CBCP-002 Certified Business Continuity Professional (CBCP) Questions and Answers

Risks are diverse and arise from both external and internal sources. This is true because risks are uncertainties that can have positive or negative effects on an organization’s objectives. Risks can arise from various sources that are either outside or inside the organization’s control. External sources of risk include natural disasters, cyberattacks, market fluctuations, customer preferences, competition, regulation, or political instability. Internal sources of risk include human error, fraud, system failure, process inefficiency, organizational culture, or strategic decisions. Verified References: https://www.investopedia.com/terms/b/businessrisk.asp https://www.thebci.org/training-qualifications/good-practice-guidelines.html

Risk control is the control mechanism that is the process by which an organization reduces the likelihood of a risk event occurring or mitigates the effects should it occur. Risk control is the process of implementing measures or actions to modify or influence the risk level of an organization. Risk control can involve various strategies, such as avoidance, reduction, transfer, sharing, retention, or acceptance. Risk control can help to improve the organization’s resilience and performance. Verified References: https://www.investopedia.com/terms/r/risk-control.asp https://www.thebci.org/training-qualifications/good-practice-guidelines.html

Business risk is the risk of loss or damage to an organization’s performance, reputation, assets, or stakeholders due to internal or external factors that affect its ability to achieve its objectives. Business risk can arise from various sources, such as market conditions, customer preferences, competition, technology, regulation, compliance, operations, finance, human resources, or natural disasters. Business risk can have a direct or indirect impact on an organization’s profitability, growth, sustainability, or continuity. Verified References: https://www.investopedia.com/terms/b/businessrisk.asp https://www.thebci.org/training-qualifications/good-practice-guidelines.html

Operational risk is the type of risk that is related to human error or achievement. Operational risk is the uncertainty or variability of the execution or outcome of an organization’s functions or processes. Operational risk can result from factors such as inadequate policies, procedures, systems, controls, skills, training, supervision, or compliance. Operational risk can affect an organization’s operational efficiency, quality, safety, security, reputation, or profitability. Verified References: https://www.investopedia.com/terms/o/operational_risk.asp https://www.thebci.org/training-qualifications/good-practice-guidelines.html

In pre-crisis management, CM activities are focused on prevention and preparedness activities. This is true because pre-crisis management is the phase before a crisis occurs, where the organization tries to anticipate and avoid potential crises or reduce their likelihood and impact. Pre-crisis management involves activities such as risk assessment, business impact analysis,business continuity planning, contingency planning, crisis communication planning, training and awareness, testing and exercising, monitoring and reviewing. Verified References: https://www.cisco.com/c/en/us/solutions/hybrid-work/what-is-business-continuity.html https://phoenixnap.com/blog/what-is-business-continuity-management

Threats can be considered any events or situations that can cause harm or disruption to an organization’s functions or processes. Threats can be natural, human-made, or technological in origin. Some examples of threats are water (such as floods, leaks, or spills), technology failure (such as system crashes, cyberattacks, or power outages), and fire (such as arson, accidents, or explosions). Verified References: https://www.iso.org/publication/PUB100442.html https://phoenixnap.com/blog/what-is-business-continuity-management

Continuity planning with external stakeholders, such as key suppliers, is essential to ensure the uninterrupted flow of information, materials, products, and services during disruptions. The type of continuity planning determines the nature of the relationship and coordination with these suppliers:

Multilateral: This involves multiple parties (e.g., an organization and several suppliers or partners) working together in a coordinated plan. While multilateral planning can enhance collaboration across a broad network, it is complex and not specifically tailored to strengthening individual supplier relationships, which is the focus of this question.

Bilateral: This refers to a two-party agreement or plan between the organization and a specific supplier. Bilateral continuity planning fosters a direct, functioning relationship with key suppliers, enabling mutual understanding, aligned recovery strategies, and stronger assurances of continuous supply. It is the most effective approach for building robust, one-on-one supplier relationships, as it allows for tailored coordination and commitments.

Unilateral: This is a one-sided plan where the organization develops its continuity strategy without direct supplier involvement. While it may address internal resilience, it does not enhance the functioning relationship with suppliers or provide assurances of their continuity, making it inadequate for this purpose.

The correct answer isB. Bilateral, as it directly enhances the relationship with key suppliers through mutual planning and coordination, ensuring a continuous supply chain. This aligns with Business Continuity Professional practices that emphasize collaboration with critical external dependencies.

References:

DRI International Professional Practices for Business Continuity Management (2023), Section 4: Business Impact Analysis and Risk Assessment – Highlights the importance of engaging key suppliers in continuity planning.

ISO 22301:2019, Clause 8.2.3 – Emphasizes identifying and managing dependencies, including suppliers, through coordinated planning.

Business impact analysis (BIA) is the process of identifying and prioritizing the organization’s functions and processes based on their importance to the organization’s objectives, and assessing the potential impacts of a disruption to those functions and processes over time. The BIA helps to determine the recovery time objectives (RTOs), recovery point objectives (RPOs), and resource requirements for each function and process, as well as the interdependencies and dependencies among them. The BIA provides the basis for developing recovery strategies and plans. Verified References: https://www.ready.gov/business-impact-analysis https://drii.org/resources/professionalpractices/EN

Business continuity planning is not a one-time activity, but a dynamic and ongoing process that needs to be reviewed and updated regularly to reflect changes in the internal and external environment. The frequency of review may vary depending on the nature and size of the organization, but it is generally recommended to conduct a review at least annually or whenever significant changes occur that may affect the continuity of the organization’s functions and processes. Such changes may include organizational restructuring, new products or services, new technologies, new regulations, new threats or vulnerabilities, or lessons learned from incidents or exercises. Verified References: https://www.ready.gov/business-continuity-plan https://drii.org/resources/professionalpractices/EN