World Vision International (WVI) is an organization with deep Christian roots and a mission to tackle the causes of poverty and injustice. Founded in the U.S. in 1950, the non-profit organization now operates in nearly 100 countries, with each country’s World Vision office having equal representation and the ability to act independently — much like the way states operate under the federal government.
Each World Vision office relies heavily on revenue streams from support offices, such as the U.S., UK and Canada, to fund the projects carried out by the operations-side of WVI, also known as the ministry. Projects consist of long-term development — building wells and schools, for example — as well as crisis response to natural disasters in places like Haiti, and the Voice for the Poor child advocacy program.
Children in Kasangombe, Uganda learn about HIV/AIDS and other diseases. Education in a vital part of World Vision’s programs.
Unlike for-profit businesses, WVI’s revenue comes from donors instead of customers. In 2010, revenue from private cash contributions, government grants (food and cash), gifts-in-kind and other sources totaled $2.6 billion. Of this amount, World Vision U.S. (WVUS) — the local arm of WVI — raised just over $1 billion.
Until recently, call centers, direct mail, TV and radio were the main drivers and points of contact for World Vision donors. Today, e-mail and text message campaigns, websites, internet marketing and various other social media campaigns also provide significant sources of income. These new donation channels require higher availability and reduce the window within which interruptions are acceptable.
After 9/11, WVUS started to implement formal business continuity practices in order to protect its revenue streams. Starting from scratch, Paul Duke, Senior Enterprise Risk Manager at WVUS, built-out an organization-wide business continuity program by integrating business continuity planning (BCP) software, getting buy-in from business units and executives, and, most importantly, focusing on the people that are affected most by business interruptions.
The Human Impact
Loss of revenue takes on a whole new light when the result is money not reaching communities in need. When quantifying the impact of interruptions — website or call center downtime, for example — the potential loss of revenue is more than meets the eye.
Because many donors will donate more than once, getting new donors “through the door” is vital. As such, downtime results in not only the loss of immediate revenue, but also the future donations from first-time donors.
Take the three days after the 2010 Haiti earthquake, when WVUS brought in $9.3 million through its website alone. Using the concept of long-term donor value — the amount of money donated plus the projected donations from returning donors — this period of uptime for the website is actually worth $28 million to WVUS.
Now, consider the town of Kasangombe, Uganda, where sponsorships for 3,000 children have transformed the community from a place of despair — ravaged by AIDS, poverty and fear — to a village with clean water, crops, health care and education facilities.
The transformation in Kasangombe is the result of $35 per month child sponsorship donations over a five-year period. When such a small amount of money has such a huge impact, even the shortest amount of downtime is quantifiable in terms of children not receiving much-needed assistance.
World Vision’s long-term development projects include teaching families farming techniques and providing them with seeds and tools.
Getting Started, Getting Engaged
When Duke began development of the business continuity program, engaging with the various business units was one of the early challenges.
“I found it most effective to go to the line management and subject-matter expert level to get people engaged. In cases where management wasn’t very engaged, I found that the people who dealt specifically with the operations — technical or subject-matter experts — cared the most and would say ‘If that’s not available, I’m toast.’ It meant something to them and it was easier to engage with those people,” says Duke.
These collaborations yielded some unexpected results.
“Our donations processing group was the first group I approached. Everyone assumed that they needed a high level of availability. But after we did the analysis, we realized that this was not the case. Receiving the donations is critical but processing them very quickly is not, due to the fact that we keep high cash reserves.”
BCP Software & The Culture Shift
Moving from Excel and Word documents to dedicated BCP software was a high priority for Duke.
“We selected the software based on the fact that it was a good fit to our loss-based approach to BC — losing processes and resources.”
The software also plays a role in spreading BC across the organization.
“The vision is to move away from me working directly with each business unit on business impact analysis, BC plans and strategies, and exercises. We’re now moving toward a model — and the software is helping us a great deal with this — where I train the BC coordinators in each business unit. They can then use the software to review and update plans as needed.
