Business continuity, contingency planning and disaster recovery: What’s the difference?

Sometimes, unforeseen events can disrupt a business’s operations without notice. Your preparedness and response are very important at this time. 

Some businesses are prepared for these interruptions and have clear guidelines for returning to ‘business as usual’ with minimal downtime. Others are less prepared and suffer knockoff effects that can take a long time to recover from. 

Businesses must prepare for disruptive events with strategies that outline how to maintain core operations and recover quickly. This is where the fields of business continuity, contingency planning, and disaster recovery come in. 

These help businesses minimize the impact of catastrophic events by creating a detailed plan for operating through disruptions and returning to normal as soon as possible. It may seem like the three terms are interchangeable and refer to the same process, however, there are core differences between them. 

In this guide, we’ll examine why your business should plan for disruption, and the difference between business continuity, contingency planning, and disaster recovery.

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What is business continuity?

Business continuity outlines how a business will continue to operate during and after a disruptive event. Ideally, with as little downtime as possible. 

Disruptive events can refer to anything from natural disasters, war, or theft to cyber-attacks, the departure of a vital employee, or negative publicity. The COVID-19 pandemic highlighted a real need to be prepared for the unexpected. Business continuity can also plan for smaller events such as extended power outages.

A business continuity strategy can take into account things like:

  • How a business will operate if it’s forced to relocate premises
  • Plans for what to do if a supplier/contractor that’s heavily relied on leaves or is bankrupted
  • Redeploying staff to different roles
  • Working from home guidelines
  • Data backup site locations & providers
  • Maintaining operations during both short-term and long-term disruptions

A business continuity plan is more comprehensive than a disaster recovery plan and will contain detailed contingencies for all aspects of the business.  

What is disaster recovery?

Disaster recovery plans for how a business will return to normal after technology-related disasters such as power outages, natural events, cybercrimes, or human error (for example, accidental deletion of data). It’s essentially a guideline that outlines what measures a business will need to take to respond to events and transition back to regular operation as quickly as possible. 

Disaster recovery is usually a key component of a business continuity plan and focuses on restoring normal business function. It can take into account things like:

  • How to re-establish office productivity as quickly as possible
  • Manual workarounds when computer systems are down 
  • How to recover from data loss or IT infrastructure failure
  • Business cybersecurity measures
  • Who will form the crisis management team 
  • A recovery timeline 

Many companies have data backups in place, however, this does not constitute proper disaster recovery. Data backups are not useful when there are power outages or a natural disaster preventing access to that data. A proper disaster recovery plan should consider these circumstances and provide a strategy to work around them. 

What is a contingency plan?

A contingency plan prepares businesses for disruptive events that could significantly affect their delivery of products and/or services. This could include the loss of a vital employee or significant supplier. 

Contingency plans usually consider risks that can affect critical business operations, such as cyber-attacks, data leaks, or supply chain issues. A contingency plan typically includes things like: 

  • Events that trigger contingency measures
  • A response that will be taken depending on the event
  • Key tasks involved
  • Rough timeline for restoring normal operations

What is the difference between business continuity, contingency planning, and disaster recovery?

Business continuity, contingency planning, and disaster recovery can sound very similar, and in many ways they are. The key difference between the three is when they take place:

  • Contingency planning happens in advance to prepare for future incidents
  • Business continuity provides a temporary solution during an incident
  • Disaster recovery focuses on returning operations back to normal after an incident has taken place

Why your business should plan for disruptive events

If your business faces disruption without a proper plan in place, knock-on effects can be catastrophic. Taking the time to consider business continuity, contingency planning and disaster recovery can benefit your business in numerous ways by minimising the consequences of interruption.

1. Prevent financial loss

The most obvious result of disruptive events is financial loss. As a business is unable to continue delivering products and services while dealing with the incident, its bottom line can take a hit. Instead of focusing your resources on coming up with a plan during the event, plan ahead so that you can restore business function as quickly as possible. 

2. Peace of mind

Taking the time to create a business continuity, disaster recovery, or contingency plan provides peace of mind to employees. Knowing that there are clear policies and guidelines to follow in times of need relieves pressure and mitigates chaos during disruptive situations. 

3. Edge over competitors

Being able to restore normal operations as quickly as possible can give you an advantage over competitors as they struggle to figure out the situation. This can help your business stand out as a trustworthy and reliable industry leader, especially in the eyes of customers.

Start planning for disruption before it’s too late

Don’t wait until you need it, prepare for disruptive events before they happen so that your business can be guided through interruptions swiftly and calmly. We can help you plan for unforeseen circumstances, including cybersecurity and incident response to minimise data loss and downtime.

Get in touch with our team to find out how we can help you implement a business cybersecurity plan that allows you to operate with peace of mind.

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