Business Continuity Planning Myths Debunked

Business continuity plans (BCPs) establish recovery and remediation frameworks to help organizations limit possible damage and ensure crucial business functions can continue when various disasters and emergencies strike. BCPs also outline protocols to minimize the risk of these events causing widespread destruction and disruptions in the first place. These plans are essential for organizations across industry lines and can make all the difference in fostering disaster resilience amid unforeseen circumstances.

Despite the importance of business continuity planning, certain myths have led some organizations to make false assumptions about BCPs, many of which undermine these plans’ depth and overall value. This article debunks some of the most common misconceptions surrounding BCPs.

Myth: BCPs are only essential for large corporations or those prone to natural disasters.

Some organizations may believe that BCPs only make sense for large businesses with more people and assets to protect. Nevertheless, these plans are imperative for organizations of all sizes, especially small businesses. Due to their limited capital, small organizations are more likely to encounter major financial challenges from a single disaster, potentially leaving them unable to recover.

In fact, multiple studies found that between 40% and 60% of small businesses fail shortly after experiencing a crisis. For example, the U.S. Bureau of Labor and Statistics reported that more than 100,000 small organizations permanently closed their doors due to the fallout from the COVID-19 pandemic.

Some organizations may also assume that BCPs are only valuable for organizations located in areas more prone to natural catastrophes. While these catastrophes can certainly be devastating and require proper planning, they comprise only one of several types of emergencies that BCPs can help address. Organizations located in less catastrophe-prone regions could still be susceptible to cyberattacks, public health crises, supply chain incidents and other impactful events.

Myth: Business continuity planning is solely an IT matter; backing up critical data is sufficient.    

Organizations may mistakenly limit their BCPs to their IT operations, assuming that technology-related disruptions are the only costly or damaging type of emergency and that conducting frequent data backups will solve any issues. Even though technology may play a substantial role in performing critical business operations and services, other aspects are involved in remaining functional and reducing possible losses in times of disaster. 

What’s more, data isn’t the only asset that requires protection when these events occur. A successful BCP should aim to protect an organization’s entire operational framework and infrastructure while safeguarding its people and property. Further, these plans can’t be restricted to technology-related disruptions; they should address a range of disaster scenarios to ensure maximum preparedness.

Myth: BCPs aren’t worth the cost and effort required to implement them.         

Organizations may believe that they can’t afford to establish BCPs, but the reality is that they can’t afford not to. Although these plans require initial investments, they are well worth it to combat the cost of a large-scale disaster, as just one disruptive event could generate millions of dollars in losses. This means that investing time and money in business continuity planning now can prevent organizations from facing significant financial challenges in the future.

Myth: Business continuity planning simply isn’t necessary; organizations can just decide how to respond to disasters in real time.        

Some organizations may neglect to create BCPs under the assumption that they will be able to navigate emergencies on the spot. Yet, this approach could pose serious consequences. When a disaster strikes, time is of the essence; taking even a minor pause to determine response and recovery measures could leave the door open for additional damage and disruptions to occur, resulting in exacerbated losses. Not to mention that a lack of business continuity planning could add another layer of stress and confusion when unexpected events arise, causing extra chaos and increasing the likelihood of miscommunication during the restoration process.

Altogether, this approach could lead to prolonged operational downtime and considerable reputational damage. By developing detailed BCPs before disasters occur, organizations can equip themselves with the steps and resources necessary to ensure a swift and calm response amid these events, keeping associated losses to a minimum.

Conclusion      

Disasters can happen at any time, making it vital for organizations to be prepared for these events and have effective protocols in place to help them respond and recover. With effective BCPs, organizations can be ready to handle a variety of emergency scenarios, therefore mitigating associated damage and disruptions. Contact us today for more risk management guidance.

This Risk Insights is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice. © 2025 Zywave, Inc. All rights reserved.