Singapore SMEs not prepared for disaster

Business continuity preparation needs to move beyond just IT hardware and data centricity.
By Gerald Wee
13 Apr 2009

SINGAPORE, 13 APRIL 2009 – Many small and medium enterprises (SMEs) in Singapore see the need for business continuity and have taken a number of steps towards mitigating business impact should disaster strike. However, company perceptions of what constitutes adequate business continuity preparations are still not holistic enough, and tend to focus on information systems and electronic data.

According to a research group AMI Partners study, of medium-sized businesses in Singapore, 96 per cent of respondents to a survey on business continuity believe that disasters such as fires (44 per cent), utility outages (17 per cent), epidemics (12 per cent), terrorist attacks (8 per cent), and cyber threats (8 per cent) will impact their organisations.

“About 71 per cent of the respondents have a trained business continuity management team, and this does make it seem that companies are well-prepared for business continuity and disaster recovery,” said Daniel Sim, manager, SMB Consulting & Research, AMI Partners. “Confidence that implementation will work ranked 7.1 on a scale of one to 10.”

Gaps in readiness

While the numbers seem to bode well for Singapore, Sim noted that further probing in the survey identified gaps in readiness.

“Most of the respondents were from the IT department, and although they may be familiar with some standards like BS7799 and ITIL which are information technology-based, the broader TR19 standard for business continuity management was never mentioned. This means that the total business impact on the company tends to be under-estimated,” said Sim.

“There is a lot of misinterpretation in business continuity,” said Wong Tew Kiat, BCP leader, NCS. “It is moving away from just IT and systems towards people and business critical departments.”

He cited the example of Deutsche Bank which had a business continuity plan in place, and when the World Trade Center disaster struck in New York City in 2001, only two, out of more than 5,000 employees, died.

SARS epidemic

In Singapore, Wong also noted that the SARs epidemic in 2003 was also about people, not IT systems.

“Part of the equation is having available seats, not just computers,” he said. “Having alternative centres is important.”

“I want to say that IT disaster recovery does not equal business continuity management,” Wong added. “It is very much about people, and what people need to do to continue business.”

The study also found that another main obstacle towards being ready in case of disaster is finances as some 50 per cent of respondents in some industries do not have the resources to implement such a programme which can be substantial, ranging from tens of thousands to hundreds of thousands of dollars, depending on requirements.

Singapore fund

The good news is that the Singapore government has set up a S$30 million (US$19.7 million) fund to help local companies get ready.

“Up to 70 per cent of the consultation and auditing costs needed to implement a business continuity programme can be covered,” said Roland Teo, deputy director, capacity building division, Singapore Business Federation, which is responsible for helping companies access the fund.

Ultimately, how much is spent on business continuity depends on the impact of a disaster on the company.

“After the business impact analysis is done, an organisation will be able to better assess its own needs and make a better decision,” said Wong.


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