[OR] [P2] [S3] [ITo] [C2] Why Mapping is Critical for Operational Resilience

[P2] [S3] Chapter 2

Why Mapping is Critical for Operational Resilience?

Introduction

Operational resilience requires organisations to ensure that Critical Business Services (CBS) can continue to operate within acceptable thresholds, even during severe disruptions.

Achieving this outcome is not possible without a clear understanding of how services are delivered and on what they depend.

This is why mapping interconnections and interdependencies is a cornerstone of any operational resilience framework.

In today’s environment, financial institutions operate within complex ecosystems that involve digital platforms, outsourced services, and interconnected infrastructures.

Disruptions are no longer isolated events—they propagate across systems, functions, and third parties.

Without structured mapping, organisations risk making decisions based on incomplete or inaccurate assumptions.

This chapter explains why mapping is critical by examining regulatory expectations, the importance of risk visibility, and how mapping supports key resilience activities such as impact tolerance setting, scenario testing, and recovery planning.

Purpose of the Chapter

The purpose of this chapter is to:

• Explain regulatory drivers for interconnection mapping
• Highlight how mapping enhances risk visibility and vulnerability identification
• Demonstrate how mapping supports core operational resilience activities
• Establish mapping as a foundational capability, not a compliance exercise

Regulatory Expectations

Regulators globally have shifted from traditional business continuity requirements to a broader operational resilience mandate, placing strong emphasis on understanding interconnections and dependencies.

Monetary Authority of Singapore (MAS)

The Monetary Authority of Singapore requires financial institutions to:

• Identify Critical Business Services (CBS)
• Map dependencies and interconnections supporting these services
• Conduct end-to-end scenario testing
• Ensure services remain within defined impact tolerances

MAS guidance emphasises that resilience must be demonstrated at the service level, supported by a clear understanding of dependencies across people, processes, technology, and third parties.

Bangko Sentral ng Pilipinas (BSP)

The Bangko Sentral ng Pilipinas, through BSP Circular 1203 on Operational Resilience, requires banks to:

• Map critical operations and supporting resources
• Identify interdependencies across systems and third parties
• Assess vulnerabilities that could impact financial stability

The BSP places strong emphasis on systemic risk, highlighting how failures at one institution can propagate through the financial system.

Bank Negara Malaysia (BNM)

The Bank Negara Malaysia requires financial institutions to:

• Understand end-to-end service delivery
• Identify concentration risks and third-party dependencies
• Ensure resilience across digital and outsourced environments

BNM’s operational resilience direction reinforces the need for integrated mapping across business, technology, and third-party ecosystems.

Hong Kong Monetary Authority (HKMA)

The Hong Kong Monetary Authority requires authorised institutions to:

• Identify critical operations
• Map internal and external dependencies
• Conduct scenario-based stress testing

The HKMA emphasises cross-border and financial ecosystem interdependencies, reflecting Hong Kong’s role as a global financial hub.

Key Regulatory Theme

Across all regulators, a consistent expectation emerges:

Organisations must demonstrate a clear understanding of the interconnections and interdependencies that support critical services.

This confirms that mapping is:

• Not optional
• Not a one-time exercise
• A core requirement for operational resilience compliance

Risk Visibility and Vulnerability Identification

Moving Beyond Siloed Risk Management

Traditional risk management approaches often focus on:

• Individual systems
• Department-level risks
• Isolated control frameworks

This creates blind spots, where critical dependencies remain unidentified.

Mapping interconnections eliminates these blind spots by providing a holistic, end-to-end view of service delivery.

Identifying Hidden Dependencies

Many dependencies are not immediately visible, such as:

• Shared infrastructure across multiple services
• Reliance on a single vendor for multiple systems
• Informal or undocumented manual processes

Mapping reveals these hidden dependencies, enabling organisations to:

• Recognise critical reliance points
• Assess true exposure to disruption

Detecting Single Points of Failure

A key outcome of mapping is the identification of:

• Single points of failure (SPOF)
• Concentration risks
• Critical resource bottlenecks

For example:

• A single authentication system supporting multiple CBS
• A key third-party vendor supporting multiple functions
• A specialised team with no redundancy

Without mapping, these vulnerabilities may remain undetected until a disruption occurs.

