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Asia-Pacific businesses ill-prepared for disaster

Media Release
11 March 2004

Asia-Pacific businesses ill-prepared for disaster

Fewer than 35% of the businesses surveyed in a recent KPMG Asia-Pacific Business Continuity Management Benchmarking Survey have organisation-wide business continuity plans in place and almost one-third have no plan in place at all.

Business continuity management identifies, assesses, and manages events that may have a significant impact on an organisation’s business operations.

“This indicates that organisations are not undertaking structured risk assessments and may be speculating about the threats they are spending money on – and possibly leaving themselves exposed to the things that will hurt them,” says Rupert Dodds, KPMG's Wellington Director of Information Risk Management.

“There’s an increasing awareness in the Asia-Pacific business community that business continuity management is an important issue, however the focus might not be in the right areas. The more typical approach to business continuity focuses on natural hazards and terrorism, rather that internal operational or supply chain threats to the provision of goods and services.

“Nowadays, systems availability is seen as strategic in industry sectors such as financial services, infrastructure and government, and information, communication and entertainment. Loss of systems availability tarnishes an organisation’s reputation for customer service, and can lead to loss of new and existing customers within minutes.”

Mr Dodds says that 21% of the survey respondents estimated downtime losses of more than USD50,000 per hour and have a downtime tolerance of seven hours or less. To minimise potential losses, some organisations are choosing to invest upfront with alternate processing facilities (66%). Of those with recovery facilities, 34% of these are fully equipped “hot” sites or partially equipped “warm” sites (42%).

“However, the survey also revealed that organisations are failing to test their continuity plans, so money spent on planning and continuity infrastructure, like recovery centres, will not return value if these investments fail to meet the true business needs.”

Mr Dodds says that organisations should be testing their plans regularly, or commission independent assessments designed to review the plan and ensure its scope remains current and it is workable in practice.

“Planning after the disaster has struck is not an option.”

ENDS

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