Discover the full business value of critical event management

Although the benefits of deploying Critical Event Management (CEM) are becoming widely accepted, organizations can often struggle to demonstrate the tangible ROI to their key stakeholders, and can face an uphill battle when it comes to securing budget.  

So, is it possible to put a value on Critical Event Management? To answer this question, Everbridge commissioned global market research firm, Forrester Consulting, to conduct an updated Total Economic Impact™ (TEI) Study, and examine the return on investment enterprises realized by deploying Everbridge’s CEM platform.

To understand the benefits, costs, and risks associated with this investment, Forrester interviewed six representatives from four organizations with experience using CEM. For the purposes of the study, Forrester aggregated the interviewees’ experiences and combined the results into a single composite organization that is a global manufacturing firm with $16 billion in revenue and 30,000 employees. The purpose of the study is to provide organizations with a framework to evaluate the potential financial impact of CEM.

For more information, access the study and other resources such as an ROI calculator that can generate a fully customized report revealing the business value CEM can bring to your organization. 

Read highlights from Everbridge’s placement in the recent The Forrester Wave™️: Process-Centric AI For IT Operations (AIOps), Q2 2023

The biggest feature is event alerting and the record retention. This way, if something goes wrong, we can provide a report of everything that was sent out and everything that was captured.

What is organizational resilience?

Critical events can vary widely in type, severity, and scope—from natural disasters to IT outages—and a drawn-out response can lead to significant operational losses, disruption to supply chains, brand damage, and concerns for health and safety.

Organizational resilience is an organization’s ability to withstand events with the least possible impact on safety, reputation, and operations. But it’s not enough to simply know the definition of organizational resilience. In truth, leaders need to know precisely how to measure business resilience and understand the steps they can take to strengthen resilience in the future.

It’s vital to understand how frequently critical events occur and the research behind why strengthening resilience should be a number one priority for organizations. Creating and maintaining a resilient organization is a long-term strategy that requires full commitment from every business level. Learn more from The Research Behind Resilience, an eBook developed for North American organizations about the data on why prioritizing and investing in resilience matters.

What are the most common critical events businesses face?

According to recent Forrester research, Business Resiliency Is The Bulwark To A World Defined By Systemic Risk And Chaos, systemic risk events are increasing in frequency and magnitude. As their research stated:

• Hurricanes will continue to cause more damage, while being more dangerous and more destructive, due to climate change.
• Wildfires will continue to cause more damage, while being more dangerous and more destructive, due to climate change.
• Pandemics, epidemics, and disease outbreaks will become more frequent. As the world continues to be interconnected, pandemics and epidemics will affect how, when, and where employees can work as well as customer buying patterns.
• Global economic recessions will significantly alter business plans or cause failure. There have been five global recessions since 1960, three of which have been since 1990.

Planning for critical events is a vital part of being a successful business that takes care of its customers, employees, and partners. See how other North American organizations are better managing critical events and strengthening resilience in our latest eBook.

Why do organizations need to be resilient?

North America has experienced an increase in both the number and severity of critical events in the last three years. For example, 83% of organizations that were interviewed for IBM’s “Cost of a Data Breach Report 2022” have now experienced more than one data breach.

The Harvard Business Review stated, “performance during crisis periods has almost three times the impact of performance during stable periods.” The ability to maintain operations during a crisis is imperative to the long-term success of an organization.

How to measure organizational resilience

Measuring organizational resilience is a unique undertaking that requires full organizational transparency, and a thorough understanding of your existing operational structure and continuity planning. When working with Everbridge, our measurement structure evaluates four specific areas:

In most organizations, no single individual has all the details necessary to effectively gauge the resilience of an entire organization. Collaboration across departments and teams that have direct knowledge of these four components can simplify and expedite the process. In our Research Behind Resilience eBook for North American organizations, it was revealed that there’s great potential to build organizational resilience, and doing so ultimately reduces financial losses.

