Business disruptions can be potentially fatal to an enterprise. At the very least, disruptions can lead to lost market share, lost goodwill, and a decline in shareholder value. In a worst case scenario, disruptions can lead to a business failure. To limit the potential financial impact, companies need to improve its capability to respond rapidly and appropriately to business disruptions. While not every business risk can be eliminated. Many risks can be better managed with an appropriate contingency plan. Gary Hamel and Liisa Valikangas write in Harvard Business Review that to contain business risk within acceptable levels, an enterprise and its value chain partners must ensure that their combined infrastructure is resilient, recoverable, and adaptable. A resilient infrastructure can protect the ability of the value chain to deliver goods regardless of unexpected events. This manifests itself in an agile, available and recoverable business processes, technologies and organizational constructs (Hamel & Valikangas, 52).
Organizational effectiveness measures how successfully organizations achieve their missions through core strategies. Given the increasingly complex environments in which all firms operate, the capabilities that supported past performance will not work as well in the future. Senior management must understand the implications of this gap between current practice and emerging needs. To create a resilient business structure, management must search for models that help explain what is happening in the organizational environment. They must understand how organizations can achieve superior performance by developing more adaptive capabilities and skills. Stephanie Sanborn in InfoWorld explains that Business continuity can be strengthened through distribution -- moving information, business applications, and computing power away from the central office so business can get back up and running relatively quickly, without...