Business Impact Analysis


A business impact analysis (BIA) is a process that identifies the critical elements of an organization’s operations and data and develops strategies to recover quickly from any disruption or disaster. A BIA helps you identify the most critical assets and activities your organization needs to protect and enables you to prioritize recovery efforts in the event of a loss. A BIA can also be used to evaluate your current level of preparedness for such events and determine where there are gaps between what you want to achieve in business continuity planning (BCP) compliance versus what you have accomplished thus far.


Benefits of BIA:

  • Helps you identify the most critical assets and activities your organization needs to protect.
  • Helps you prioritize recovery efforts.
  • Helps you identify the resources necessary to recover from an incident.

Business Impact Analysis Overview

Business Impact Analysis (BIA) helps you understand what would happen if a business disruption occurred and how long it would take to recover.

You can use BIAs with other IT planning methods, including Service Level Assessments (SLAs), Capacity Management Plans, Disaster Recovery Plans, Risk Management Plans, and Regulatory Compliance Programs.

Business Impact Analysis Process

The BIA process can be broken down into two phases. The first phase is the preparation, where you will gather data about your business and its critical systems. The second phase is the actual Business Impact Analysis (BIA).

The BIA’s purpose is to identify an incident’s impact on your organization’s ability to continue business operations. In order for it to be valid, it must:

  • Demonstrate that you have researched all relevant areas
  • Represent a comprehensive view of all types of incidents (including natural disasters) that could affect your organization

Business Impact Analysis Phase 1 – Preparation

Understanding the business and its environment

Understanding the organization’s goals and objectives

Understanding the business impact of a potential incident

Understanding the potential impact on the organization’s reputation

Business Impact Analysis Phase 2 – Identification of Assets and Stakeholders

The second phase of business impact analysis is all about identifying the assets, stakeholders, and dependencies.

  • Asset Identification:
  • Identify the assets critical to the business, including physical (buildings, vehicles, etc.) and intangible (e.g., intellectual property).
  • Identify who owns or has access to these assets. This can be people but also other companies, competitors, or governments.
  • Stakeholder Identification:
    • Identify who is critical for your organization operationally or strategically. These can be customers/clients/partners and suppliers as well as employees (if there is a disruption in operations, it might have negative effects on them). For example, if you have an office building, you need employees to operate from this building; otherwise, it will become empty after some time(which may lead to further losses if no steps are taken).

Business Impact Analysis Phase 3 – Determination of Criticality and Recovery Time Objectives

Determining criticality and recovery time objectives is crucial in the Business Impact Analysis process. How you determine these two things will depend on your organization’s unique circumstances and risk profile.

The following questions can help you determine the criticality of your business systems:

  • Does it impact our ability to conduct basic operations?
  • Can we continue providing goods or services without this system?
  • Will we lose customers if the system isn’t operational?

Once you have identified which systems have high-level importance, it’s time to find out how long they should be offline before they become unusable. This is where Recovery Time Objectives come into play. Recovery Time Objectives (RTO) tell us how long we can afford for our most important components to remain unavailable before they cause unacceptable damage. RTOs should be established based on data collected from past incidents, but they also need to be flexible enough to adapt as new threats emerge.

Business Impact Analysis Phase 4 – Qualitative Risk Assessment

After you’ve completed the three phases of your BIA, you’ll be able to determine the likelihood of each risk and how it will affect your organization. This can help you prioritize which risks to mitigate first.

To complete this step, answer the following questions:

  • What are all the risks that could happen?
  • How likely is each risk to occur?
  • What would be the impact if this risk were realized?
  • What is the probability that this particular event will happen?

Business Impact Analysis Phase 5 – Quantitative Risk Assessment

In the fifth and final phase of the Business Impact Analysis, you will use quantitative risk assessment to measure the impact of a threat on your organization. Quantitative risk assessment uses mathematical modeling to predict the likelihood and severity of a disruption. It’s an important part of any Business Impact Analysis because it can help you understand how critical systems work together to support your business functions and how they may fail. This is useful information when determining your recovery strategy to prioritize what needs to be recovered first in case of disaster or interruption.

You’ll start by identifying which threats could impact your organization’s three main functions (operations, finance and/or administration). Then for each function, multiple processes need to be assessed for their potential impact if disrupted; these are known as assets within ITIL terminology.

Business Impact Analysis Phase 6 – Development of Response Plan Actions

The final phase of the Business Impact Analysis is to develop the response plan actions. The goal during this phase is to identify the recovery time objectives, recovery point objectives, and contingency strategies.

The first step in developing action items is identifying the recovery time objective (RTO) and recovery point objective (RPO). Recovery Time Objective states how long your organization will take to recover from an outage or disruption event before normal business operations can resume at pre-disruption levels. Recovery Point Objective refers to the amount of data loss that can be tolerated if a disruption occurs before you complete your backup process.

Once you have identified your RTO and RPO, you should identify any contingency strategies needed for the response plan actions to work effectively. Contingency Strategies are plans for dealing with unplanned outages or disruptions that may occur during planned downtime activities or maintenance windows. A good example would be using a software package such as Microsoft System Center Configuration Manager (SCCM) or Microsoft Intune as part of your contingency strategy so that when there are problems installing software updates due to security updates being unavailable on Windows Update, then SCCM kicks into gear automatically downloading required files from Microsoft using either HTTPS/HTTP protocol depending on whether HTTPS access has been enabled within SCCM itself plus allowing users access via their accounts only rather than creating new ones just for each user they want who needs access while also allowing them choice over which devices they want to be installed onto based on what makes sense at any particular time versus installing everything blindly across all devices regardless which ones need updating right now because maybe some people don’t use those specific applications anymore but don’t want them uninstalled either so instead

Business Impact Analysis Phase 7 – Implementation of Response Plans and Preparation of Contingency Strategies

At this phase, you will

  • Identify the most critical assets and activities that your organization needs to protect.
  • Implement the response plan actions.
  • Prepare contingency strategies.
  • Establish a recovery process.

It is important to have a clear idea of your organization’s goals for each phase of the BIA process so that you can measure progress throughout each phase.


At the end of the day, a Business Impact Analysis aims to help you prioritize your recovery plan and prepare for an event that could cause damage to your organization. This process should be done at least annually, as well as whenever there are major changes in your business processes or technology that could impact how you respond in times of crisis.

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