Risk Management vs. Business Continuity Planning

Risk Management vs. Business Continuity Planning Risk management provides the foundation for BCP. By effectively identifying and mitigating risks, organizations can reduce the likelihood and severity of disruptions. BCP then takes over, focusing on how to respond to and recover from those disruptions that do occur.   In essence: Risk Management: Prevents problems. Business Continuity Planning: Solves problems. While both risk management and business continuity planning (BCP) are crucial for organizational resilience, they serve distinct purposes and work in tandem to protect businesses from disruptions.   Risk Management Risk management is a broader, proactive approach to identifying, assessing, and mitigating potential risks that could harm an organization. It involves: Risk Identification, Risk Assessment, Risk Mitigation, Risk Monitoring and Control. Business Continuity Planning (BCP) BCP is a more specific focus within risk management. It outlines the steps an organization will take to ensure its critical functions can continue operating in the event of a disruption. It involves: Business Impact Analysis (BIA), Developing a Recovery Plan,   Testing and Training, Business Continuity Exercises. These two principles are related in that both are essential for ensuring the long-term viability and resilience of an organization. By effectively managing risks and having a robust BCP in place, businesses can minimize the impact of disruptions and maintain their operations. #BeNewinsurance #InsurTech #inclusiveinsurance #insurance #reinsurance #takaful #climatechange