As COVID-19 (coronavirus) spreads through globally, firms and businesses have to follow a continuity plan. Global companies should be predictive and proactive in their decision-making to preserve business continuity.
A recent Goldman Sachs survey showed more than 1,500 small business owners said they didn’t think they could continue operating their businesses for more than three months, amid the current conditions caused by the coronavirus outbreak.
In critical situations, managers need to stay calm. Besides, companies need to expand flexible work arrangements and other policies that allow people to work remotely and safely. Depending on the sector, companies will want to reorganize teams and reallocate resources. Besides, companies should follow policies that support a safe working environment.
Where telecommuting or flexible work arrangements aren’t possible and companies must have workers on-site or in direct contact with customers, it is important to provide infection protection measures.
Reshape for COVID-19 Continuity Plan for Business Owners
Companies that experience unique challenges, not covered by specific policies already issued, should seek advice from their local governments. Most likely, a lot of businesses will experience disruption during the COVID-19 crisis. To help address these difficult challenges ahead of us, we suggest the following:
Asses financial and operational risk and act quickly. Negotiate your current cost escalations and impact on overall product margins. React quickly, efficiently and find a way to renegotiate new terms during this crisis.
Consider alternative supply chain options. Companies that source parts or materials from suppliers in areas significantly impacted by COVID-19 will want to look for alternatives. American personal computer makers HP and Dell could move up to 30% of their notebook production in China to Southeast Asia, CNBC reported. Apple has asked its major suppliers to assess the cost implications of moving 15% to 30% of its production capacity from China to India, according to an earlier report from the Nikkei.
Determine how will the COVID-19 situation affect your continuity business plan. Where the business is significantly impacted, companies will need to consider minimum operating requirements, including key workforce, vendors, location and technology.
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Based on the outcome of the assessment, companies may need to look at near-term capital raising. In addition, debt refinancing or additional credit support from banks or investors, or policy supports from the government.
Companies that truly navigate through disruption, truly succeed during the crisis. That being said, open communication and transparency with customers are necessary when creating a new business strategy. Besides, people have dramatically shifted toward online shopping and ordering for all types of goods, including for food and product delivery. That being said, companies should invest more in online channels as part of their push for multichannel distribution.
Above all, companies will want to keep customers apprised of any impacts on product or service delivery. Similarly, proactive action will help to mitigate punitive damages or liabilities associated with disrupted customer obligations. In the end, try to revisit your company business plan and see to your supply chain to withstand a minimum of three-month disruption.
Maximize the use of Government Support Policies
Recently the US, UK, and many other developed nations have announced amendments to tax and financing policies. In addition, the government of Croatia recently announced tax and credit postponement. That being said, companies should monitor nation-wide government and organizational opportunities for support.
For instance, the European Commission has approved two German State aid schemes to support the German economy in the context of the Coronavirus outbreak. In addition, the German government announced its plans to provide liquidity to the German economy. Therefore, to manage the effects of the economic impact of the Coronavirus outbreak.
Start with a Continuity Plan Now
Although the COVID-19 crisis was impossible to predict, companies should learn and carry forward once the crisis has passed.
Therefore, companies should be making decisions and taking actions during the crisis with recovery in mind. Above all, when the crisis is over, it will be clear which companies have the resilience and agility to reshape their business strategy to thrive in the future.