A recent internal risk review reveals the majority of core IT application recovery time objectives...

Recovery time objectives (RTOs) are the maximum acceptable time frames for restoring the critical functions and processes after a disruption1. RTOs are derived from the business impact analysis (BIA) andreflect the organization’s risk appetite, which is the amount of risk that an organization is willing to accept to achieve its objectives2. Risk tolerance is the level of risk a company is willing to tolerate, and it is affected by a number of factors, including how much uncertainty or financial loss can be tolerated and where those losses will impact operations3. Risk tolerance is used to measure if the risk exposure is within the risk appetite and to implement controls to reduce the residual risk to an acceptable level2. If the majority of core IT application RTOs have exceeded the maximum time defined by the business application owners, it means that the organization is not meeting its risk appetite and is exposed to more risk than it can accept. Therefore, the most likely change as a result is to adjust the risk tolerance to reflect the current reality and to take actions to improve the recovery capabilities and reduce the risk exposure4. Risk forecasting is the process of estimating the potential outcomes and impactsof future events that may affect the organization’s objectives5. Risk forecasting may change as aresult of the RTOs exceeding the maximum time, but it is not the most likely change, as it does not directly address the gap between the risk appetite and the risk exposure. Risk likelihood is the probability of a risk event occurring5. Risk likelihood may change as a result of the RTOs exceeding the maximum time, but it is not the most likely change, as it does not directly measure the impact of the risk event on the organization’s objectives. Risk appetite is the amount of risk that an organization is willing to accept to achieve its objectives2. Risk appetite may change as a result of the RTOs exceeding the maximum time, but it is not the most likely change, as it is a strategic decision that reflects the organization’s vision and mission, and not a tactical response to a specific risk event. References = Risk and Information Systems Control Study Manual, Chapter 5: Risk Response and Mitigation, Section 5.3: Business Continuity Planning, pp. 227-238.