Plan A, plan B and plan C – while you may want option A as your plan of action, sometimes that may not always be what life has in store for you.

Contingency planning or that “back-up plan” is crucial for saving time, money and reducing potential failures.

This applies to both your decisions as an employer and asking your staff to practice contingency planning too. It is proven that by having multiple options to choose from, successes are increased, and failures reduced.

The list below highlights the four major benefits of contingency planning:

1. Damage control

This benefit is an overarching factor to what contingency planning is best at: damage control. When disasters occur, panic arises and the ability to recover quickly reduces.

To maintain order and minimize long-term loss, have those backup plans. Do not wait until the problem happens to deal with it, rather forecast ahead.

2. Operations maintained

If one failure arises and your daily operations crumble, there is improvement required. Contingency planning helps in times of crisis to ensure operations and cash flow are maintained.

Some possible crisis that can affect operations include, machinery breakdown, strikes, climate conditions and lack of working capital.

3. Public Relations is positive

Positive public relations are becoming more important with the rapid spread of information online. One scandal at only one location can spread a bad image on your entire brand.

Being able to communicate a problem to your consumers and solve a problem in a timely manner will help manage your public relations.

Practice communicating bad news and handling crisis communication, listed below are some rules to crisis management:

  • Be transparent and accountable
  • Never cover up information
  • Apologize with a plan for moving forward
  • Act human and sincere
  • Monitor the problem

4. Faster response time

Who likes to be left in the dark about what is occurring? If a plan is already in place, you can put it into action, evaluate and move forward.

The more time you spend on solving an issue while it is happening, the more panic your stakeholders will experience.


A contingency plan is important in times of crisis or even from a daily operational standpoint, for example, when staff are absent, or someone calls in sick.

Resources can be maximized, and profit-loss reduced when public relations is maintained, response time is quick, and overall damage is controlled.