Mitigating disruption in times of crisis:Considerations for business leaders in response to COVID-19
The number of COVID-19 confirmed cases is increasing and government responses are escalating rapidly around the globe. The coronavirus pandemic and the resulting decline in business performance, stock markets and consumer confidence could lead us into a global recession. In order to weather the storm, business leaders need to execute their crisis and business continuity plans – or rapidly develop them if they are not yet in place – to mitigate the disruption to their operations. A coordinated response is vital, and business leaders need to ensure they have the right people in their response team, who know what their roles and responsibilities are in areas such as human capital, IT, supply chain, communications and finance. Here we discuss a couple of critical business areas and actions leaders should consider in response to COVID-19.
Ensuring the wellbeing of staff is the first response most business leaders had these past few weeks as the COVID-19 outbreak started to escalate. To keep them safe, you need to know exactly how many staff members are in which locations and how vulnerable they are working from those locations. General advice from World Health Organisation (WHO) and local authorities is to suspend all business travel unless absolutely necessary and staff members are advised to work from home where possible. But this might be easier said than done. While 81% of business leaders are exploring more flexible work arrangements, many are not ready to be fully operational through remote working. There will always be cases where staff cannot work remotely, and you need to provide safety and support to those who cannot work from home. What kind of protective measures can you put in place? What would the impact be if they could not continue working and are forced to stay at home? Stabilising your workforce is the first thing you must do in response to COVID-19.
Your CTO or Head of IT plays an essential role in your response to mitigating the disruption of COVID-19. In order to keep your business going with a remote workforce, you must have a solid IT infrastructure in place. But that is not the only reason why. Just think about all the processes in your business that rely on technology. The systems that are linked to the Cloud or are running through automation. These all need to keep going and be looked after. Businesses are most vulnerable in times of crisis. So, while you are working to keep operations running in the midst of a pandemic, there are other threats still out there. Cyber security is an important one to keep on your radar. Employees working from home use their own internet connections and perhaps their own devices. These are ideal circumstances for cyber criminals to attack and very real threats you need to be prepared for.
Stabilising your supply chain
The coronavirus pandemic is having a big impact on global supply chains. Some of the areas most affected are vital to global supply chains across a wide vertical of sectors. Having a clear understanding of your supply chain across tiers and from raw materials to end product, will help identify where you are most vulnerable. Assess where your most critical products and materials are sourced from and what your options are for back-up suppliers. Do you need to find new or back-up suppliers and what are your protocols for sourcing them? What does your inventory look like? Does COVID-19 have an impact on sales and overall demand of your products? You need to assess your most critical products and how best to stabilise your supply chain.
Communications are vital
Keeping both internal as well as external stakeholder groups well informed is key to successful crisis mitigation. We are all aware of the power the media has and how easily mis-information can be spread, causing panic and damaging trust. You need to carefully manage the messages you are sending to audiences ranging from staff to customers, to board members and your local community. How are internal communications to staff managed? What is the process for urgent or critical communication to internal audiences? What is our response to the press? And last but not least, how are we managing communications with customers? A solid communications strategy is essential during the response phase of a crisis. While most leaders are faster to respond with internal communications, external communications are equally if not more important. B2C businesses are wise to add resource to customer services teams and ensure information to customers is timely and on message. This is a critical time to win and maintain trust.
It is hard to say how the coronavirus pandemic will evolve in the weeks and months ahead, and what the long-term impact will be. The World Bank, IMF and OECD expect the impact on the global economy to be significant. McKinsey forecasts two possible scenarios.
For business leaders evaluating their continuity plan, it is important to use scenario analysis and model these to your business to determine your next steps. From financial stress-testing and workforce planning to supply inventory. Assess your recovery timeline and continue to use the latest data in your scenario modelling to amend your repose accordingly. The current outlook may be gloomy, but you need to keep an optimistic long-term perspective for when your business can restore normal operations.