Business Continuity Management of the British Red Cross - Case Study Example

Business Continuity Management – The British Red Cross The British Red Cross and the Red Crescent Movement provide assistance and aid to victims of international conflicts such as war; natural calamities such as earthquakes, floods, famine etc., and provide extensive support to refugees from different parts of the world. The Red Cross operates widely both within the country as well as across countries. Although the Civil Contingencies Act (2004) does not govern the Red Cross they work very closely with Category 1 & 2 responders and hence need to have a Business Continuity Management (BCM) Strategy in place so that they can continue to operate and give assistance to Category 1 responders during a crisis or any disaster. This paper will aim to do a Stakeholder Analysis and a Business Impact Analysis in order to understand the business and the people involved in the business. It will identify the relationship of the five most important stakeholders of the business to the business organization. It will analyze the four important processes that are important for the survival of the organization and structure ten generic questions that can be utilized to extract information regarding the four critical processes thus identifying any potential vulnerability in the processes. After seeing thousands of people suffer and die due to the lack of good care facilities at the end of the Battle of Solferino in 1859, a Swiss businessman named Henry Dunant established the International Red Cross and the Red Crescent Movement in 1863. He suggested the opening of international relief societies, made up of volunteers trained in providing neutral and unbiased aid to people in need during war times. As a response to the suggestion proposed by Henry Dunant, The International Committee of the Red Cross was formed and established in Geneva. The Red Cross’s founding charter was drawn up in 1863. In addition to his above proposal Henry Dunant also recommended that countries should come to an international agreement that would identify the status of the medical services provided and the status of the wounded people on the battlefield. This agreement is said to be the original Geneva Convention of 1864. The Franco Prussian war was followed up with a public meeting held in London, where a resolution was passed. This resolution stated that a National Society must be formed in the country to help the wounded and sick soldiers in war times and that this National Society will be formed based on the rules that were put forth by the Geneva Convention on 1864. Thus the British National Society for Aid to the Sick and Wounded in War was formed to aid the sick and wounded soldiers of both armies in war and also to many other wars that followed (Just Giving, Online). The agenda of the Red Cross to provide aid in times of war called for the need for a large number of volunteers. This larger number was the primary prerequisite to help the wounded. For this reason in 1907, an enduring structure of local branches was taken up. This gave rise to the increasing presence of the Red Cross across the different communities in the country. Following this, in 1909 the Voluntary Aid Scheme was established. This scheme ensured that Voluntary Aid Detachments (VADs) were formed in every county in England. The members on the Voluntary Aid Scheme were required to provide assistance to the territorial medical forces at the time of war. The British Red Cross along with other bodies has since provided relief to millions of displaced people and aided populations who were in dire need of the supply of basic amenities (British Red Cross, Online). Stakeholder Analysis A Stakeholder is any person, group or organization who is affected by the actions or steps taken by the organization. A stakeholder analysis looks at who the key players are, what they contribute, what they require, how much power they each exercise and what influence patterns they have on the organization. Thus the stakeholder analysis is an advanced assessment of the interests of those people who are affected by the plans or proposals put forth by the organization and how these people respond to the plans or proposals. It can be used as a technique for negotiation (Kaiser, E, J and Godschalk, D, R and Chapin, F, S, 1995). The stakeholder analysis is also used to identify the key people or organizations, whose interest in the organization has to be sustained or those whose interest have to be won over in order to assist the business. The stakeholder analysis involves three major stages. The first stage identifies who the stakeholders of the business are, that is, who has vested interest in the organization. The second stage prioritizes the most important stakeholders by assessing each stakeholder’s interest, power and influence on the organization. The third stage aims to understand the key stakeholders with a view to either retain or win their interest so as to increase the benefits to the organization (Mind Tools, Online). Identifying the Stakeholders The British Red Cross has five major stakeholders. They include the Donors, Volunteers, Shop Helpers, Corporate Support and Celebrity Support. Donors are people from the general public who make regular contributions to the Red Cross out of personal choice and interest. The contributions from donors are either regular or one time depending upon the cause towards which they choose to donate. The donations can be made to different preset appeals put down by the Red Cross. Donations coming from the general public assume different forms such as donation in memory of someone or in celebration of something, payroll giving, Red Cross on eBay, gift cards etc. Volunteers of the Red Cross are those people who give their time selflessly to people in need. Volunteers join the Red Cross either on a permanent basis or in times of crisis alone. Volunteer can offer a wide range of services including emergency response and first aid volunteering, transport service volunteering, therapeutic volunteering, migration services or health and social care depending upon their interest and qualification. Volunteers choosing to offer emergency response and first aid are required to go through a special training program to qualify them for the job. Shop Helpers are those people who run the Red