Glossary term
Important Business Service
Subject: Risk Management, Business Continuity and Resilience
Also known as: critical business service
An important business service is something a firm delivers to people outside it, such as paying out claims, where a lengthy failure would seriously harm customers, markets or the firm's own soundness.
Explanation
Operational resilience rules ask firms to look at what they deliver to the outside, not at internal systems. A service is something that ends with a client, such as making a payment, accessing a deposit or settling a trade. Firms list their services, judge which are important by the harm that disruption would cause, and document the people, processes, technology, premises and suppliers each depends on. That mapping then shows weak points and sets the scope for impact tolerances and testing. The term is used mainly in the UK, while other regimes use critical operations, critical functions or critical business services for similar ideas. It is different from a critical internal process, since a back-office task can matter without being customer-facing. Choose too few and customer outcomes go untested; choose too many and nothing gets proper attention.
Example
An insurer lists its services and decides that claims payment for motor customers and the policy renewal portal are important, because a long outage would leave people without cover or compensation. Internal reporting is not. For claims payment, it maps the claims system, three suppliers and the staff team involved, and finds that one supplier has no backup.
Not to be confused with
- Critical Third Party
- A critical third party is a supplier whose failure could harm many firms. An important business service is something a firm itself delivers.