{"id":3540,"date":"2016-08-30T01:22:39","date_gmt":"2016-08-30T01:22:39","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2016\/08\/30\/building-a-competitive-advantage-through-a-business-continuity-plan\/"},"modified":"2023-05-31T07:37:23","modified_gmt":"2023-05-31T11:37:23","slug":"building-competitive-advantage-business-continuity-plan","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/building-competitive-advantage-business-continuity-plan\/","title":{"rendered":"Building a Competitive Advantage through a Business Continuity Plan"},"content":{"rendered":"

Special thanks to <\/em>Source One Management Services<\/em> for this guest post<\/em><\/p>\n

Building and maintaining a competitive advantage in today\u2019s complex supply chain environment can be a never-ending endeavor.\u00a0\u00a0 As customer needs and economic conditions evolve, what once put your company at the forefront of the industry may become your downfall.\u00a0 Producing a product or providing a service that is superior in quality, the most cost competitive, and comes with best-in-class customer support is certainly the goal, however in reality, choosing two of the three and aligning with customers who are seeking that mix is the standard in many markets today.<\/p>\n

While external factors outside of your immediate control can drive cost and quality depending on the availability of raw materials, taking ownership of internal operations can provide an advantageous perception of your company\u2019s overall competitiveness through the promotion of supply chain resiliency.\u00a0 This can be done by designing, implementing, and most importantly being transparent in sharing a Business Continuity Management (BCM)<\/strong> plan with all current and potential customers.<\/p>\n

Undergoing such an initiative may seem laborious, however the process can drive advantages at every stage, the first of which, is proving there is a need.\u00a0 This is best executed by performing a comprehensive audit of all critical incidents of both large and small scale. \u00a0The costs incurred to alleviate these incidents are hard examples of the impact a lack of a BCM plan is having on your bottom line.\u00a0 While further value will certainly be driven upon execution, the immediate financial incentive to resolve these issues should be enough to keep senior management engaged.\u00a0 The specific details of a recovery and continuity plan will vary depending on the product or service being provided, however there are general stipulations that will make a plan not only critical to the continued success of the company, but also attractive to a current or potential customer.<\/p>\n

A first best practice is to ensure that you are taking an enterprise approach to your continuity plan<\/strong>.\u00a0 This will centralize all stakeholders needed to respond to a particular crisis, and gives each customer piece of mind regardless of geography.\u00a0 It also eliminates duplicate efforts as all instruction comes from a single source of information throughout the response period.\u00a0 Finally, this approach allows for the revision of the plan based on lessons-learned from past responses leading to constant improvement.<\/p>\n

A second best practice is to ensure that your plan covers and reports on all fathomable losses<\/strong>.\u00a0 This includes a loss of facility due to a fire or natural disaster, an interruption in your own supply chain due to external or internal forces, a loss of personnel, a change of government policy, or any other industry specific risk.\u00a0 Expected recovery times and where applicable, historic recovery times, should be clearly communicated for each associated risk.<\/p>\n

Next, address how interruptions will affect a customer specifically, especially for large scale customers.<\/strong>\u00a0 This should include setting aside a clear communication plan between yourself and a designated point of contact at each necessary location to discuss any interruptions.\u00a0 This is also valuable to a potential customer as it will likely feed into their own continuity plan creating a seamless chain of communication and reaction.\u00a0 It may also be advantageous to communicate the prioritization schedule for customers in the event of a disruption.\u00a0 Customers with larger volume and thus larger leverage will be further incentivized to remain with a company, even despite a lack of competitive advantage in other areas, knowing that they are higher up on the priority chain should inventory be unavailable to fulfill all current orders.\u00a0 Record and communicate the frequency of which your plan is reviewed, tested, and updated.\u00a0 This will keep customers engaged in the agility of your operations and serve as a reminder of your commitment to providing uninterrupted products and services.<\/p>\n

It is also useful to communicate and share all updates with your own supply chain and engage in open two way communication<\/strong> on the best way to minimize interruptions and mitigate disaster.\u00a0 It is just as disadvantageous for your supplier if you experience an interruption that will stop production as it may cause a decrease in purchasing or even the loss of your business.\u00a0 Sharing your continuity plan<\/a> up the supply chain will give you leverage to negotiate better pricing or terms as it gives the supplier piece of mind that you will continue to purchase, especially with custom materials.\u00a0 This furthers your competitive advantage by keeping quality consistent while minimizing cost.<\/p>\n

The value of transparency can be overlooked in customer \u2013 vendor relationships as business processes are often held as proprietary and confidential.\u00a0 Certainly there is reason to create a business continuity plan that is held internally and not shared with current or potential customers, however this drastically diminishes the plan\u2019s value.\u00a0 If a company is fortunate enough to never experience a major disruption, its reaction abilities are unknown to the general market.\u00a0 As supply chain resiliency becomes a greater focus, customers want proof that a company is reactive and responsible, and that will drive competitive value.<\/p>\n

Recommended Reading<\/b><\/p>\n