Business Impact Analysis: Importance And Techniques Essay.

Techniques of Business Impact Analysis

Question:

Discuss about the Risk Management of the AE Kalina Cycle.

Business Impact Analysis is the systematic approach for determining and evaluating the possible effects for breaking the critical business operations as a result of a disaster, calamity or emergency. It is an essential component of the organisations business continuous plan. It generally includes a descriptive component to expose the susceptibilities and for this planning component is essential developing the strategies so as to overcomer from the risks or the disasters (Scholten et al., 2014). Business continuity process analyses the critical function which mainly identifies and computes to the greater impact of the loss of the functions. It basically identifies the effects on the financial, life, regulatory, legal etc. of the natural and the man-made events on business operations.

The risk assessment is an easy way of identifying the potential hazards such as any disaster calamity like earthquake, supplier failure, fire or cyber-attack, which generally tends to evaluate the areas which are more prone and our vulnerable for occurring of the hazards. Risk assessment generally includes the people, property, supply chain, information technology, business reputation etc. A mitigation strategy has been developed for reducing the maximum probability of occurrence of any hazardous activity which have the significant impact on it (Pritchard and PMP, 2014). In the risk assessment stage the BIA is been examined against the hazardous scenarios which have the adverse effects on impacting on the business operations. It is generally used for making the justification in the cost from prevention and mitigation of the risks for implementing and designing the strategies

It is the heart of all good calamities or the disaster recovery planning projects. It is essential for collecting the data and information from the organisations. Those organisations that can actually access to the functions and can perform to all the business operations can access to the critically business functions. The big data collection can actually collected from the interviews, workshops, questionnaires etc. It is important to have a clear picture of all the documents and the main mission on the critical analysis on the collection of the information.

Step one of the BIA Process- Identification of the key systems, functions, processes, etc. which are critical for the success of the organisation. As these processes are the significant areas where any failure would cost the company to suffer heavy losses. Information security in these areas is indispensable so to maintain the smooth functioning of business. Following are some of the areas where data is required to be safeguarded using proper risk management techniques.

Identify Outage Impacts and Estimated:

1. System Failures

• Failure occurs in the System Failures: There are risks that the intruders enter into the system and divert the files regarding to the information of the company and to the original transaction failure.
• Impact- it will result in the failures
• Responsible Department-Whole Organisational Structure
• Impact Category: Major
• Impact Values: 50000-500000

1. Natural Disasters
2. Failure due to Natural Disasters: The failure is occurred in the organisation due to any natural disaster calamity occurred in the organisation and it mainly affect to the whole organisational behaviour and stop the all the business operations for the performance.
3. Impact- loss of useful inventory, turnover loss, loss in the whole organisation.
4. Responsible Department: Natural calamity.
5. Impact Category: catastrophic
6. Impact Values: 100000-1000000

• Human Caused Catastrophes

1. Failure due to Human Caused Catastrophes – The risks is raised due to the man-made frauds and crimes, loss of valuable information assets of business.
2. Impact- loss of funds affecting the overall profitability of business, financial loss due, legal repercussions, loss of competitive edge, sabotage.
3. Responsible Department: Individual or personnel’s.
4. Impact Category: major
5. Impact Values: 100000-1000000
6. Legal Costs Risks: Failure in Legal Costs Risks: The important data is misused by the members of the organisation, imprisonment, penalties and fines
7. Impact: Loss of sensitive information, bankrupt services, expenditure on the audit of legal fee.
8. Responsible Department: Finance and Accounts department.
9. Impact Category: major
10. Impact Values: 50000-700000 

They are the adverse effects because of the failures in the respective field. 

Maximum Tolerable Downtime (MTD)-It is used for identifying the time duration taken for detecting the risks in  all the business process in which it can be engaged before the significant damage or to the long term feasibility is threatened. They are been published in to the same database or the spread sheets which specify all the business processes (Li et al., 2017).

Recovery Time Objective (RTO) - It is the period of time from the risk been detected to the recommencement of all the business process.

Recovery Point Objective (RPO) - It is the maximum period of the data been loss when the disaster counting backwards.

