Backup & Disaster Recovery IT Security Outsourced IT

Business Impact Analysis

What is Business Impact Analysis?

Business impact analysis (BIA) is a method to predict the consequences of disruptions to a business, its processes, and its systems, by collecting relevant data. This data can be used to develop strategies for the business to recover in the case of an emergency. The BIA framework is used to analyze the consequences of disruptions, considering potential loss scenarios, the timing of disturbances, and the results affecting crucial products and services. A risk assessment also examines the processes or activities supporting those disruptions, which provides organizations with the information that they need to plan recovery strategies and to plan for investments in prevention and mitigation strategies. The benefits of BIA include1:

Recovery process. Business continuity plans (BCPs) should include the procedures or highest-impact assets for all the functions listed in a BIA. These prioritizations will provide transparency on where BCP improvements can be made.

Organizing recovery. In a recovery situation, it’s crucial to have a disaster plan that defines the highest prioritized tasks. A BIA accomplishes this by ranking each priority and providing an “order of recovery” list within the BCP.

Prioritizing BCP testing. A BIA will prioritize the areas that will be tested in the BCP. For instance, critical assets may need to be tested annually, while high-priority assets may need to be tested every 18 months.

Measuring BCP testing effectiveness. A BIA provides sufficient measures to evaluate the BCP testing effectiveness. Testing recovery times can be compared to the maximum tolerable downtime (MTD). If recovery time takes longer than the MTD, the process can be reevaluated and improved.

Informs backup rotation scheduling. BIA aids in understanding whether backups achieve the desired results of recovery point objectives. IT staff can use this information to set backup schedules and rotations.

The BIA process is follows:

  1. Identify the Scope of the Business Impact Analysis. Identify all of the business functions that will be covered, interview individuals for the assessment, and then create a timeline for the BIA.
  2. Schedule Business Impact Analysis Interviews. After identifying the scope, meet with department leaders to establish the value of the BIA.
  3. Execute BIA Interviews. Conduct interviews to determine the activities each department performs. Conduct a risk assessment by assigning the value for the likelihood of loss or the impact for every dependency. Use this data to provide risk ratings.
  4. Document and Approve Each Department BIA Report. Draft the BIA report, distribute it to staff, and meet with participants to review it.
  5. Complete the BIA Summary. After each department completes its reports, finalize the BIA summary for management to review and approve. The purpose of this is to provide an overview of the key activities, requirements, and identified risks.

1 Amos, 2022, “The Basics of a Business Impact Analysis (BIA)”