In Europe and North America, one factor in favour of implementing a CMP program is that insurance companies now provide rebates for organisations that maintain effective premium CM programs.
They eventually may mandate the testing of CM procedures before they issue loss of business insurance due to a business or computer outage.
Insert the insurance savings or potential savings into your budget estimate. Suppose corporate insurance is not applicable in your country when determining a CM plan's budget.
In that case, you should consider the allocation of funds for training and the resources needed to write and test the CM plan. Heighten Executive Management's awareness of the critical business function or IT application systems already in place and assess the backup capabilities required to recover within the allotted time.
To accurately define your CMP requirement as part of the budgeting process, you will need to:
The budget amount is first estimated during the Project Management phase. It should include the initial project operating costs, such as attendance at training, engagement of consultants, or purchase of specialized CMP software. The budget is then fine-tuned in the Crisis Management Strategy phase, when details of resource requirements are usually generated.
The points to look out for in budgeting are much the same as those for estimating the timeframe. Any increase in the time taken for the CMP project inevitably results in spending more money. Be careful not to fall into the trap of increasing the number of people working on the CMP project to bring it back on schedule.
Putting more people on the job brings with it higher overheads, for example, space, computers, and other equipment, and less productivity per head, at least initially, as the newcomers must be trained and must acquaint themselves with the CMP project.
Your budget should reflect all the resources required from the start of the CMP project to the end. The budget includes the following:
The budget from the business units includes:
Projects are often stopped due to budgetary constraints. No matter how convincing the business case is, the required expenditure may not be approved if funds for the CMP project are not allocated to the relevant business units' budget.
Therefore, it is paramount that the Organisation CM Coordinator lobby the senior management and the various business units during the annual budgeting process to include appropriate funding for CMP in the upcoming budget.
If the budget was inaccurately developed, you may not get adequate funding or resources to achieve your objectives. Be aware of the corporate budgetary cycle for approval and disbursement of funds. In some organisations, the budget may be carried forward to the next financial year, but in others, it would be removed if it is not spent in that financial year.
CM Project Management StepsClick to find out more about the detailed requirements for each step |
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Goh, M. H. (2016). A Manager’s Guide to Implement Your Crisis Management Plan. Business Continuity Management Specialist Series (1st ed., p. 192). Singapore: GMH Pte Ltd.
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