Benefits of a mature approach

A mature approach to critical event management isn’t just a box to check off in executive planning meetings; it’s a greatly beneficial approach that improves business across the board and helps build a resilient organization. By ensuring organizational resilience, you show that you’re dedicated to:

• Keeping people safe
• Maintaining business continuity and operational uptime
• Optimizing supply chains and routes
• Operationalizing the safety of smart buildings and the internet of things (IoT)
• Safeguarding reputation through resilient and responsive IT systems
• Fostering organizational resilience

Resilience is more than just a goal that organizations strive to achieve. With an increased number of critical events, including cyber-attacks, extreme weather and violent crime, resilience is vital for the short-term and long-term success of any operation. Everbridge and Atos sought out to find the links between resilience and success, with a report from Dr. Stefan Vieweg, Director of the Institute for Compliance and Corporate Governance (ICC) at the Rheinische Fachhochschule in Cologne, Germany.

The study comprised responses from 226 businesses across Europe, with a range of employees anywhere from under 3,000 to over 100,000, and across numerous industries. Our most recent blog discussed the importance of resilience and the steps organizations can take to achieve their goals. Dr. Vieweg’s research identified seven key aspects of resilience:  

1. Resilience has a significant impact on the bottom line.  
2. Money is not everything in resilience.  
3. Talking is easier than execution.  
4. There is a reason for resilience among top performers.  
5. An excess of spending does not necessarily help.  
6. There is a sweet spot of resilience investment.  
7. Digitalization and automation matter.

These seven findings can serve as the guide for organizations to assess their own strengths and weaknesses, and map out the policies and procedures they need to implement to improve their resilience.

1. Resilience has a significant impact on the bottom line 

Prioritizing resilience means taking proactive measures to reduce the impact of critical events and recover quickly. Resilience directly affects financial stability, and the data tells the whole story. The most resilient companies suffered only a 7% loss in annual sales revenue due to critical events, compared to 145% of annual sales revenue for underperforming companies. The difference is 20x greater losses.

2. Money is not everything in resilience

According to Vieweg’s research, organizations of all sizes showed a similar trend: underperforming companies almost always spent more on risk and resilience measures than the top performing ones. The biggest reason for this is the cost savings of a unified, automated solution compared to putting out fires with disparate systems each time a new critical event occurs.  

3. There is a sweet spot of resilience investment

That leads to another constant, which is that the optimal financial commitment is between 10-25% of revenue. Companies in this range allowed approximately 30% damage aversion, with companies under 50,000 employees performing slightly better. Spending more is not as important as spending wisely, namely with digitization and automation.  

4. An excess of spending does not significantly help 

While investing in resilience is critical to success, Vieweg’s research found that spending beyond 25% of annual revenue on resilience has diminishing returns. Organizations need to make careful plans for future investments to maximize return on investment.  

Similar to the reasoning in the finding that money is not everything in resilience, some decision makers may feel that spending on specific solutions to solve for risk management, digital security, employee communication, and other aspects of resilience is beneficial, when in reality, investing in one platform that provides an integrated solution for organizational resilience will save time, effort, and money.  

5. Digitization and automation matter

Dr. Vieweg’s research found a direct positive correlation between the degree of digitalization and preparedness for a critical event, particularly in terms of identifying risks. Among the top performing organizations, 46% have an early-warning system established, but only 29% of those surveyed reported very high levels of automation across processes.  

Dr. Vieweg concluded that there is a significant potential to improve resilience across organizations of all sizes with automated, integrated risk management processes.  

6. Talking is easier than execution

Over 60% of the organizations in the study acknowledged that critical events have become more frequent, more unpredictable, and have had a larger impact. But less than 50% have explicit resilience goals operationalized.  

7. There is a reason for resilience among top performers

The most resilient organizations not only implemented resilience measures and risk management solutions at a higher pace than others, but these methods proved effective, were used continuously, and introduced avenues of mitigation. Over 50% of the top performers have an established risk management process.