ARTICLE 1

On December 31, 2019, the World Health Organization (WHO) learned of

several cases of severe pneumonia in the Chinese city of Wuhan. The
pneumonia, a strain of coronavirus that WHO later named COVID-19, has
since spread through China and into other countries. 

As global leaders and health officials track the strain and make decisions
regarding containment, supply chain leaders need to assess and plan for
how the virus will impact global supply chains. 

The full impact of coronavirus on supply chains might

not become obvious until sometime in the next few
months and beyond
“The consequences of a pandemic event are hard to predict,” says Koray
Köse, Senior Director Analyst, Gartner. “However, the risks always exist
and are augmented with further globalization and integration of supply
chains. It is not a matter of if it will happen but to change the focus to be
prepared when it happens. That is a shift of mindset in risk management
and business continuity.”

Read more: 10 Questions for an HR Pandemic Plan

The challenge of globalization

Although the outbreak is being compared to the 2003 SARS outbreak,
China is now much more developed and integrated with the global
economy, and the country has significantly improved its transportation
networks. This means the supply chain implications go beyond regional
concerns. Travel restrictions, shortages in labor and materials, as well as
logistical challenges through tightened controls, and hub and border
closures will cascade and augment the impact much further today than it
did 17 years ago. Indeed, the coronavirus outbreak has already eclipsed
SARS. 
How coronavirus could impact supply chain 
Though it is difficult to predict the exact consequences of coronavirus,
organizations might begin to see impacts across the supply chain,
including:  

 Materials: Supply shortages of materials or finished goods coming

from or routed through logistical hubs in impacted areas.

 Labor: White- and blue-collar labor may not be available due to

quarantine guidelines or illness. 

 Sourcing: Travel may be restricted to certain areas, limiting the

ability to discover, qualify and certify new business or programs and
to transact business. 

 Logistics: Established hubs and supply networks may experience

limitations in capacity and availability so that even if materials are
available, they would be stuck elsewhere. Finding alternative routes
and means of transportation will become difficult.

 Consumers: Consumers may be more cautious in their purchasing

habits due to fears about being in public and potential exposure to
the virus. Many may turn to online sales, challenging logistics
networks.
Covid-19

Remote Work During COVID-19 and

Beyond
A cross-functional panel of Gartner experts discusses
remote work challenges and best practices.

Attend Webinar

Preparing supply chains for disruption

Disruptions happen. Leading supply chain organizations utilize enhanced
risk management processes. They include a framework to continuously
measure key risk indicators and to prepare scenarios for controllable and
foreseeable uncertainties such as compliance, labor, material, capacity
and financial issues.

Epidemics and pandemics present a different scenario. The main impact is

a lack of access to staff, decreased productivity and a change in public
behavior in terms of shopping practices and spending. “The full impact of
coronavirus on supply chains might not become obvious until sometime in
the next few months and beyond,” Köse says. “However, supply chain
leaders should take initial steps now to monitor and prepare for the
impact on their value chain.”

Short-term actions: Do it now

Develop a high risk for supply chain disruption monitoring and response
programs for countries impacted by the virus and potential supply chain
exposure from tier 1 and below. If lower tier transparency is missing, start
building up the program and prioritize discovery to get a full picture
rapidly. It’s also important to assess how customer spending might be
affected.  

Learn more: Sourcing Strategy for Procurement Leaders

The next step is to make sure all inventory is within reach and outside
impacted areas and logistical hubs. Additionally, supply chain leaders
should work with their legal and HR departments to understand any
financial implications of not being able to deliver supply to customers and
provide guidance to employees located in the impacted areas.

Midterm actions: Do it this quarter

In the midterm, the focus should be on balancing supply and demand as
well as building buffer stock. Assess opportunities to diversify the supplier
ecosystem and review or create the organization’s overall risk
management approach. Work with internal stakeholders and strategic and
critical suppliers to establish a congruent risk management approach to
monitor and prepare for potential material and manufacturing capacity
shortages.

Learn more: Building an Agile Supply Chain

Long-term actions: Do it this year 

Once the initial impacts of the crisis are mitigated, it’s all about foreseeing
the next “when.” Supply chain leaders and their teams can, for example,
conduct a scenario planning exercise and develop action plans. This is the
time to discover or develop alternative sources and diversify value chains.

Tackle strategic and concentrated supplies with high value at risk where
internal risk capacities to absorb, such as alternative sources, routes,
inventory and cash reserves, aren’t sufficient enough to mitigate any
major disruption. Being better prepared than the competition might even
open new opportunities when the next disruption comes around.

