​Figures at your fingertips: A 'starter for ten' to answer the ROI challenge

Blog post   •   May 12, 2016 09:44 BST

Let’s be honest, we all get annoyed at the constant challenge to justify our existence. I don’t hold with the commentators who say that business continuity is always a cost centre, insurance buy or grudge purchase. It makes me mad... but that’s not difficult.

So inevitably, we all have to talk the language of value and savings. This is a shame because incredibly important elements like safety of staff in emergencies, public perception, legal compliance and positive risk taking can all get pushed to the sidelines when there’s pressure to ‘put a figure on it’, as these softer elements are notoriously difficult to quantify. My advice is don’t pander to the bean counters and do shamelessly exploit the soft targets too as part of any justification. But that’s a different conversation to this one - So if you do need some hard numbers then read on...

Here are a few ideas for ‘fingertip figures’ - one for each finger if you will, to amaze your colleagues and turn the discussion into one about how you are really indispensable, in case they hadn’t realised. These are taken from the coal face of real life and incidents… the experiences that your executives may not have seen and from which they are cocooned by their middle managers. Move that discussion on from mere expense to pure savings, losses avoided and returns.

I don’t bother with the reason for the disruption here: fire, flood, and supplier issue, whatever… you add that bit based on your own organisational aims, risks and recent experiences. And don’t allow anyone to tell you it can’t happen here… make sure you sell the function long and not short! Don’t be shy in ‘annualising’ any figures based on the incident rates as well as also using the single incident or ‘spot’ figures.

  1. Reputation reputation reputation: It’s a reputation thing... what’s 5% of your capital and share value on the markets? What if you lost that 5% due to losing the trust of your customers or badly disappointing them and having to pay them reparation or compensation? What could that compensation amount to? Remember Mitsubishi and BMW!
  2. Customer is king: What’s the value of one day of lost sales from customers not being able to contact you through all those whizzy new channels - web, chat, twitter, email … I could go on… and I haven’t even mentioned the humble telephony call centre. It’s all blended now! Unified Communications it’s called …. make sure you know both how and through whom your customers talk to your business and an averaged value of business written in one day. Then, which days are the hot spots?
  3. Recovery royalties: What’s the value of the losses avoided because you were able to recover that business process much faster with a pre-tested plan? Any time saved = costs saved and avoided... direct and indirect. Heck, you are so good that you actually managed to avoid the disruption happening in the first place, or growing to a full blown event, because the Recovery Team met as soon as the potential arose... you ‘headed it off at the pass’... what was the value of that bigger event not landing?
  4. Crystal ball: Your predictive powers are legendary! How many times did the exercise scenario you facilitated suddenly become prescient when the real thing threatened or landed later? The team knew immediately what to do and who to involve, saving time in the recovery and avoiding larger damages and impacts. Remember; don’t let anyone say ...’it can’t happen here’.
  5. Contract creative: What did you save on that review of the off site recovery contract this year? Get a fixed price for three years? Knocked out the unnecessary seats and systems because your Impact Analysis is so good? What’s the difference from standard market rates for the contract life? [Incidentally - did the last time you used the off site recovery for real actually pay for itself? Yes? Good – then make sure you tell that story. How many days use would do that? What do you think would be a good figure for this? Two days, three, five, more?]
  6. Resource reasonable: Remember the costs saved on IT Systems resources and availability and resilience measures: due to the business owner accepting a longer but reasonable RTO after your intervention - instead of living with ‘I can’t do without it ‘or ‘I need it in two hours’. Did you align your business process RTOs to IT System RTOs or vice versa and save on costs?
  7. Champions on the field: So you’ve embedded the BC lifecycle using champions for analysis and plan maintenance etc. out there in the business - they understand their business activities intimately. What would that equivalent work cost in full time employees or contractors?
  8. Love your neighbours: Those local mutual aid arrangements with neighbours - and cross unit relocation plans - how much is that worth in the alternatives - off site service costs and welfare costs during any emergency? Over one day, two days?
  9. Analysis anticipation: Your BIAs are awesome - How many operational risks did you uncover during your BIAs - which are now on the organisation's Risk and Governance Register for effective treatment so they never materialise? You pointed out some rather embarrassing holes in the operation! What if they had landed: did they have an annual probability value of 1 = certain? What costs avoided here? Halve this number for a probability of 0.5, i.e. once every two years etc.
  10. Brilliant value: Now compare the annual total of all the above with the gross salary of your BC Team – one is peanuts in the comparison - and it won’t be the sum saved! And I bet no one would agree to pay you an annual bonus based on 10% of savings either! If anyone has tried this tack, I really want to hear from you!

Discuss: I hope some of these sound at least familiar, or prompt you to look again at the good work you naturally do, for which you can then express a value. I’m certain you have your own golden keys to the justification debate – share them!

Neil Wainman MBCI is the Business Continuity Manager at E.ON.