Business continuity enjoys the limelight
The attacks on London in July have raised the profile of Business Continuity Management
The attacks on London in July have raised the profile of Business Continuity Management, a market which offers lucrative margins for resellers but may not capture the attention of UK companies for long, writes Trevor Treharne.
Lose data and you will go out of business. That is the message research houses and government bodies are hammering home to companies of every size and in every sector.
At this time of heightened security, if firms want to safeguard their data as well as their reputation, a plan is needed. Luckily, technology has the answer: Business Continuity Management (BCM), a system ensuring that critical business processes remain in operation even after an unforeseen incident. And while security concerns remain high, the demand for BCM will continue to grow.
Analyst IDC expects UK sales of BCM services to rise from £491m in 2005 to £589m in 2009 (see graph below). Research firm Gartner found that a quarter of firms have no BCM programme and fewer than 10 per cent have a fully managed one.
BCM is not to be taken lightly according to ‘London Prepared’, the web site prepping the capital and businesses for potential disasters. The site has claimed that 80 per cent of businesses affected by a major incident close within 18 months and 90 per cent that lose data close within two years. It has also said that 58 per cent of UK firms were disrupted by 9/11 and one in eight were seriously affected.
The London Chamber of Commerce (LCC) has also moved to ensure that business continuity is not simply seen as a luxury, but a necessity. The LCC has had a recent push on attempting to get SMEs in particular to implement BCM plans. In a recent study the LCC found that 44 per cent of SMEs have no contingency plans at all. Michael Cassidy, LCC president, said: “The chronic lack of preparedness on the part of small and medium-sized firms is the greatest avoidable threat in the capital today.”
David Honour, an expert at Continuity Central, a web site which specialises in BCM information, said even the smallest of firms can prepare.
“The larger the business, the higher the costs, but for small businesses it doesn’t have to be expensive,” he said. “The most important aspects are data recovery and storage. Demand for business continuity goes in fits and starts, and each time something happens people get attracted for three or four months, then lose interest.”
Jamie Snowden, research director at IDC, agreed that the importance of business continuity is not to be underestimated, but added that key events such as the recent attacks on London heighten interest only temporarily.
“Business continuity has always been important and recent events will arouse more interest. BCM vendors said that post-9/11 their phones rang off the hook, but some time after the attack, although a lot of people spoke about business continuity, not many took it up once they had looked into it,” he said.
This is exactly where the channel becomes relevant, according to Honour. He said resellers are well placed to include business continuity in their sell and offer it as an additional service. “It is certainly something resellers can do in their market. The box shifters can drop off recovery machines,” he said.
Nigel Lambert, channel director at storage distributor Zycho, said business continuity is a huge opportunity for the channel. “Business continuity is a fundamental part of any company. Data is the lifeblood of business and without it firms cannot function,” he said.
“We have been successful in providing business continuity to the channel. This is a significant channel opportunity and will enable resellers to add real value.”
Lambert added that business continuity is not purely a London concern. Its importance is countrywide because all verticals that deal with the US and European companies or in data-sensitive areas can be affected.
Gordon Davis, commercial director at reseller Compusys, which offers a busin ess continuity and disaster recovery programme, highlighted the importance of business continuity and the benefits for resellers.
“It is worth investing in. It offers highly lucrative margins, and the smarter reseller will want to understand this space. Many firms, particularly in the City, have some kind of a plan in place. In the City the uptake is pretty good, but outside it is pretty patchy,” he said.
After the events in London in July, BCM provider SunGard Availability Services said it received 84 alerts from businesses and 28 customers had to use the service after failing to gain assess to their premises.
Keith Tilley, UK managing director and senior vice-president for Europe at SunGard, said: “The July event will heighten the business continuity discussion. It makes companies look at their plans, but it does not necessarily increase business for us.”
Research conducted by business continuity body Link Associates found that 38 per cent of London firms invoked their business continuity plans on 7 July, and a further three per cent had to use disaster recovery sites.
Mike Thornhill, crisis and emergency consultant at Link Associates, said: “Businesses are going to be reviewing their plans. The implication if you don’t account for these events is failed communications, such as not knowing where your staff are and what are they doing.”
Tilley said that the recent terrorist attacks will lead a greater number of enquires for SunGard’s services from firms keen to run tests, and that the channel has an important part to play.
“We have partnerships with resellers that offer our services on the back of their offerings. We expect our channel relationships to improve over the coming months and are looking to expand our network of resellers working in particular markets and countries,” he said.
However, Mike Osborne, operations director at BCM provider ICM Computer Group, said: “The terrorist attacks are not driving business continuity. BCM has been around for a decade, and if you are a major London firm you already have a system in place. The attacks have merely raised the profile.
“A firm can have a whole facility go up in smoke, it is covered in the media and before long customers will be on the phone asking what is happening with their order. They may move on to another supplier.
“The fear and disruption affects trade, and if you have a major data loss you could go out of business.”
According to the Certified Information Systems Security Professionals, about 65 per cent of companies could not stay in business if they had to close down for a week or longer. It is estimated that fewer than five per cent are so well prepared that they could suffer a disaster and survive.
Davis added that some firms view business continuity as a critical focus but not all potential customers understand its importance.
Gathering business continuity capabilities could be seen as a smart move for resellers, particularity those with a dense storage or security portfolio. BCM vendors seem keen to talk channel, but with the high cost of BCM and the fickle mindset of some firms, particularity the non-London “it will never happen to me” brigade, it could be an ill-advised investment.
The market consensus seems to understand the need for business continuity and recent events would have drawn the attention of the most ignorant of businesses to the issues, but it may be that the calls made in July are forgotten by Christmas.