Reputational Risk Management Includes Business Continuity and Contingency Planning

Michael D. Moberly   September 8, 2009

The precursor to contemporary ‘business continuity-contingency planning’ (BCCP) was ‘disaster recovery planning’ that typically focused on (1.) protecting tangible-physical assets, i.e., plants, equipment, inventory, etc., (2.) containing the extent/criticality of the damage/loss, and (3.) building in redundancies (back-up systems) intended to continue all/part of a company’s operation during a disaster.  Today, BCCP needs to broaden its scope to include a company’s intangible assets, e.g., intellectual capital, image, goodwill, brand, reputation, and intellectual property.  Why?, because 65+% of most company’s value, revenue, sustainability, and foundations for future growth now lie in – are directly related to intangible assets.  In other words, a major and permanent shift has occurred from tangible/physical asset-based companies to intangible asset-based companies!

Now, well conceived/designed BCCP must include processes/procedures to (1.) ensure the control, use, ownership, and value of those assets are sustained during and following a disaster, and (2.) mitigate a company’s risk to the irreversible loss and/or de-valuation of those assets that would impair operating capability, revenue streams, competitive advantages, market share, reputation, and intellectual capital, etc.

Quite correctly then, BCCP has become a responsibility/task carrying a much higher profile, largely because it falls directly within the purview of – impacts all c-suite functions.  BCCP’s that do not effectively address a company’s intangible assets will, with increasing frequency, render company officers, management teams, and their companies vulnerable to legal action and reputational risk in which image, credibility, relationships with suppliers, vendors, and investors, etc., can be irreversibly strained and/or impaired which further inhibits recovery.  

Absent an effective BCCP in place, trying to prove assets’ existance, their contributory value, and recover them after the fact, is costly, time consuming, and will inevitably delay recovery.  Why?, because once a significant threat/risk (disaster) materializes, and key assets are out of a company’s control and protection, regardless of IP and/or IT protections/redundancies that may be in place, the probability that a company will fail, or that its recover will become protracted and at a fraction of its original status is elevated.  Consequently, skills and experiences business continuity-contingency planners should now bring to the table are those relevant to identifying, unraveling, assessing, and monitoring a company’s inventory of ‘mission critical’ intangible assets.

As the above objectives (recommendations) are integrated in business continuity and contingency planning they will enable/facilitate a more complete and speedier (economic, competitive advantage, market share, revenue) recovery, which, in today’s globally competitive, predatorial, and winner-take-all business environment is not an optional luxury, rather a fiduciary necessity!


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