Cross’s charity shops all over the country. These shops market a wide array of articles such as toys, books, designer clothing, gifts etc. The money collected from these shops is used for the various charity activities of the Red Cross. The companies providing Corporate Support to the Red Cross include Land Rover, Tesco, The City of London Corporation, Cannon Europe, GlaxoSmithKline, John Lewis Partnership, Brit Insurance, BT, Barclays and AstraZeneca. These corporates assist the Red Cross by providing them with financial aid for their various charity activities and by partnering with them to spread awareness about various diseases like TB, HIV and physical disabilities etc. These companies offering corporate support also aid the Red Cross during emergency situations or crisis situations like earthquakes, floods etc., by supplying emergency response vehicles and telecommunication equipment to aid quick transfer of information during emergency situations. They also work alongside youngsters in support of the work done by Red Cross. The Red Cross also has support from celebrities. Celebrities such as Ricky Tomlinson, Konnie Hug, Judy Dench, John Simpson CBE, Angela Rippon, Annie Lenox etc support the Red Cross through shows, fundraisers etc. Prioritizing the Stakeholders This is a very vital stage in the stakeholder analysis as it helps assess which stakeholders exercise the greatest amount of power and influence over the actions of the organization. Following is a power grid, which will help identify the levels of power and interest each stakeholder has and the action that must betaken to win them over or retain them. Each of the stakeholders occupies a position in the grid. The Donors are high power, low interest stakeholders. They contribute financially to the Red Cross and hence hold some amount of power, but since they do not actively participate in any of the activities, they are low interest people. They must be kept satisfied to ensure their continuous support. The volunteers and the shop helpers are low power, high interest people. Though they provide manpower during crisis situations, they do not provide monetary support to the Red Cross. Hence though they have high levels of interest and commitment, they have less power. These stakeholders must be kept informed at all times to get their constant help in times of need. Corporate Support comes under the high power, high interest category. They are a constant source of funding to the organization, apart from actively participating in creation of awareness and provision of aid during disaster situations. Hence they must be monitored closely and given all information available. Greatest amount of effort must be put in to keep these stakeholders satisfied. The Celebrity supporters are people with medium interest and reasonably high power. They must be kept satisfied to retain their support. Hence the Corporate Supporters and the Donors are the major stakeholders for the British Red Cross. Understanding Key Stakeholders The key stakeholders of the Red Cross are the Corporate Supporters and the Donors. The Corporate Support occupies a higher position because of their active participation in the activities of the Red Cross. There are a few points that must be considered when attempting an understanding of the most important stakeholders. The financial and emotion interests of the stakeholder must first be taken into account. Financially it helps companies to boost their business by making their brand prominent in the market and gain goodwill, thus increasing sales and profit. It helps them to engage and motivate their staff thus encouraging them to perform better. Furthermore it helps companies fulfill their corporate social responsibility. As far as Donors are concerned it helps them fulfill their interests and gives them personal satisfaction. These reasons are encouraging many other corporates to draw a partnership with the Red Cross. It is very important to understand the stakeholders’ information requirements from the organization. The main information that they will require is a detailed account of how the funds supplied have been utilized. For this purpose printed information in the form of balance sheets etc., can be sent to them periodically. In addition meetings can be conducted to ensure transparency and to give a detailed analysis of the activities carried out so far. This will ensure their continuous support. In order to win over stakeholders it is vital to prove to them the benefits of entering into a partnership with the Red Cross. Business Impact Analysis Business Impact Analysis is the identification and assessment of the effect of risks on an organization, if and when they occur (Hiles, A, 2002). The Business Impact Analysis assists in the identification of the most vital business processes, whose continual functioning during a major crisis situation is of extreme importance to the survival of the organization. It further helps to assess the recover capacity of an organization after a crisis situation. According to Peltier, T R (2005), the primary objective of the Business Impact Analysis is to determine the effect that critical information systems failure have on the feasibility and operations of the core business processes of an enterprise. Business Impact Analysis involves four critical steps, which will help in identifying the critical processes that need to continue during a crisis and help assess the recovery capacity of the business. Step one gathers he information required while step two performs a vulnerability assessment. The third and fourth steps analyze the information and document the results presenting necessary recommendations respectively (FFIEC IT Handbook InfoBase, Online). The BIA will also help strengthen the critical departments and processes to ensure their continued functioning in the event of a crisis. Gathering Information Information is gathered and collated on which departments and processes must continue to function despite a crisis to ensure the survival of the organization, in this stage of the BIA. The Red Cross has four critical departments or processes that must function during a disruptive event. These processes include Volunteer services, Emergency Response and First Aid department, Corporate and Donor Funding and lastly Refugee and Health Care services. Volunteer support is the backbone of