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What Is a Contingency Plan?

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If things don’t work out as you plan what are you going to do? With a bit of luck you will have a backup plan, and if you don’t then you might be in big trouble. When we make plans we always hope that things will work out as we expect. It doesn’t always happen like that and so it pays to plan for the worst. A contingency plan then is a backup plan that we can turn to when things start to go wrong. All successful companies will have a contingency plan; in fact they will likely have many for the different aspects of the business.

How is a Contingency Plan Created?

Creating this type of plan involves identifying those areas of the business where things can go wrong and planning for how this should be managed. For example, if the business manufactures products that rely on heavy machinery then there may be a contingency plan for what to do during a power outage. Perhaps there will be provisions made for a backup generator and the instructions for changing over this will be provided. If there was no contingency plan then people may just run around like headless chickens. It is usually too late to develop such a plan after the worst has happened.

Contingency Plan for Minor and Major Incidents

A backup plan can be focused on minor problems that could interrupt the day to day running of the business or it could be a disaster management plan. The way that some businesses operate means that there is the potential for something catastrophic to occur and so they need a detailed plan for how to deal with this. An power station will require something like this to ensure that if things go wrong that there operation will be back up and running in the shortest possible time.

There doesn’t have to be a big threat to a business in order for there to be a need to a contingency plan. Sometimes it just helps for there to be a backup plan in case one path doesn’t seem to be going where the business thought it would take them. The fact that they have another plan means that changing direction is not such a huge hassle. This type of alternative strategy can be particularly important when it comes to marketing products.

Conclusion on Backup Plans

It just makes sense that a business should always have a backup plan for anything that could go wrong. When things go wrong it can be highly stressful and it is not the ideal conditions to be searching for a solution. The fact that the solution is supplied before the disaster occurs means that it is just a case of following instructions. Of course the success of this will very much depend on the quality of the plan, and there are some disasters that just can’t be planned for. Overall it is hard to think of any reason not to have these documents that can be so valuable when the need arises.

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Meet the Author

Anthony Carter currently resides in Fife, Scotland with his wife Lisa, and their three wonderful children. As a senior editor for various publications, if he's not reading and writing, you would find him photographing and traveling to some of the most far-flung locations around the world.


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