Huw Hilditch-Roberts, director in charge of the Institute of Consulting and Chartered Management Institute (CMI) says, ‘The recent, unexpected and shocking riots, which caught the government and police off guard, is a stark reminder to businesses of the importance of contingency planning.

‘If a business fails to plan, it plans to fail; we all know this, and history has proved that if plans are in place, business damage is minimised and recovery is faster in the event of a crisis.’

According to the CMI’s 2011 business continuity management research, 84 per cent of organisations that had contingency plans in place and needed to activate them in the last year found that business disruption was reduced and they recovered faster.

However, even though 82 per cent of managers view contingency planning as important or very important, fewer than half of businesses (49 per cent) are prepared for unexpected threats. Worryingly, UK businesses are leaving themselves open to risk and are highly vulnerable in their failure to plan.

Effective contingency planning requires careful preparation, investment and resources, involving brainstorming worst case scenarios and planning for every possible eventuality, says the IOC.

Processes, responsibilities and communication plans need to be put in place as part the planning so when disaster strikes, the wheels can be set in motion immediately, with everyone within an organisation confident about the role they will play, adds the organisation.

Hilditch-Roberts also says that businesses must invest in cultivating leaders and ensure any appointed ‘deputies’ have the training, support and authority they need to act on their leader’s behalf, as well as the need for clear, tested, well-communicated plans being put in place before these deputies are expected to step up.