CEO Bill Nelson on Looking Beyond the Pandemic

Mark Orsi and I have both monitored and written on the COVID-19 outbreak as it has spread from China to Japan and South Korea, and on to Iran, Italy and then throughout the world.

When we last posted on February 26, there were 57 cases in the U.S. Most were confined to the west coast and could be attributed to evacuees. There had been no community spread.

In the two weeks that have followed, the World Health Organization now considers the COVID-19 virus a pandemic. In the U.S., that number has grown to 1,050 cases as of March 11, with community spread throughout the country..

The corporate and individual response to the pandemic has also escalated. I applaud RSA for being transparent with their recent announcement that two attendees at their recent RSA Conference in San Francisco have contracted the virus. 

On a personal note, I spoke at the RSA Conference and met with many people during the three days that I was there. However, I practiced social distancing during my entire time at the event, washed my hands frequently and made use of the ample supply of hand sanitizers provided throughout the venue. I did receive many surprised looks when I refused handshakes by instead sticking out my arm for an elbow bump. However, no one complained. I think it is imperative that we all take this pandemic threat seriously. 

Many companies have halted foreign travel and even curtailed domestic flights. The NCAA just announced that spectators will be banned from the upcoming "March Madness" men's and women's basketball tournaments except for families of the players. Industry appears to be taking appropriate actions that will help protect the public and aid in continuity of operations.

There are still remaining questions about supply chain impacts of the COVID-19 pandemic. McKinsey & Company issued a report that outlines supply chain actions businesses can take, spanning the immediate and the mid-term, to help analyze their situation (see slide 16 in the link). The key areas are:

1.      Understand exposure

2.      Take action to address anticipated shortages

3.      Ensure resources required to restart

4.      Understand additional options

5.      Continuously improve material supply stability

6.      Kick off designing resilience supply chain for the future

7.      Build collaborative relationships with external partners

The CDC also offers a checklist on pandemic impacts to business, as well as a checklist with a broader view meant for organizations with overseas operations. There is some overlap with what McKinsey outlines, but the CDC is more focused on employee practices. For organizations in need of a comprehensive response plan, FEMA offers a continuity of operations template.  

Long term, once we have moved past containment and into mitigation, and ultimately solve or weather this crisis, what will be the takeaways for the private sector in facing supply chain issues? One clear answer is the need for more companies to arm themselves with a pandemic plan that takes into account how they can firm up their respective supply chains in this global interdependent economy.

Many businesses operate in model where products or services are provided to consumers through various facilities. These facilities are all susceptible to physical and cyber threats such as cyberattacks, earthquakes, or internet outages. Crisis plans prepare for those threats by developing business continuity solutions like power, data or internet redundancies. But what is now apparent is that there needs to be more flexibility in logistics and diversity in sourcing, not just where data or goods are at rest.

In the future, if supplies become unavailable a business may be slowed but it should not be stopped. There must be alternative sources for supplies just as there are alternative sources for data, power etc. While production alternatives may not be quite as cheap or fast, they’re cheaper and faster than the alternative- shortages and complete stoppages.

Sustainability needs to be prioritized in the same manner as streamlining of costs.

Originally published on LinkedIn.