A business impact analysis is a process that helps you identify the effects of a significant disruption on your organisation. You’ll figure out what parts of your business are most crucial and can’t be stopped.
Key Questions to Ask
During this analysis, you’ll answer three important questions:
- In what order should you recover things? This establishes your priorities.
- How long can you be without a critical function? This determines your acceptable downtime.
- How fast do you need to get it back up and running? This helps set your recovery timeline.
Table of contents
- What is it
- Applicability to Small Businesses, Tech Startups, and AI Companies
- Business Impact Analysis Template
- Why you need it
- When you need it
- Who needs it?
- Where you need it
- How to write it
- How to implement it
- Examples of Using It for Small Business
- Examples of Using It for Tech Startups
- Examples of Using It for AI Companies
- How the ISO 27001 toolkit can help
- Information security standards that need it
- List of relevant ISO 27001:2022 controls
- What does a Business Impact Analysis Contain?
- What is impact over time?
- What is Recovery Time Objective?
- What is Maximum Tolerable Period of Disruption?
- Business Impact Analysis Example
- How to Conduct a Business Impact Analysis
- Business Impact Analysis FAQ
What is it
A Business Impact Analysis, or BIA, is basically a deep dive into your business to figure out what could go wrong and how bad it would be. You’re not looking at technical problems like a hacker attack just yet; you’re thinking about the impact on your business. What happens if a key system goes down? How much money would you lose? How long can you survive without it? This process helps you understand your most critical assets and the true cost of their unavailability.
Applicability to Small Businesses, Tech Startups, and AI Companies
The BIA isn’t just for big corporations; it’s useful for businesses of all sizes, including small businesses, tech startups, and AI companies.
- Small Businesses: You have fewer people and resources, so a single problem can hit you harder. A BIA helps you focus on what’s most important to keep your doors open.
- Tech Startups: Your whole business might run on a handful of critical systems. A BIA helps you identify these single points of failure so you can protect them and get back on your feet quickly if something goes wrong.
- AI Companies: Your data and algorithms are your most valuable assets. A BIA helps you understand the impact of losing access to that data or having a model go down. It’s not just about downtime; it’s about the potential for reputational damage and the loss of intellectual property.
Business Impact Analysis Template
The ISO 27001:2022 Business Impact Analysis Template is designed to fast track your implementation and give you an exclusive, industry best practice policy template that is pre written and ready to go. It is included in the ISO 27001 toolkit.
Why you need it
You need a BIA to make smart decisions about your information security. It helps you justify spending money on certain security measures because you can show exactly what’s at risk. It’s the foundation for your disaster recovery and business continuity plans. Without a BIA, you’re just guessing what to protect.
When you need it
You should perform a BIA as an early step when you’re setting up your ISO 27001 Information Security Management System (ISMS). You should also revisit it whenever you have significant changes in your business, like launching a new product, moving to a new office, or adding a major new system.
Who needs it?
The people who need to be involved in a BIA are the folks who really know how the business works. This includes:
- Process Owners: The people responsible for specific business operations.
- Department Heads: Managers who understand the resources their teams use.
- IT Staff: The people who know your technology systems inside and out.
- Senior Management: They need to be involved to approve the final risk levels and priorities.
Where you need it
You need a BIA for every critical business process. This doesn’t mean you have to analyse every single thing you do. Focus on the core processes that keep your business running and generate revenue.
How to write it
- Identify Your Business Processes: List the key activities that make your business work. For a tech company, this might include things like “customer support,” “software development,” or “data processing.”
- Determine Dependencies: For each process, list everything it needs to function: people, software, hardware, and data.
- Analyse the Impact: Ask “what if?” questions. What would happen if this process stopped for an hour, a day, or a week? Rate the impact on a scale from low to high for things like financial loss, reputation, and legal issues.
- Set Recovery Objectives: Based on the impact, decide how quickly you need to get things back to normal. This includes your Recovery Time Objective (RTO), which is how fast you need a system back online, and your Recovery Point Objective (RPO), which is how much data you can afford to lose.
How to implement it
Once you have your BIA, you use the results to build your security and recovery plans. The findings from your BIA will directly inform your risk assessment and help you decide which security controls to implement first.
Examples of Using It for Small Business
Imagine you run a small online store. You realise that your payment processing system is your most critical asset. A BIA shows that if it goes down for more than four hours, you start losing significant sales and customers. The BIA helps you prioritise investing in a redundant payment gateway and a stronger backup system.
Examples of Using It for Tech Startups
You have a new social media app. Your BIA shows that the biggest risk is the database that stores all user information. If that database is corrupted or offline for even a few hours, you could face huge user backlash and lose trust. The BIA tells you that your RTO for this database must be very low, leading you to invest in real-time replication and a robust backup strategy.
Examples of Using It for AI Companies
An AI company uses a massive dataset to train its models. The BIA reveals that if this data is lost or corrupted, you would lose months of work and potentially lose your competitive edge. The BIA highlights the need for advanced data integrity checks, off-site backups, and strict access controls on the dataset.
How the ISO 27001 toolkit can help
The ISO 27001 toolkit includes pre-made BIA templates and guides. This can save you a ton of time and make sure you’re asking all the right questions. It gives you a structured approach so you don’t miss anything important.
Information security standards that need it
This policy is a key part of ISO 27001, which is an international standard for managing information security. Other standards that need it include:
- GDPR (General Data Protection Regulation)
- CCPA (California Consumer Privacy Act)
- DORA (Digital Operational Resilience Act)
- NIS2 (Network and Information Security (NIS) Directive)
- SOC 2 (Service Organisation Control 2)
- NIST (National Institute of Standards and Technology)
- HIPAA (Health Insurance Portability and Accountability Act)
List of relevant ISO 27001:2022 controls
While the BIA isn’t a control itself, its results directly inform the implementation of several controls, especially in ISO 27001:2022 Annex A. Some key ones include:
- ISO 27001:2022 Annex A 5.29 Information security during disruption
- ISO 27001:2022 Annex A 5.30 ICT readiness for business continuity
What does a Business Impact Analysis Contain?
