When the coronavirus first arrived in the U.S., no one knew just how big an impact it will have on the economy. It brought the travel and tourism industry to a standstill, with local and international flights and accommodations having to be canceled to stop the spread of the virus. According to U.S. Travel Association president and CEO Roger Dow, “The impact on travel is six or seven times greater than the 9/11 attacks.”
Apart from that, businesses across the country had to quickly pivot and bring their work home. A lot of companies had to suspend or completely lay off their staff, resulting in 6.6 million weekly jobless claims at the end of March and 20 consecutive weeks of having more than 1 million weekly jobless claims.
While businesses today have more or less adjusted to the new normal, the initial panic and confusion that reverberated across industries showed just how unprepared businesses are for disruptions as big as the current pandemic. So, what if it happens again?
Below, we share a few ideas on how businesses can prepare themselves if a new pandemic spreads across the world once more.
1. Reevaluate your business continuity plan
A business continuity plan is essential for companies to continue operating with as little disruption and damage as possible in case of potential disasters, such as typhoons or security threats. But most business continuity plans probably don’t have any sections dedicated to worldwide pandemics that can result in months of working from home or half the staff coming down with a virus. This is exactly why you should reevaluate your business continuity plan and include measures, such as having an enterprise risk management system, in case scenarios that recently occurred happen again.
2. Modify the force majeure clause in your contracts
No one really expects something as big as the current pandemic will happen when drafting and negotiating contracts with suppliers and vendors. So, oftentimes, the force majeure clause in contracts is only there for show. But, as evidenced by the past few months, unforeseeable circumstances do happen and you need to follow what’s on your contract. Moving forward, it’s best to negotiate having epidemics and pandemics in the force majeure clause of your contract with suppliers so you’re allowed to suspend or terminate your obligations with them without being held liable.
3. Identify alternative supply chains
China plays a major role in the supply chain of businesses all over the world. So, when the country closed its borders to foreign nationals in March, albeit temporarily, supply chains were disrupted, causing more trouble for businesses that are already under too much pressure. To prevent this in the future, consider alternative production sites of your products, such as ones that are within the country.
4. Educate your employees
Employees often get the brunt of it when companies are unprepared for disasters. Either they get laid off or they’re left confused as to how to proceed with their jobs. Make sure they’re protected by educating them on your business continuity procedures and what they can expect in case the company is impacted.
Don’t wait for another pandemic before preparing your business for these situations. Act now so you can polish your system and ensure your organization survives to see the future.
