Business impact analysis execution common approaches

Approaches to business impact analysis (BIA) differ by organization. The BIA process will vary based on industry dynamics, business complexity, use of technology, frequency of change and management style. The four main elements of theBIA are scoping, data collection, conclusions and reporting.

• Scoping: This includes information technology and/or business functions. It may be internally focused,or it may include critical business partners, vendors and customers. The scope of the BIA drives all subsequent analytic efforts.

• Data Collection: Data collection is most effective when done in group-facilitated sessions and one-on-one interviews. Questionnaires and a review of management reporting also can be efficient in certain corporate cultures.

• Conclusions: In some organizations, quantitative finds drive the process, whereas in others, qualitative impacts are just as important.

Types of impacts that should be considered include:

• Work Stoppage and Idle Workforce
• Regulatory Violations
• Noncompliance
• Financial Loss/Delay
• Loss of Stakeholder or Investor
• Confidence
• Reputation Impairment
• Environmental, Health and Safety
• Impairment
• Loss of Market Share
• Lost/Delayed Sales (Margin)
• Opportunity Costs
• Cash Flow Interruption
• Financial Control and Reporting
• Exposure
• Customer Service
• Strained Vendor Relations
• Employee Morale/Retention
• Negative Market Reaction
• SLA/Contractual Noncompliance

• Reporting: Text versus graphs, reports versus presentations. Corporate culture and audience should determine the exact format to ensure findings are understood and actionable.

Regardless of the approach, the BIA is a management owned initiative. The results must be accepted by the executive management team before the rest of the project can effectively take place.

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