Business continuity is a crucial concept in financial firms that deals with minimizing disruption to business processes. A Gartner report reveals that 40% of companies that lack a continuity plan will not reopen after a major calamity. If you operate a business, it’s time to embrace a business continuity strategy to succeed. Read on to learn about key aspects of the RIAs business continuity plan with an emphasis on the need for continuous operations.
Risk Assessment and Analysis
Part of planning for continuity involves recognizing possible threats to an organization’s operations. In a study and article published by Deloitte – financial firms experience certain risks such as cyber risks, operational risks, and external risks including the changes in laws and regulations that specifically affect advisors. It is therefore important to be able to assess these threats relative to your services and compliance. Risk management means looking at different parts of your RIA (Registered Investment Advisor) business to find and address areas that might be vulnerable. This helps ensure your business continuity plan covers all potential risks.
Business Impact Analysis (BIA)
It is not possible to carry out a continuity plan without conducting a Business Impact Analysis (BIA) as it helps identify potential effects of disruption and interruption to essential business operations. Analyzing the map will uncover which processes are vital to your firm and what will happen if their execution is impaired. For instance, determining the effects of downtime on the services delivered to clients and the revenue lost will help inform the ways in which the situation can be rectified. The BIA allows your RIA business continuity plan to focus on reducing the amount of time the business operations will be inoperable and minimizing potential financial losses.
Developing a Continuity Plan
The incorporation of recovery strategies into financial services is considered an essential part of business continuity. These strategies should comprise the plan that defines the specific steps for the resumption of the corporations’ crucial operations at a faster pace. For instance, it is possible to plan the availability of additional channels of communication and emergency means to guarantee that clients’ services will not be affected. Furthermore, there is a specific RIA business software out there that can be incorporated to make handling and conducting business continuity plans more straightforward.
Testing and Maintenance
Execution and updates on the continuity plan are critical so that your program can remain relevant as planned. The PwC study recommends that organizations test their plans more often than other organizations do because this makes them more ready for disruptions. Drills and simulations should be carried out frequently because they reveal the plan’s weaknesses and allow for its refinement. This is why it is imperative to keep your plan updated against industry standards and new threats that may emerge in the world of finance.
Is Walking Alone Enough to lower the risk of disease?(Opens in a new browser tab)
Wrap-up
In conclusion, risk assessment, business impact analysis, oriented recovery plans, and testing are major components of efficient business continuity for the financial industry. Thus, incorporating these elements will allow your firm to persist through disruptions and remain responsive to deliver the necessary services. It is hence important to prioritize and implement efficient business continuity plans for RIAs to enhance stability in the financial sector.
Discussion about this post