From our experience, a strongly developed crisis response capability is required to ensure the efficient management of incidents in order to minimise associated negative impacts, meet government priorities around maintenance and confidence, and to ensure the continued delivery of critical national infrastructure. Many organisations have these plans in place for the workplace and supply chain but COVID-19 has already unveiled flaws in some. Given the unknown variables surrounding the outbreak, it is important to review crisis and business continuity plans, develop different scenarios and put them to the test.
Whilst the priority remains human welfare, we are hearing about other employee challenges. Examples include establishing the tax position of people who are moving between countries on an emergency basis, through to companies having to plan on putting production lines on pause due to supply chain issues, with the associated potential impact of asking employees to temporarily stop work.
Ever since the COVID-19 outbreak was declared a pandemic by the World Health Organization (WHO), there have been widespread concerns about the continuity of business operations worldwide. Knowing about the current technology and security limitations of the current work environment and planning for future remote working needs can help an organisation ensure business continuity and minimise disruption.
Where clients are reliant on supply chains in affected areas, rapidly depleting stock levels are becoming a significant risk and clients are working through strategies for alternative sourcing. In certain cases, clients are showing signs of distress and stakeholders (e.g. lenders) are concerned about the future viability of the business. We are discussing different potential scenarios and what these mean for their operations, for example, as cases of viral transmission emerge in different territories.
Financial and Liquidity Risk
At present, the extent of the COVID-19 outbreak and by when it will be brought under control remains unknown. But it is certain is that businesses worldwide will need to consider the impact of reduced economic activities and lockdowns on their financial health and stability. Responding to an economic slowdown requires sensitive management of finances, balancing the short-term requirements with the long-term plans by organisations.