ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A business contingency plan identifies potential risks to your business and outlines the steps or course of action your management team and employees would need to take to combat them. Risks can include a global pandemic, natural disaster, loss of a key employee, supply chain breakdown, a new competitor, and more.

Detailed explanation-2: -A key advantage of effective contingency planning is that it provides working solutions to ensure that the business remains in operation during and after the event, reducing or even eliminating the loss of revenue that comes with operational disruption.

Detailed explanation-3: -A contingency plan is executed when the risk presents itself. The purpose of the plan is to lessen the damage of the risk when it occurs. Without the plan in place, the full impact of the risk could greatly affect the project. The contingency plan is the last line of defense against the risk.

Detailed explanation-4: -It is a detailed strategy for protecting your business against external risks and emergencies, such as natural disasters. Creating a contingency and risk assessment plan involves identifying the potential risk areas to create an effective response should those problems develop.