Risk Assessment and Business Impact Analysis
To fully protect a company from disasters, threats, security risks and be fully ISO-compliant it is good practice for them to have both a Business Impact Analysis and Risk Assessment which is vital to any BCM and Disaster Recovery Plan.
Understanding the differences between Business Impact Analysis and Risk Assessment
Although the two practices complement each other and the foundations to any good Business Continuity and Disaster Recovery Plan and have some common grounding and overlap they are different processes each contributing necessary information towards an efficient Business Resilience Plan.
Is a valuable process by which potential threats are identified and various actions are put in place to either prevent or to minimize the risk thereof by an acceptable degree of loss, downtime or failure.
By systematically managing these potential risks with various resources such a patching of Windows systems, upgrading of alarms, installing better VCR security systems, etc.
Risk Assessment focuses on all potential risks and what their chances of occurring are and it focuses on the potential impact of events.
Risk Assessment also takes the potential risks and breaks it into whatever components may make up the risk, failure, error or causality.
Business Impact Analysis
Uses RTO’s (Recovery Time Objectives) to calculate and assess how a business would fair during downtime. By assuming worse case scenarios and what the organization would stand to lose under certain conditions.
The Business Impact Analysis or BIA is more concerned with the impact on the stakeholders due to limited or no normal services and what the recovery time would be as to the acceptable tolerance level of such an event.
BIA makes use of various granular statistics and company data such as markets, account impacts etc.
By considering the entire companies operation and what it stands to lose during any disaster, event or crisis that would bring these operations or parts thereof to a stop.
Insight into BIA and Risk Assessment
Risk Assessment is usually done after the BIA has been done to priorities and measure the risks identified by the BIA.
The BIA, on the other hand, does not rely on the information from a Risk Assessment for any analytics to be processed.
With the different ISO standards that govern the BIA process and industries adopting these standards as stricter and tighter audit requirements and controls are put into place. BIA and Risk Assessment practitioner can become quite confused with the different regulatory requirements for each.
With that in mind, there are many Business Continuity Software templates that can aid in the process.