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THE BUSINESS CASE FOR PREPAREDNESS: Assets Impact
The value of tangible assets including inventories, property, plant and equipment are protected as a result of preparedness efforts. Intangible assets including know-how and goodwill are generally increased through investment in preparedness.
- Impacts on Transportation Can Create Significant Business Losses
May 24, 2008
Loss of or restrictions in area transportation capacity can result in significant business losses.
Continue reading » - Increased Cashflows and Improved ROI
May 24, 2008
Source: "Creating a Business Case for Security in the Oil Industry", M.C. Wilhelm Associates LLC, Council on Competitiveness, 10/13/2006 Key...
Continue reading » - Protecting Reputation, Operations and New Product Opportunities
May 24, 2008
In the chemical sector, effective security strategies support industry leadership/corporate reputation, reliable and sustainable operations and new product/service opportunities.
Continue reading » - Market Value Impact
May 24, 2008
For banks and insurance companies, operational risk events generally result in a larger market value loss than the actual operational loss. The market may see such losses as signals of poor management quality and operational controls and thus reduced expectations of future cash flows.
Continue reading » - Impacts on Capital Change for Operational Risk, Share Prices and Reputation
May 24, 2008
Management and quantification of operational risk has been impeded by the lack of internal or external data on operational losses. We consider newly available data collected from public information sources, and show how such data can be used to quantify operational risk for large internationally active banks.
Continue reading » - Impacts on Sales Growth, Stock Returns and Shareholder Equity
May 24, 2008
Supply chain disruption events can have significant physical costs (e.g. damage to facilities, inventory, electronic networks, infrastructure) and subsequent losses due to downtime, wages for employees who cannot work and loss of customer goodwill. Significant declines in sales growth, stock returns and shareholder wealth can be expected for two or more years following the event.
Continue reading » - Increased Market Share and Customer Loyalty
May 24, 2008
Supply chain disruptions create shortages similar to demand spikes caused by market supply/demand imbalances. Thus, resilient enterprises can often react more quickly (than their competitors) to changing market demand, winning market share and customer loyalty.
Continue reading » - Resilience Can Offer Competitive Advantages and Boost Earnings
May 24, 2008
"Investing in resilience can have many day to day" benefits for the corporation in addition to more dramatic impacts when disruptions do occur including clear competitive advantages which can boost earnings.
Continue reading » - Drives Business Value Through Improvements in Product Safety, Inventory Management, Supply Chain Visibility, Product Handling, Customs Clearance and Customer Satisfaction
May 24, 2008
Disruptions in supply chains can occur for a diversity of reasons including natural disasters, product contamination and adulteration, shortages, border closings, strikes by ports and terrorism.
Continue reading » - Stock price Performance and Equity Risk
May 23, 2008
Source: "An Empirical Analysis of the Effect of Supply Chain Disruptions on Long-Run Stock Price Performance and Equity Risk of...
Continue reading » - Impacting Stock Returns and Share Price Volatility
May 23, 2008
Supply chain disruptions have substantial impacts on firms including 33 to 40% lower stock returns relative to their benchmarks, 13.5% increase in share price volatility, 107% drop in operating income, 7% lower sales growth, and 11% increase in costs.
Continue reading » - Assuring Continuity / Survival of the Business
May 23, 2008
43 percent of companies impacted by a severe crisis never reopen. 29 percent of those that do reopen fail within two years.
Continue reading » - Minimizing Impact on Reputation and Customer Base
May 23, 2008
"Many senior executives and business managers consider business continuity the responsibility of the IT department. However, it is no longer sufficient or practical to vest the responsibility exclusively in one group. Web-based and distributed computing have made business processes too complex and decentralized. What's more, a company's reputation, customer base and, of course, revenue and profits are at stake. All executives, managers and employees must therefore participate in the development, implementation and ongoing support of continuity assessment and planning."
Continue reading » - Supporting Business Survival / Continuation
May 23, 2008
40 percent of companies that suffer a major business disruption go out of business within two years because they are unable to recover from the long-term affects.
Continue reading » - Sustaining Business Viability
May 23, 2008
Of all businesses that close down following a disaster, more than 30 percent never reopen again.
Continue reading » - Impacting Creditworthiness
May 23, 2008
A firm's level of preparedness can clearly impact its ability to repay debt and deliver value to shareholders. Rating agencies are beginning to recognize this.
Continue reading » - Decreasing Legal Liability
May 23, 2008
"Corporations are vulnerable to significant legal liability if they do not undertake emergency preparedness efforts. This liability can result from several sources including common law negligence, specific legislation/regulations and contractual obligations."
Continue reading » - Impacting Share Price / Market Capitalization
May 23, 2008
Mass fatality events have double the impact on shareholder value than corporate catastrophes in general.
Continue reading » - Increasing Shareholder Value
May 23, 2008
To prosper, organizations must invest in compliance, processes and tools for security. They must also create value from relationships, processes and even products that enable security.
Continue reading » - Minimizing Losses and Sustaining Continuity of the Business
May 23, 2008
The CEO is responsible for informing the Board of Directors about company risks. Business continuity planning addresses corporate governance responsibilities to customers and shareholders. Over a third of CFO's see disaster preparedness and recovery as their largest vulnerability.
Continue reading » - Risk Management Can Impact Shareholder Value and Ability to Generate Positive Returns
May 23, 2008
"Building on the findings of the 2002 Protecting Value Study, the 2003 study asked nearly 400 CFOs, treasurers and risk managers at the world's largest corporations about business interruptions."
Continue reading » - Risk Management Can Increase Shareholder Value
May 23, 2008
Security is a new source of competitive advantage impacting reputation, corporate governance, regulation, corporate social responsibility and information assurance.
Continue reading » - Corporate Security Can Be a Competitive Advantage
May 23, 2008
The business of security has shifted from protecting companies from risks, to being the new source of competitive advantage.
Continue reading » - Resilience Impacts Profitability, Shareholder Value and Competitiveness
May 23, 2008
Almost half of the one thousand largest global companies failed to manage risk systematically and suffered declines in share prices of more than 20% in a one month period between 1994 and 2003.
Continue reading » - Poor Risk Management Can Lead to Decreased Share Price, while Effective Corporate Resilience Can Be a Competitive Advantage
May 23, 2008
Due to many factors, the level of risk has increased for societies and organizations. Furthermore, these risks are increasingly interrelated so that disruptions in one area can cascade and create disruptions in other areas.
Continue reading » - Increasing Shareholder Value
May 23, 2008
Firms that invest in and manage their property risks effectively tend to also create value for the firm.
Continue reading » - Effective Risk Management Drives Business Value
May 23, 2008
There is a clear correlation between companies' risk quality and their financial performance.
Continue reading » - Maintaining Stock Price
May 22, 2008
For Global 1000 firms, there is a high probability of a crisis resulting in substantial decline of stock price during any five year period. How management responds is destiny determining" for both the company and its CEO.
Continue reading » - Protecting Key Assets
January 1, 2006
Inventory, property, plants, equipment and intellectual property are protected as a result of effective preparedness programs. Impact of extreme events...
Continue reading » - Strengthening Reputation & Brand
January 1, 2006
The communication to customers, the media and general public of the business' commitment to corporate preparedness and resiliency can strengthen...
Continue reading »
Financial Impacts of Corporate Preparedness