ARTICLE 2

Article:

COVID-19 business continuity planning in 5 steps

18 March 2020
Allan Feinberg , Managing Director, Remuneration and Reward Services |
Jenine Waters , Partner, People Advisory
In an unfolding situation like COVID-19, it can feel very much like bracing yourself for battle with
an unknown enemy. Each day the parameters are changing, the borders are closing and the
enemy is drawing nearer.
How your business will emerge at the end of the day, is not only impacted by global legislative,
health, and economic factors, but is also strongly tied to your human response, leadership and
scenario planning in the time you have NOW.
While it is fair to assume you are already deep into your action planning, our objective is to help
you manage a potential COVID-19 crisis successfully by turning this unprecedented situation into
an integrated leadership response.

Building an effective pandemic playbook

So much of your planning success will depend on the ‘human response’, that is, how you treat
your people during this time when they need you the most.
Your actions as a business now will impact your people relationships indefinitely but will also
provide many opportunities to build trust. Consider the possibilities…what if this was the first time
as a leadership team you’d come together, and empowered your HR teams, who are often in the
background, to lead the charge?
Whether it’s COVID-19 or another emerging crisis, there are five key focus areas that should
shape the backbone of your planning process.

1.        Dust off the Business Continuity Plan

Revisit your business continuity plan (BCP) and check to see if you have a response to
something like a virus in there. If not, you need to develop one, starting with defining the rights
and responsibilities of the various stakeholders in this response. For example, what do managers
have to do, what do directors have to do, what do employees have to do? This is critical to the
framework of the response and managing risk going forward.
Next, set up a BCP team by establishing a core group that represents all functions and
departments across your organisation. This group should meet daily to achieve two key priorities:

 Facilitate two-way information sharing; and

 Undertake scenario planning and workshop of solutions to respond as things change

Note, where a business is unionised, you would include a union member on that BCP team.

2.        Scenario Planning
Imagine if this crisis gave you permission to change your approach, to create trust in your
leadership team and overall to emerge as a better organisation.
Run in parallel to stage one, engage your finance people in scenario planning around the
economic impact on the organisation, the cost implications (organisational and customer-centric),
and opportunity identification. Considerations in this phase might include: renegotiation of
contracts, creating ‘peace of mind’ communications, and allocating additional resources in areas
that need them most.

3.        Human Planning
This phase is focused on the protective measures, communication of the plan, and new pay and
working arrangements. Considerations in this implementation phase might include: monitoring
and management of rapidly changing health advice, flexible or remote working arrangements,
travel bans, leave entitlements and changes to pay, or impacts on bonus schemes and share
plans.
Planning should not only cover policies and legislation but also consider support mechanisms for
the psychological health and wellbeing of team members.
In establishing the overall remuneration impact, all initiatives implemented should be tested by
your BPC team during scenario planning. Data is key to supporting decision making here.
4.        IT Structures and Controls
Creating an IT plan now is critical. Your information systems teams will play a crucial role in
facilitating remote workability and ensuring core systems have the necessary controls in place to
support this style of work.
What you should expect in these challenging times, is the infiltration of the virus not only in reality
but also virtually in the form of phishing emails and cyber-attacks on systems. Hackers in parts of
the world not yet impacted by COVID-19 know you are in a weakened position and are very
active. Emails disguised and headed by trusted sources will become prevalent, e.g., ‘click here
for the latest update on Coronavirus from the Department of Health.”

5.        Uncovering the Opportunities

Opportunity planning is very specific to industry and is all about the legacy you want to leave as
an employer and member of the business community. Using this crisis to gain employee trust is
your first massive opportunity, but there will be others specific to your industry that you could
take advantage of.
Considerations in this phase might include: What can be done online? Can we move planned
maintenance activities forward that were going to be done later? How can we supply the BCP
team with really good information and good scenarios that they can work through?
Every business will have opportunities, not only in people management but also in timing and
infrastructure.

You don’t know what you don’t know yet – but

collectively we have a knowledge network
As you go through the planning process, you don’t know what you don’t know yet, but following
these simple steps will help you overcome the gaps and provide certainty on where to focus your
attention in a COVID-19 response.
Understand that we all feel vulnerable during times of uncertainty and that there will be positives
that flow from this crisis.
BDO Australia has instigated a national COVID-19 management survey to help businesses enact
rapid risk management plans to secure the safety of people, mitigate financial impacts and
manage supply chain disruptions. These results will help industries benchmark leading HR
actions against peer groups and will be available later this week.
This initiative is just one aspect of our crisis response offering. To find out more about how we
are connecting industry with valuable knowledge and COVID-19 remuneration and culture
response planning, please reach out.
 

ARTICLE 3

Critical human capital dimensions of a business continuity plan