COVID-19 and Business Continuity Planning
The coronavirus outbreak is a stark reminder that we live in a world where seemingly anything can go wrong at a moment’s notice. CEOs and their teams must plan like never before.
What to Know and Why It Matters
Outsell meets regularly with CEOs, MDs, COOs, and presidents through one of our flagship solutions that marries P2P community with Outsell research. We focus on benchmarks and operating practices while providing a safe and productive place for leaders to compare notes about issues they have in common. Leaders solve problems, learn, connect, and partner. We began this offering with its regular meetings three times a year back in 2004. We launched UK groups in 2007, and we now have about 150 C-suite executives meet face to face in February, June, and October.
Rarely, if ever, can Outsell recall the topic of disaster preparedness coming up in all these meetings — until our most recent round. The topic has been starting to get more attention recently, and that was before COVID-19.
The critical issues of the day are those that we can no longer anticipate. It used to be that our biggest problems were digital transformation or finding and keeping the best talent. Now our biggest issues are coming from the unexpected. For the first time in Outsell’s history, we are hearing routine dialogue about readiness.
Leaders are facing unprecedented disruption, not just from competition but seemingly from just about everywhere. It’s all about the events we don’t see coming:
- Terrorism that has not only led to catastrophic loss of life but taken out entire companies and hobbled many more.
- Ransomware attacks — we recently had a client whose company was held hostage.
- Employees leaving back doors open that allow bad actors to infiltrate our systems and steal our data, either by accident or as a result of “going rogue.”
- Customers or employees who don’t like a particular stance on a topic and take to social media inside or outside the company to blast reputation, suddenly creating PR and other nightmares.
- Weather disasters. One CEO we spoke with had to deal with two employees losing their homes — one from a fire in California and one from a hurricane on the US east coast.
- Loss of power, such as when utility companies decide to take down power grids, affecting internet access and cell phone communication.
- The unexpected deaths of employees due to accident, catastrophic health failure, or other causes.
- The sudden passing of a business partner or co-founder who runs parts of an organization that the other co-founder is ill-equipped to run. Two people can be perfect complements in running a firm, but segregation of responsibilities can prove disastrous when succession planning isn’t in place. This also raises related questions about unexpected partnerships when inheritors become business partners and the topic had never been discussed before.
And now, add to all this the possibility of a pandemic. Outsell sees a cascade effect on our industry serving end markets depending on how far and how fast COVID-19 spreads and how long it lasts. Already there is scuttle about the technology and pharmaceutical supply chain, the travel, airline, and cruise industries have been hit hard, and speculation about the price of oil due to slowing demand portends problems. Closer to home, exhibitions have been canceled, and we know of companies whose workers in Italy and China have been sent home.
What’s a leader to do?
Essential Actions
None of us can forecast the future with accuracy, and it’s hard to be a leader in an era where the new normal is the prospect of chaos. Most of the leaders we know are optimists and believe in what’s possible, right, and good. It is their view of human potential, prosperity, and what’s possible that makes them great, so it’s not in their nature to go around harrumphing about what can go wrong. However, in this day and age, we have no choice — it’s essential to plan for the unexpected. We’ve seen, heard, and recommend the following actions:
- Review the list of risks above, determine what else could go wrong, and spend time taking an inventory about the worst. It’s painful, but it’s essential to go there.
- Convene the executive team and have an honest conversation about scenarios. What’s the worst that could happen?
- Determine who is on point to lead the response. What are the possible and plausible activities that would need to happen?
- Review the scenarios and run a playbook.
- Set up distributed decision-making so that if the point person is affected, someone else is on tap to lead. Build-in redundancies and have open discussions about where there are possible lapses, like succession planning for key hires. Solve for the gaps.
- Build and review plans and then dry run.
- Review the findings and plans with the board and, where appropriate, bring suppliers and partners into the discussion.
- Inform the organization and make sure it is nimble enough to respond.
Have open conversations. Who likes to talk about what happens if someone dies or a pandemic strikes? It’s uncomfortable, but if we don’t dig into the dangers to have the hard conversations, we’ll hinder our responsiveness, something no leader can let happen today. We are pleased that this topic is finally on leaders’ minds and that they are talking about it in our meetings with us and with their teams. Few really want to go there, but we simply must.
One company we know ran trials after Hurricane Sandy of having all team members work at home in two-week sprints. We hope they won’t face shutdowns due to COVID-19, but if it happens, they will be prepared. And at the end of the day, that’s the best anyone can do.
At one of our member meals a few years ago, we heard two European leaders postulate that the era after World War II up to 2001 and through to the Great Recession was actually a period of abnormality — its relative calm was the aberration. They speculated that the “new normal” was actually “back to normal” and that living in disruption was how the world mostly operates. We are not sure we have the answer to that thought, but it rang true enough to remember it years later. In a world where the only constant is constant change, we simply must do our best to prepare and then have the grace to accept that some things are ultimately beyond our control.