Contingency Planning

Developing a Good 'Plan B'

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Fires, floods, tornadoes – these are the things we often connect with contingency planning. But what if your main supplier suddenly goes bankrupt? Or, what if your entire sales force gets sick with food poisoning at your annual sales conference? Or, your payroll clerk simply calls in sick on payroll day? These things can all cause confusion and disorder if you haven't prepared for them properly. Contingency planning is a key part of this preparation.

As you see, contingency planning is not just about major disasters. On a smaller scale, it's about preparing for events such as the loss of data, people, customers, and suppliers, and other disruptive unknowns. That's why it's important to make contingency planning a normal part of your everyday business operations.

Risk Assessment

The need for contingency planning emerges from a thorough analysis of the risks that your organization faces. It's also useful in thinking about new and ongoing projects: what happens when 'Plan A' doesn't go as expected? Sometimes Plan A simply means 'business as usual.' Other times, with more sophisticated risk management plans, Plan A is your first response to deal with an identified risk – and when Plan A doesn't work, you use your contingency plan.

Use these principles in your risk assessment process:

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