The Business Impact Analysis is required to be presented in a certain way. What we mean by that is that the document is expected to have certain document markup. Document mark up is just a fancy words for having certain information on the document. It will need version control, a version number, an owner, an information security classification.
Critical Business Elements
It will then contain sections for each critical part of your business, these are usually
- People – mandatory
- Technology – mandatory
- Premises – mandatory
- Suppliers – optional
- Customers – optional
What is impact over time?
For each critical business element it will include an assessment of impact over time. This is done by listing out time frames and then assessing the impact of not having that critical element during that time frame.
You would include an impact level definition so you are consistent in your assessment. An example of an impact level assessment would be:
What is Recovery Time Objective?
The Recovery Time Objective (RTO) is the time in which you want or need the critical element to be back operational. This is the target time and it informs your business continuity and disaster recovery implementations that must be aligned to meet this objective.
What is Maximum Tolerable Period of Disruption?
The Maximum Tolerable Period of Disruption (MTPoD) is the amount of time that you can be without the critical business element. How long can you be without this business element and still meet your business objectives and information security objectives.
Business Impact Analysis Example
If you want to have a look at an example Business Impact Analysis PDF click the link. It is redacted in places but gives you a good idea of what good looks like. Here is an extract.
An example of a Business Impact Analysis would be:
How to Conduct a Business Impact Analysis
When you conduct a Business Impact Analysis you are going to be very honest with yourselves when it comes to the analysis. We often see emotions taking over and every department and every team and every system will fight to be seen as priority one. Logically you only have limited recovery resources in both time and people and so you need to be as honest as you can be, park emotion and focus on getting the information as accurate as you can.
To conduct the Business Impact Analysis you would:
- Run a Business Impact Analysis meeting
- Invite representatives from all areas of the business
- Include a least one member of the senior leadership team
- Nominate someone to run the meeting – usually the business continuity manager
- Identify the critical business elements required being at least people, premises and technology
- Complete the Business Impact Assessment template and / or document the required columns
- Seek majority agreement from those attending the meeting
- Minute the meeting
- Send minutes of the meeting and a copy of the BIA to all attendees
- Share both at the next management review for sign off or follow your existing sign off process
Business Impact Analysis FAQ
No, a BIA is a part of a risk assessment. It helps you understand the impact, which is one part of the risk equation.
It depends on your business’s size and complexity, but it can take anywhere from a few days to a few weeks.
Not necessarily. If you have the right people and a good template, you can do it yourself.
At least once a year, or whenever there’s a big change in your business.
RTO is how long you can be without something. RPO is how much data you can afford to lose.
Yes! The BIA is a foundational document that’s useful for both.
You should still analyse it! The impact could be reputational or legal.
Not involving the right people who know the business processes.
Yes. You want to focus on the most critical processes, not every small detail.
You still have business processes that can be impacted! Think about your physical records, your supply chain, or your staff.
Yes, an auditor will want to see that you’ve done the work to understand your risks.
No, it’s a living document that you should update regularly.
You can use a qualitative scale (low, medium, high) instead of specific numbers.
You use the results to do your risk assessment and then create your business continuity and disaster recovery plans.
The Business Impact Analysis is important as it sets out clearly and in written form
what the critical elements of your business are
how long you can go without them
how quickly you need to recover them
the prioritisation of recovery
Many standards and regulations require you to have conducted and document a BIA and this especially true of the most recent update to the ISO 27001 Standard – ISO27001:2022. For ISO 27001 Certification it actually forms part of a wider set of required information security documents that are all included in the ISO 27001 Toolkit.
The benefits of the Business Impact Analysis include:
1. Improved security: security is about availability and a BIA will give you a plan of recovery should the worst happen and a priority order of recovery
2. Reduced risk: Having a business impact analysis reduces the recovery time in the event of a disaster or major incident as you know what must done and by when.
3. Improved compliance: Standards and regulations require a BIA
4. Reputation Protection: In the event of an outage, having an effective Business Impact Analysis will reduce the potential for fines and reduce the PR impact of an event as you will be able to recover faster in a more structured way.
The business continuity manager, department heads and leadership team are responsible for implementing and managing the requirements of the Business Impact Analysis.
Examples of where the Business Impact Analysis can fail or violations of the Business Impact Analysis can include:
Not having a documented Business Impact Analysis
Not conducting a BIA at least annually or when significant change occurs
Not acting on the Business Impact Analysis when an outage occurs
Not implementing and following a Business Impact Analysis can have severe consequences for information security and the confidentiality, integrity and availability of data and systems. The consequences could be legal and regulatory fines and / or enforcement, loss of data, loss of revenue, loss of clients and customers, negative PR.
The approaches to monitoring the effectives of the Business Impact Analysis include:
1. Conducting business continuity and disaster recovery tests
2. Internal audit of the Business Impact Analysis process
3. External audit of the Business Impact Analysis process
4. Review of Business Impact Analysis for anomalies in operation
The purpose of the BIA to is create a blueprint for the prioritisation of recovery of the critical elements that make up your business. So in lay terms, we are look at creating a prioritisation of the recovery of people, premises and technology.
The principle of the Business Impact Analysis is that the business is understood and the impact of outage of various business elements are understood to allow a prioritisation and timeline of recovery.
