Understanding scenario testing in operational resilience
Here, we discuss scenario testing, its role in preparing for disruption, and its importance in building operational resilience.
What is scenario testing?
Scenario testing is a fundamental part of an organisation’s operational resilience strategy.
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Operational resilience is the core capability that enables an organisation to adapt and thrive in the long run, even amidst evolving conditions.
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In the context of software, scenario testing is where real-life situations are simulated to check how a particular system performs in those situations. It helps identify and address potential issues and ensures that the software works correctly in various practical conditions.
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In operational resilience, scenario testing is a way to see how well a business or organisation will handle unexpected challenges in real-life situations. It helps them prepare for disruptions like power outages, cyberattacks, or natural disasters by testing how their most important business services will hold up in those scenarios, and if these critical operations have surpassed an acceptable level of impact tolerance.
What are important business services?
Important business services are the essential functions a company relies on to keep running. These are the critical operations that a business can't do without, without risking their ability to provide value.
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Scenario testing is a means to check what the real-time impact would be if any of these services were impacted by an unexpected event or disruption.
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Learn more: Important business services
What are impact tolerances?
For each important business service, impact tolerances must be set for the maximum accepted level of disruption.
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Impact tolerances lay out the maximum level of disruption that can be tolerated. By putting these impact tolerances to the test, scenario testing helps ensure a company does not cross into 'intolerable harm' levels.
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Learn more: Impact tolerances
Scenario testing for business continuity
planning (BCP) vs operational resilience
Business continuity management involves an organisation's ability to maintain operations during unexpected crises, serving as a short-term crisis response strategy. While business continuity addresses immediate challenges, resilience empowers continuous adaptation and improvement to keep up with a dynamic business landscape.
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Scenario testing is a vital component of both processes, enabling organisations to simulate and prepare for various contingencies in both the long and the short term.​
Examples of common scenario tests
Cybersecurity incidents
Simulate a cyberattack, data breach, or ransomware attack to assess your organisation's response, data recovery, and communication strategies.
Natural disasters
Test your readiness for various natural disasters like hurricanes, earthquakes, or floods. Evaluate evacuation plans, emergency communication, and facility resilience.
Supply chain disruptions
Analyse the impact of supply chain interruptions, such as a supplier's bankruptcy or a transportation breakdown, on your ability to maintain operations.
Pandemic outbreak
Given recent events like COVID-19, test your ability to continue operations during a health crisis, including remote work and employee health and safety protocols.
Infrastructure failures
Simulate infrastructure failures, like power outages or IT system breakdowns, to assess your backup systems and recovery procedures.
Regulatory changes
Assess how your organisation adapts to sudden changes in regulations or compliance requirements that may impact your business processes.
Drova for scenario testing
Drova provides a complete governance, risk and compliance solution, integrating all facets of operational resilience. Our platform covers risk management, control assessment, event tracking, contract management, policy compliance, regulatory scanning and more. It not only maps critical processes, but also enhances visibility into third-party resources, supply chains, digital assets, and cybersecurity.
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The operational resilience module in Drova uses AI technology to suggest scenario tests to run, based on your organisation and sector. Soon, you'll be able to find drivers, triggers and other factors to inspire useful scenarios in our AI-powered Scenario Library, which includes mandatory testing required by regulatory bodies like the Financial Conduct Authority (FCA) and the Australian Prudential Regulation Authority (APRA), and other recommended topics based on what is happening within your industry and around the world.
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Access a library of suggested scenarios
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Guided scenario tests are set up for you to execute at the click of a button
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View the results of your tests and how they stack up against your impact tolerances
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Measure your tolerance across a specific duration and see how long recovery would take to ensure that you are not crossing into ‘intolerable harm’ levels
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Maintain a detailed audit trail of all your scenario tests in the centralised platform, including results, tests completed and tests approved