Identify Recovery Priorities for System Resources

1. Injuries and losses to the lives of employees as a result of flooding at AEKC locations- It provides the speaking approach which mainly combines and provides the tools for lash flooding and forecasting to reduce and to overcome from the potential disaster. It mainly affected to the main causes of the business investments, stock in the business, resources and equipment’s used, plant etc. as well as the treats caused to the safety of the employees and to the customers. Etc. It made the business closed for the certain period of time.
2. Increased security threat and exposure as a result of using an out-dated ERP system- The application security mainly aim to control the design work and to the systems. The usability of the out-dated ERP system leads to the crashes and to integration issues. Because the older software versions and are not compatible with the new products and the services and for this even the browsers and the servers are adversely affected from this (Verner et al., 2014). It also results in the insufficient reporting capability which mainly leads to the loss of the data. Using of the old ERP can lack to the system functionalities.
3. Unauthorized access to customer data as a result of migrating to a cloud HR solution: The organisation is lacking behind storing the data in the cloud HR technology as they using the same technology for storing the important data and information of the customers in the same software. The new technology provides the platform for making the information secured, authorized and authenticated of the users. The AEKC lacks in creating the outstanding business views and the functionalities of the latest technologies without investing in any complex IT solutions. It also heading up to the data loss prevention which tends to leaked the data to the public domain.
4. Leakage of transaction information to third parties as a result of employees working on personal computers: In today’s scenario it is very common dealing with the leakage of the data and the information of the organisation. The insiders have become a major part of the biggest security threat of the company. The retort to the damages of data formerly has deliberated to security has mutated from shock to shrug. Assaults and threats on the corporate databases have become the new way of disclosing and making the data publically (Chen et al., 2013). And a peer group of workers familiarized to sharing of information which has grown numb to its undesirable consequences. Most of the threats are being generated form the victimized organisations which mainly allows the cyber attackers to burrow in and to grant permission for infecting the databases. Some of the third party contractors take the privilege for breaching the client’s networks through malice or by accident.
5. Loss of revenue due to non-compliance with Australian standards: It is essential to measure the entity of the resources so as to avoid the loss of an organisation. It is critical objective for measuring the revenue and the amount of the assets and of selling expenses (Chen et al., 2013).

1. ERP system becoming a liability on organisation- The ERP should be installed before, was a wise decision made for the making the streamline process and improving the efficiency on the organisation process. In today’s scenario, ERP is majorly consuming the majority of the time in the system up gradations, rising cost of the maintenance cost and the innovation time left for innovating the business process.
2. Lagging Process: It is the proc3ess of efficiency which mainly have the significance on the rising past. But since the time has been past there is no such improvement in the process or to the efficiency (Berger, 2015). All the efforts should be made on the future complexities. The main target is to achieve the efficiency in the increasing output.
3. No database support- In today’s scenario it is essential to maintain the organisational database in the cloud. But there is no flexibility of moving the data in the cloud storage. It is the smart choice for the current scenario in an organisation for generating the automatic updates, maintenance, scalability, accessibility to the real time data etc.
4. Lacking in Workforce- It is based on the employees who are currently working with an organisation so as to achieve all the tasks. They initially tends to turn the organisation in the exciting form of the comparison made on time-consuming methods. Higher the scope of the organisation, higher the main goal of an organisation.
5. Lack of real-time business information- It is necessary to maintain the real time connectivity of the business to fasten the process. More ERP enabled companies more the organisation would reach for achieving the task. It is necessary to look for the real time collaboration (Berger, 2015).

Conclusion

It is essential in today’s scenario from preventing for the risks and the threats which has occurred in an organisation so as to mitigate the risks. The main effectiveness of accessing the risks totally depends upon the improvement in the organisation and the proper strategies being implemented on time. It is essential to have the security postures on the events which have been placed in an organisation whether it is good or bad so that the prevention should be made and to have the continuous business process and continuity in the business operations in near future.

References 

Berger, R., 2015. The challenges of introducing ERP in SMEs| IT Industry| Industrial know-how| Expertise| Roland Berger.

Chen, J., Sohal, A.S. and Prajogo, D.I., 2013. Supply chain operational risk mitigation: a collaborative approach. International Journal of Production Research, 51(7), pp.2186-2199.

Li, H.J., Chang, S.I. and Yen, D.C., 2017. Investigating CSFs for the life cycle of ERP system from the perspective of IT governance. Computer Standards & Interfaces, 50, pp.269-279.

Pritchard, C.L. and PMP, P.R., 2014. Risk management: concepts and guidance. CRC Press.

Scholten, K., Sharkey Scott, P. and Fynes, B., 2014. Mitigation processes–antecedents for building supply chain resilience. Supply Chain Management: An International Journal, 19(2), pp.211-228.

Verner, J.M., Brereton, O.P., Kitchenham, B.A., Turner, M. and Niazi, M., 2014. Risks and risk mitigation in global software development: A tertiary study. Information and Software Technology, 56(1), pp.54-78.