“I was looking for something that I could easily push out to BC coordinators embedded throughout the organizations and say ‘With once-a-year training, you’re good to go. It’s up to you to manage this.’
“So the culture is shifting and will continue to shift towards departments being responsible for their own BC, and I’m responsible for the methodology, approach, training, the tools that they use, and reporting to management and the board of directors,” adds Duke.
On top of the benefits of a centralized, standardized software package that can be used throughout the organization, BCP software also helps improve the image and credibility of the BC program.
“The software has a look and feel that says: ‘This is now a program that the organization has adopted, so get onboard,’” says Duke.
As a non-profit, WVUS faces many of the same threats that for-profit business face: Technology issues such as website downtime and phone outages, as well as problems with supply chain and vendor resilience.
“We have a gift catalog that we send out at the end of each year. You can order a goat, school, water well, chickens, clothing and other items needed to support sustainable communities. It’s been an important growth area and revenue stream for us. If a key vendor doesn’t provide its service when needed and we don’t have a backup, the catalog doesn’t get dropped in the mail on the right date — we’re talking about a huge impact.”
Timing is everything in this business.
“We have lots of different types of appeals that go out through a variety of channels. For example, phone and mail campaigns targeting our current and previous donors. If an appeal is delayed, our research shows that the revenue drops. Likewise, if an appeal goes out but no one is there to answer the phone, a percentage of people don’t call back.
“We have many different types of appeals, each targeting specific audiences, so we have to coordinate the appeals carefully to prevent ‘donor fatigue.’ This means that if an appeal is delayed, we may miss the window and lose potential revenue that could be used to serve more children,” explains Duke.
WVUS initially used external call center vendors for some of its call center functions, and developed informal agreements to mitigate the impact of potential disruptions. Today, WVUS is pursuing other options, such as work from home capabilities for a core group of call center personnel.
Exercises are another tool that WVUS uses to prepare for interruptions and test the BC processes it has in place.
“This year we moved to a more robust standard that says all groups with critical processes must undertake an annual tabletop exercise. I support them with templates and scenarios that they can choose from.
“We have also practiced taking down some aspects of our website so that we could bring up the disaster recovery site and see if the alternate technology for the website can talk to the alternate technology for the servers in our data center. This required coordination with some of the disaster recovery vendors,” adds Duke.
Each group is now responsible for their own exercises — Duke simply gives them the tools to complete the exercises and reports on the results.
Until recently, senior management did not require regular reports on the status of business continuity programs — only on an as needed or requested basis. That changed when the organization implemented a new structure for enterprise risk management.
“My job title changed about a year ago from Director of Business Continuity to Senior Enterprise Risk Manager. I now report to the VP of audit and risk management, who in turn has a direct line to the board of directors. By organizationally shifting my role, we’re now able to make BC visible to the board,” says Duke.
Starting next fiscal year, Duke will use a BC dashboard to provide regular reports on program status to both senior management and the board of directors.
At the top of WVUS’s new structure for enterprise risk management sits separate audit, compliance and risk management groups. Business continuity now falls under risk management, along with insurance. Duke is currently working to integrate business interruption insurance with business continuity.
“The first thing is to really understand the nuances of business interruption insurance and make sure it fits our BC plan. For the risks we choose not to spend a lot of effort mitigating with plans or money: Are they the areas we’re sure we have covered? Have we transferred the appropriate risks over to business interruption insurance?
“For example, we increased the number of servers in our data center from 300 to 400 last year — a huge change. We had to look at how the hardware is covered by insurance, and whether we want to cover the entire thing or take a risk and only cover part of it. It’s a collaborate process where we make sure the people in the data center look at each line item for hardware coverage and check that it is appropriate,” explains Duke.
Crossover between business continuity and insurance is bound to increase as more and more organizations move toward similar enterprise risk management models. For more information, see Basic Insurance Optimization For BC/DR.