One of my connections on LinkedIn commented on a pole that I had run last week on the major challenge of power cuts for business continuity. The comment related to how without uninterrupted power one couldn’t really talk about business continuity.
The comment is valid because with the continual power cuts in the country there is continuous disruption to business.
The INTERNATIONAL STANDARD ISO 22301, Security and resilience — Business continuity management systems — Requirements, defines disruption in clause 3.10 as follows: “3.10 disruption incident (3.14), whether anticipated or unanticipated, that causes an unplanned, negative deviation from the expected delivery of products and services (3.27) according to an organization’s (3.21) objectives (3.20).”
Businesses are finding it hard to cope with continuous disruption of power supply. In 2021 there were about 50 days with power interruptions. Some experts forecast about 100 days of power outages for 2022.
As you know, many businesses have been forced to invest in backup power, mainly diesel generation. In the restaurant industry many have gone for gas cooking and diesel generation. Some businesses have made massive investments in hybrid systems, including solar and diesel generation.
But for manufacturing and mining, for instance, these power sources are not enough. Think about a smelter, for example, which needs massive amounts of electricity.
It is an unfortunate situation, especially for manufacturing where production or output is lower because of the electricity outages.
These organizations have made huge investments in the country and cannot operate at full capacity.
Some firms have left the country to operate in more favourable environments, and others are contemplating leaving.
Another problem that is getting worse and worse is that the loss of electricity revenue by metro’s means that they are continually pushing up rates to make up for the shortfalls. The cost of rates has increased substantially (Johannesburg spikes rates continually now with a almost total deterioration in services provided).
This is not a good situation for the economy of the country, which needs economic growth to create employment as well as investment.
Check this link to see how people in other countries (in this case Oxford Policy Management) view the power crisis in the country https://www.opml.co.uk/blog/south-africa-s-crippling-electricity-problem.
Business disruption through power outages is therefore a national calamity.
Many companies have business continuity management systems to prepare for disruptive incidents.
These business continuity plans are put in place to minimise the risk of major business disruptions because of flooding, fires, social unrest and cybercrime.
As we have seen in the case of a car manufacturing plant in Durban, its operations have been down since 11 April 2022.
In a way, a major business disruption like this is not different in principle to the quantum of the continuous business disruptions through power outages. Should you require further information about business continuity, please contact me on my LinkedIn profile https://www.linkedin.com/in/chesneybradshaw/