the organization. They assist the existing members of the organization and add to the manpower, which is most essential during a crisis situation. A continuous supply of volunteers is always essential for the proper functioning of the organization. Providing aid to Category 1 and 2 responders is the main objective of the Red Cross. Hence emergency response in the form of transport and telecommunication must function during a crisis. Additionally, first aid medical services must always function to provide immediate help to people. Lack of funding can lead to the ceasing of many activities of the Red Cross. Hence regular and constant funding and financial support from the corporate supporters and donors is very critical for the functioning of the organization. Finally refugee and health care services are of enormous importance to the functioning of the organization as providing health care and refugee services are also the objectives of the Red Cross. Regular, standardized supply of health care services to people in need and a safe, recovery space for refugees must be made available continuously. Without the continual functioning of the above stated four processes, survival of the organization will prove to be very difficult. Vulnerability Assessment Vulnerability assessment is done to identify the effect of a disruptive event on the critical processes of the organization. It is done to ascertain the weaknesses of these processes, in order to strengthen them in preparation of a crisis situation. A loss impact analysis must be carried out wherein the loss maybe quantitative or qualitative. The four critical processes of the Red Cross has been identified as Volunteer services, Emergency Response and First Aid department, Corporate and Donor Funding and Refugee and Health Care services. Identifying the vulnerability and the recovery capacity of these processes is very vital. The primary threat or vulnerability comes from corporate and donor support. Slowing down or loss of fund inflow from the corporate supporters and donors can affect the continuity of the organization. A disruptive event may cause the in flow of funds to either slow down or cease altogether. This can hamper all the activities of the Red Cross, as they are primarily dependent on the corporate and donor funding. Emergency response and first aid as well as health and refugee care services will consequently suffer due to the lack of sufficient funding. All of the above will not conform to the goals and objectives of the organization and hence the organization will suffer a set back. The organization can prevent this loss using both internal and external sources. Internally the organization can ensure proper allocation of funds for various causes and always allocate amount for disaster situations. Externally close association with the government can bring about the inflow of funds even during a disruptive event as opposed to being singularly dependent on the corporate and donor funding. Government support can prevent the processes from being hindered during a crisis. Analyzing the Information The results of the vulnerability assessment are analyzed in this step of the BIA and the overall threat to the continuity of the business is examined. Maximum Allowable Downtime (MAD) is provided for each of the four processes in this stage of the BIA. Ascertaining the Maximum Allowable Downtime gives an indication of the maximum amount of time each process can endure and survive at the time of a crisis situation. Emergency response and first aid and health and refugee care are the most important processes of the organization as they fulfils the primary objective of the organization by providing help to Category 1 and 2 responders during a crisis. This issue is Critical and has the highest priority and hence must be taken care of within the first few hours. Corporate and Donor funding rank second in importance. Since Red Cross is heavily dependent on funding from these sources for more than half of its activities, this issue is urgent and must be addressed within 24 hours. Alternate funding sources must be arranged to ensure the continuous provision of aid in times of need. Volunteer support is of significant importance during a crisis situation. Additional help and manpower during a disruptive situation is of essence to the Red Cross. This issue must be handled within 72 hours and alternative support and manpower must be arranged in order to cope with the crisis situation. Documenting Results and Presenting Recommendation As the final step of the Business Impact Analysis process, this step documents the results obtained so far from the analysis and agrees on the course of action that needs to be followed during a disruptive situation. Following the identification of critical processes, analyzing the loss impact and giving a maximum allowable downtime for each, this step helps identify alternate courses of actions to combat the vulnerability of the processes. The Red Cross is singularly dependent on corporate and donor funding for its activities. It must find alternate sources of funding, for example through the government. This will ensure the continuity of the business even during a crisis. The Red Cross can widen the scope of charity shops to ensure that it brings in significant funding. Available funding can be allocated accurately during normal situations to cope with the needs arising during a crisis. The emergency and first aid department and the health and refugee care department can be strengthened so that those departments can cope with crisis. After analyzing the stakeholders of the business and establishing the importance of the constant functioning of critical processes for business continuity, this paper will further address three vital questions. Identification and analysis of the relationship between the five key stakeholders of the organization and the organization is the first point to be addressed. The five important stakeholders have been identified in the stakeholder’s analysis as Donors, Volunteers, Shop Helpers, Corporate Support and Celebrity Support. Donors make regular contributions towards the Red Cross hence provide a significant amount of financial support to the organization. They in turn gain from these donations, as they are able to avail tax reductions. Payroll donations also benefit individual donors through tax