- Tone from the top: The board of directors and senior management must demonstrate their commitment to operational resilience and ensure this is cascaded throughout the firm
- Senior leadership engagement: Senior management should determine clear lines of accountability, engagement and open communication to ensure a successful process
- Identification of important business services: This includes the creation of a risk register compiled of the key dependencies for each important business service
- Supplier oversight: The entire end-to-end process should be mapped to include every interaction with third-party suppliers
- Lessons learned: Firms should prioritise embedding the lessons learned through blameless analysis, root cause analysis and the development of robust feedback loops
Strategic Benefits of a Holistic Operational Resilience Framework
There are many strategic advantages to the development of a holistic operational resilience framework in addition to the compliance benefits. Firms that demonstrate a commitment to protecting critical services and prioritising security will be able to build customer trust and encourage customer loyalty. Internally, the increased organisational agility and responsiveness will lead to more efficient allocation of resources to the most critical areas, providing a solid foundation for sustainable growth. Adopting a compliance-first mindset throughout the firm will bring benefits to staff and senior management, and the proactive engagement with regulators builds trust and confidence. The detailed insights generated from the complex end-to-end mapping exercise will also produce a distinct strategic advantage that is highly valuable for investors or for any potential M&A activity. Move beyond outdated continuity plans.
Speak to our experts today about building a holistic resilience framework that protects critical services.