Understanding Cascading Effects

Interconnected environments are highly susceptible to cascading failures, where:

• A disruption in one component triggers failures in others
• Impacts spread across multiple services

Mapping enables organisations to:

• Understand cause-and-effect relationships
• Anticipate chain reactions
• Design controls to contain disruptions

Supporting Impact Tolerance Setting

Defining Impact Tolerance

Impact tolerance refers to the maximum level of disruption an organisation can tolerate for a CBS before unacceptable harm occurs.

To define meaningful impact tolerances, organisations must understand:

• What supports the service
• How disruptions propagate
• Where critical thresholds lie

Role of Mapping in Impact Tolerance

Mapping provides the necessary data to:

• Identify critical dependencies affecting service delivery
• Determine time and data sensitivity
• Assess customer and regulatory impact

Without mapping, impact tolerance becomes:

• Arbitrary
• Unrealistic
• Misaligned with actual operational capabilities

Outcome

Accurate mapping ensures that impact tolerances are:

• Evidence-based
• Aligned with real operational dependencies
• Defensible to regulators

Supporting Scenario Testing

Importance of Scenario Testing

Scenario testing evaluates whether an organisation can:

• Continue delivering CBS under stress
• Operate within defined impact tolerances

Regulators expect testing to be:

• Severe but plausible
• End-to-end
• Based on real dependencies

Mapping as the Foundation for Testing

Mapping enables organisations to:

• Design realistic disruption scenarios
• Identify which components to stress
• Assess cross-functional impacts

Examples:

• Cyberattack affecting multiple interconnected systems
• A third-party outage is disrupting multiple CBS
• Infrastructure failure impacting upstream and downstream processes

Enhancing Test Effectiveness

With proper mapping, scenario testing becomes:

• Comprehensive (covers full service chain)
• Realistic (reflects actual dependencies)
• Actionable (identifies true resilience gaps)

Without mapping, testing risks become:

• Superficial
• Isolated
• Ineffective

Supporting Recovery Planning

Limitations of Traditional Recovery Planning

Traditional recovery approaches often focus on:

• Individual systems
• Predefined recovery time objectives (RTOs)
• Static recovery plans

This may not ensure service continuity, especially in interconnected environments.

Mapping-Driven Recovery Planning

Mapping enables organisations to:

• Prioritise recovery based on service criticality
• Understand dependency sequencing
• Coordinate recovery across multiple components

For example:

• Recovering a system without restoring its dependencies may not restore the service
• Recovery must follow the logical sequence of interdependencies

Coordinated Recovery Across Ecosystems

Mapping supports:

• Internal coordination across business and IT
• External coordination with third parties
• Alignment with crisis management and communication strategies

Outcome

Recovery planning becomes:

• Service-driven, not system-driven
• Coordinated, not fragmented
• Effective in restoring end-to-end service delivery

Mapping interconnections and interdependencies is not merely a technical exercise—it is a strategic capability that underpins operational resilience.

Regulators across jurisdictions consistently require organisations to demonstrate a clear understanding of how their critical services are delivered and what they depend on.

This expectation reflects the reality that modern disruptions are complex, interconnected, and systemic.

Through mapping, organisations gain:

• Enhanced risk visibility

• Identification of vulnerabilities and concentration risks

• A foundation for impact tolerance, scenario testing, and recovery planning

Most importantly, mapping enables organisations to shift from a fragmented, process-centric view to a holistic, service-centric approach, ensuring resilience efforts align with what truly matters—the continued delivery of critical services.

In the next chapter, we will examine the core components of interconnections and interdependencies, breaking down the key elements that must be mapped to achieve a comprehensive and effective operational resilience framework.

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