[OR] [FW] Understanding Operational Resilience Framework

The Backbone of Business Stability: Operational Resilience Framework Explained

Organisations must move beyond traditional risk management and business continuity planning in an era of increasingly complex risks—from cyber threats and supply chain disruptions to pandemics and geopolitical instability.

They must ensure that critical business services can continue and recover quickly, even under adverse conditions. This is where the Operational Resilience (OR) Framework comes into play.

Defining the Operational Resilience Framework

An Operational Resilience Framework is a structured, organisation-wide approach that outlines how a business prepares for, responds to, and adapts to disruptive events that threaten its ability to deliver critical operations.

It integrates various disciplines, such as risk management, business continuity, IT disaster recovery, third-party management, cybersecurity, and crisis management to ensure a unified strategy for resilience.

In simple terms: It’s the “how-to” guide for ensuring your organisation can survive and thrive through disruptions.

Key Objectives of the OR Framework

The Operational Resilience Framework is designed to achieve several core objectives:

Identify Critical Business Services
Determine which functions are essential to customers, markets, and regulators.
Understand Dependencies
Map internal processes, technology, people, and external suppliers that support critical services.
Set Impact Tolerances
Define the maximum acceptable level of disruption (e.g., time, data loss, financial loss) the organisation can tolerate.
Build Capabilities
Implement controls, redundancies, and response plans to withstand disruptions.
Test and Validate
Conduct scenario-based tests and simulations to evaluate readiness and refine strategies.
Monitor and Learn
Establish governance, metrics, and feedback loops to monitor effectiveness and drive continuous improvement.

Core Components of an Operational Resilience Framework

Here’s what a typical Operational Resilience Framework includes:

Component (Plan Phase)	Description
Assess Capability and Maturity	Evaluate the bank’s existing resilience measures and identify areas for improvement.
Analyse Gap	Conduct a thorough assessment to determine vulnerabilities and gaps in the resilience framework.
Develop Strategy and Roadmap	Create a structured plan outlining steps to enhance resilience capabilities.
Confirm Risk Appetite	Define the organisation’s risk tolerance and establish parameters for operational resilience.
Develop and Embed Governance	Implement governance structures to oversee and enforce resilience strategies.

Component (Implement Phase)	Description
Identify Critical Business Services	Determine essential operations that must be prioritised in resilience planning.
Map Processes and Resources	Outline the dependencies and resources required to maintain critical business services.
Set Impact Tolerance	Establish thresholds for acceptable levels of disruption to business operations.
Conduct Scenario Testing	Simulate potential disruptions to assess response effectiveness and identify areas for improvement.
Improve Lesson Learnt	Analyse past incidents and refine resilience strategies based on insights gained.

Component (Sustain Phase)	Description
Introduce Cultural Change	Promote a resilience-driven mindset across the organisation.
Develop Communication Strategy	Establish clear communication channels for crisis response and stakeholder engagement.
Implement Training and Awareness	Conduct regular training sessions to enhance employees' understanding of resilience strategies.
Provide Self-assessment	Enable teams to evaluate their preparedness periodically and identify areas for growth.
Conduct Independent Quality Review	Perform external reviews to ensure compliance with resilience best practices and regulatory requirements.

Why It Matters

An Operational Resilience Framework is more than a compliance checkbox—it's a strategic necessity. Here's why:

Protects customer trust and service availability
Reduces financial and reputational losses
Meets regulatory expectations (e.g., UK’s FCA/PRA rules, RBI’s guidelines, APRA CPS 230, BSP circulars)
Improves cross-functional coordination and accountability
Drives a culture of resilience across the organisation

Framework vs. Policy: A Quick Clarification

While closely related, the Operational Resilience Policy defines what the organisation aims to achieve and who is accountable.

In contrast, the Operational Resilience Framework details how these goals will be achieved through actionable processes and practices.

Regulatory Context

Regulators globally are pushing for formal and tested Operational Resilience Frameworks:

The Bank of England, PRA, and FCA require financial institutions to identify important business services and define impact tolerances.
The Reserve Bank of India (RBI), in its 2024 Guidance Note, calls for a risk-based resilience framework integrated with operational risk management.
APRA CPS 230 mandates the formal establishment of a resilience framework across all APRA-regulated entities.
The Bangko Sentral ng Pilipinas (BSP) also emphasizes operational resilience as a priority for financial stability.

Summing Up ...

The Operational Resilience Framework is the backbone of an organisation’s ability to prepare for, adapt to, and recover from disruptions while maintaining critical services.

It is not a one-time initiative but a continuous journey that requires cross-functional alignment, strong governance, and regular testing.

In today’s uncertain world, resilience is not just a defensive strategy—it’s a source of competitive advantage.

Operational Resilience Framework Versus Policy

More Information About Blended Learning OR-5000 [BL-OR-5] or OR-300 [BL-OR-3]

To learn more about the course and schedule, click the buttons below for the OR-3 Blended Learning OR-300 Operational Resilience Implementer course and the OR-5 Blended Learning OR-5000 Operational Resilience Expert Implementer course.