Retail Executive

JAN-FEB 2018

Retail Executive is the trusted advisor to top retail executives from the industry’s most profitable retailers. We help retail executives succeed in their job role and grow their business via exclusive, actionable, peer-driven content.

Issue link: http://digital.retailexecutive.com/i/918144

Contents of this Issue

Navigation

Page 34 of 43

BUILDING: Determine how long your organization can afford to be nonfunctional. Depending on your business, this may be zero tolerance for nonfunctionality to considerable tolerance for nonfunctionality because you have both space and capacity to move operations to other physical locations. Keep in mind that natural disasters wreaked havoc in the southern part of the United States in 2017. There were seven tropical storms and 10 hurricanes, causing over $316 billion in damage. You may not have a physical building in these impacted markets, but do you have third-party vendors operating in these high- risk areas? THIRD-PARTY VENDORS AND PARTNERS: Rely on partners for physical and technological help. They can support your success through transpor- tation or warehousing, staffing during peak load, or last-mile delivery services. They can also connect processes, whether it is the handoff of electronic data interchange (EDI) documents, load forecasting, or de- tails of customer orders. Building a BIA and BCP can be overwhelming for companies large and small. There are many resources available, including Ready.Gov, a government resource. You could also hire a consultant to create a plan, com- plete the BIA, and create the BCP with the partnership of leaders within an organization. Cyberattacks are not only a concern for large compa- nies; they should be a concern for every leader in every organization. Leaders need to ask the question, "Who is our least-prepared partner when it comes to business continuity?" Then, leaders need to ensure their teams work with partners to take advantage of the efficiencies technology has created across all touchpoints in the supply chain process — the exact process cyber crimi- nals are working so hard to disrupt. R The best strategy is to prepare a business continuity plan (BCP), which identifies financial and physical risks that arise from a crisis. If the plan is comprehensive, it will have the necessary implementation steps for oper- ating critical functions during a disruption in business. Before creating the business continuity plan, however, the business impact analysis (BIA) needs to be com- pleted. It is important to note the BCP and BIA are two distinct documents. Establishing this understanding when speaking about crisis management and business continuity will provide a clear road map for the share- holders, business owners, customers, and the leader- ship team. During an incident is not the time to share that you have a fire response plan but have not complet- ed a full business impact analysis. THE BUSINESS IMPACT ANALYSIS The BIA is designed to highlight critical functions and processes. It should not be a plan for an infinite num- ber of specific possible disruptions (e.g. a gopher could chew through our electrical cabling, and we'll lose power), but instead be a plan for the general types of disruptions (e.g. loss of power regardless of the cause). Some areas of the company will, and should, have more detailed plans. For example, the public relations team will have a communications plan for specific scenarios. When completing a standard BIA, each area of the company answers questions on the criticality of team, technology, and building. For those in the supply chain industry, it is critical to add third-party vendors and partners in the answering of these questions. Doing so will quickly reveal gaps with vendors and show the im- portance of these partners to your organization. TEAM: Consider the human capital it takes to run your busi- ness. Do not identify individual people, but instead the positions that are critical decision makers and doers that keep the operation going. If there was an event that caused excessive absenteeism, are you prepared to continue operations? Avoid the disruption many manu- facturing companies had in 2009 to 2010 because of the H1N1 virus; 60.8 million adults were ill or needed to stay home with a sick family member. TECHNOLOGY: Evaluate not only internal threats, but also the multiple touchpoints of the supply chain such as delivery, trans- portation, billing, etc. Security breaches are increasing at a double-digit rate year-over-year and are coming from a variety of sources, so it is important to evaluate with breadth and depth. 1 http://www.digitalistmag.com/digital-supply-networks/2017/03/14/cyber- security-in-digital-supply-chain-managing-third-party-risk-through-ver- ified-trust-04958505 2 https://www.cdc.gov/flu/pandemic-resources/basics/past-pandemics.html 3 http://www.ship-technology.com/features/maersk-cyber-attack-reveal-in- dustry-dangerously-unprepared/ 4 www.ready.gov R I C K O L S O N is a retail consultant with over 24 years of experience in corporate and retail store management at one of the nation's largest discount box retailer. He brings to the table recognized experiences throughout the retail journey of in-store operations, merchandising, inventory management, crisis management, supply chain, and over 15 years experiential retail. RETAILEXECUTIVE.COM JANUARY/FEBRUARY 2018 35

Articles in this issue

Links on this page

Archives of this issue

view archives of Retail Executive - JAN-FEB 2018