Top 5 Mistakes Credit Unions Make When Buying A Business Continuity Solution
Business Continuity isn't a new topic to credit unions. In fact, long before the Pandemic scares we had what was commonly known as the "Business Resumption Plan". So if you think that experience brings success, I'm sorry to say that is not always the case! So if you're a credit union business continuity leader and want to avoid making mistakes during your implementation then this post is for you! Let's count them down.
TOP 5 MISTAKES WHEN DEVELOPING YOUR CREDIT UNION BUSINESS CONTINUITY PLAN
Mistake #5 - The IT leader is forging the way
Incredibly (after 20 years of doing this stuff), I still see this mistake being made all the time and as a consultant, it makes the hairs on my arms stand up when I am ONLY speaking with the IT person at an organization. Business Continuity DOES NOT EQUAL disaster recovery (DR). DR is the IT portion of the complete BC program. BCM requires a top-down holistic approach that engages first the C-level and then the entire organization in ownership of the strategy. Without it, your efforts will fail.
Mistake #4 - Thinking your worst case scenario is losing your data center
Gone are the days when losing your data center will cripple your credit union. Most savvy credit union technology leaders have long ago implemented some version of replication and/or warm/hot sites. Many of these solutions give the credit union adequate time to restore full service while sustaining critical operations. So what is your worst case scenario? I'd venture to say the loss of critical 3 party providers such as card services, online banking or even your ATMs. Why? These alternate delivery channels buy you critical time to restore your core. Most credit unions have stand-in processors and many have critical services such as online banking, billpay and ATMs hosted (oops dare I say clouded) to ensure continuity should a crisis hit their primary data center.
Mistake #3 - Buying a TESLA when a FORD will do
Bells and whistles are great! Or are they? It's tempting I know, especially if you just came back from a conference where you sat through this incredible demo. The software solution had great visuals, a mobile app and maybe even pre-populated business impact analysis (BIA) data. So you rush to sign up and even have a consultant come onsite to work with you but the minute they're gone, you simply can't deploy it because it has TOO MUCH GOING ON for even you to keep up without the help of the consultant. I've seen many successful credit union leaders implement great strategies using WORK and EXCEL. The point is, it has to be a viable plan and everyone should be able to execute their portion without special training.
Mistake #2 - One Size Fits All
Let me ask you this - Is your credit union EXACTLY like your peer down the street? Do your staff have the EXACT same training? Even if you have the same core processor, are ALL your 3rd part vendors exactly the same? Of course not, that is why your credit union business continuity plan should be UNIQUE to your credit union. The solutions that pre-populate your processes by departments or recovery mitigations based on a template are doing you and your membership a disservice. Credit union leaders who understand their membership also understand that each recovery will be different that the last. The key is developing a resilient culture with clearly defined priorities. Mimicking a "best practice" paper or your peers sample may cost you time and money when it comes to a crisis response.
Mistake #1 - Not defining their credit union tolerance for risk
We've seen the stories of organizations that rebounded brilliantly during crisis such as Hurricane Sandy or Winter Storm Jonas. These credit unions stood out from the rest, not because they came back up/online faster than anyone else, but because they understand their tolerance for certain levels of risk and took measures to protect and mitigate to meet those goals. For example, one credit union I know had a very small physical presence with just three branches. However, they serviced roughly 50K members all over the world. This leadership team knew their tolerance level for loss of card services far outweighed something more traditional like buying a generator for their one branch. Hence, it wasn't a surprise when stand-in services were budgeted for and ultimately put into place. When looked at holistically, these decisions become easier as you are able to identify what is important to your specific credit union. Get your team talking about your risk tolerance PRIOR to developing your plans and implementing software applications.
Is your credit union ready for the inevitable next business disruption? Have you had your BCP reviewed by a certified consultant to identify GAPS? Our team at BConView are just waiting to help. Reach out today for any assistance you need.