deductions. Volunteers form the backbone of the organization by providing manpower and support. These volunteers apart from mental satisfaction get a considerable amount of training and experience through the service that they provide. Shop volunteers, who help run the charity shops of the Red Cross all over the country, become eligible to get a National Vocational Qualification (NVQ) in retail from the Red Cross when they volunteer to run the shops. Corporate Donors are the financial partners of the British Red Cross. They provide extensive financial support and champion many causes by spread awareness about various issues in addition to funding. They participate heavily during calamities and other disasters by supplying relief vehicles, communication devices etc. This kind of partnering with the Red Cross also helps these corporate companies to a large extent. It helps them fulfill their corporate social responsibility, increases their brand value in the market and provides motivational activities to their employees. Celebrities also offer significant support to the Red Cross. They either donate their time or funds to the Red Cross. While they get a certain amount of mental satisfaction by helping people, they also get a fair amount of publicity either for their movies or music and get a career boost. The following is a Stakeholder Influence Map that pinpoints the position of each stakeholder and details how much power and influence each one has over the actions taken by the organization. This will help decide how to retain and win over the continual support of the stakeholders. Corporate Donors are high interest and high power stakeholders, while donors have low interest and higher power. Celebrity supporters have medium interest and high power while the volunteers and shop volunteers and personnel have low powers and high interest levels. The second important point to be addressed is the identification of four main processes that are important to the survival of the organization and business continuity. These processes have already been identified in the Business Impact Analysis as Volunteer services, Emergency Response and First Aid department, Corporate and Donor Funding and Refugee and Health Care services. Volunteers provide enormous support to the organization during emergency situations. They provide additional manpower, which is a primary requirement during a crisis. There needs to be a constant supply of volunteers to assist in times of need. Providing Emergency Response and First Aid services are the main objectives of the Red Cross. Hence this process needs to be a continuous function as it provides immediate assistance and aid to Category 1 and 2 responders. Health and refugee care services go along with emergency response and first aid. Health care should be made readily available for people during a disaster situation. Refugee care must be available during war times to provide relief to refuges. Corporate and Donor funding are the main sources of finance for the Red Cross. There needs to be a continuous inflow of funding for the organization to cope with the demand arising during a crisis. Efforts must be taken to retain and win the support of corporate partners and Donors. The final part of this paper aims to generate ten generic questions that try to extract information regarding the four critical processes that have been listed, determining their vulnerabilities and supplying a rationale for each question. The following are the questions flowed by their rationale. 1. Have steps been taken to retain the continuous support of the corporate companies who are partnering with the Red Cross and providing regular funding? (Rationale: Identifies the unpredictability involved in donations) 2. Will having more than one corporate body support for the same activity help the Red Cross in the long run? (Rationale: Aims to question the dependency on one partner for one cause) 3. How much money and how many volunteers are required for small, medium and big emergencies? 4. Is there a proportional increase or decrease in the money and volunteer requirements according to the size of the crisis? (Rationale: These two questions try to ascertain the combination of funding and manpower required to handle different situations) 5. What is the minimum response time during natural calamities and disasters? 6. What is the minimum response time during war? (Rationale: These questions aim to analyze the time, location and communication channels) 7. Are there any dangers in setting up refugee camps in war zones? (Rationale: Addresses the dangers of war areas where there is a lack of peace zones) 8. Does remote assistance and other kinds of technology cut down on cost and people involved? (Rationale: Ascertains whether advancing technology and communication channels can be used effectively) 9. Is there continuous upgradation of medical equipments and other facilities to current technological advances? 10. Is there any significance of the impact of upgradation on health and refugee care services? (Rationale: Aims to address the impact of technological advances on health and refugee care services). References British Red Cross. British Red Cross website. Viewed on 24 March 2009. http://www.redcross.org.uk/index.asp?id=39992 FFIEC IT Handbook InfoBase. Business Continuity Planning: Business Impact Analysis Process. Viewed on 24 March 2009. http://www.ffiec.gov/ffiecinfobase/booklets/bcp/bcp_14.html Hiles, A (2002). Enterprise Risk Assessment and Business Impact Analysis: Best Practices. Rothstein Associates Inc, 2002. P 152 Just Giving. British Red Cross – History. Viewed on 24 March 2009. http://www.justgiving.com/charity/history.asp?FRSId=13108 Kaiser, E J and Godschalk, D R and Chapin, F S (1995). Urban Land Use Planning. University of Illinois Press, 1995. P 466 Mind Tools. Stakeholder Analysis. Viewed on 24 March 2009. http://www.mindtools.com/pages/article/newPPM_07.htm Oracle Customer Case Study. British Red Cross Keeps Employees and Volunteers Connected with Leading-Edge Intranet. Viewed on 24 March 2009. http://72.14.235.132/search?q=cache:Uqc2cCQntloJ:www.oracle.com/customers/snapshots/british-red-cross-oucm-case-study.pdf+%22British+Red+Cross%22+and+corporate+partners&cd=7&hl=en&ct=clnk&gl=in&client=firefox-a Peltier, T R (2005). Information Security Risk Analysis. CRC Press, 2005. P 289 Read More