BCDR Best practices: Business continuity plans in the time of coronavirus

Told through the story of one organization

When the first questions came through asking about our business continuity measures in the wake of the coronavirus outbreak, it had not yet been declared the COVID-19 pandemic. That announcement came almost exactly one week later.

Within that short timespan, we had numerous customers share examples of their COVID-19 coronavirus pandemic business continuity plans.

For some, the plans have been relatively straightforward and resemble our own – keep our employees healthy and safe by working remotely away from groups of people. These examples have mostly been limited to professional services, consulting and technology companies, the businesses that have an ability to quickly change positions of their workforce depending on the climate.

For others, their COVID-19 coronavirus pandemic business continuity plans are complex with hundreds of contingencies and variables, like their ability to trade on the markets, source supplies from vendors overseas, transport finished goods, staff retail locations, or educate young bright minds of the future. These plans have been rigorous, thorough and evolving as new information is published by government officials and new findings come back from their own organization and its partners.

Moral of the story: Business continuity plans provide structure but must remain fluid enough to adapt.

We aggregated the business continuity conversations shared in the wake of the COVID-19 coronavirus pandemic to provide a fictional story summarizing the best practices in activation today. The story begins with ‘Emilies Fancy Farma,’ a manufacturer of generic antivirals and a growing challenger in the pharmaceutical space.

Background

Emilies Fancy Farma customers are predominately located in the United States, but their sourcing and manufacturing primarily occurs in mainland China. In recent years, the pharmaceutical industry became hypervigilant in quality control after a few bad apples mismanaged drug packaging in shipments to customers, and even worse, some vendors had been caught using incorrect formula doses during manufacturing to cut costs.

As a result of these industry-wide experiences, Emilies Fancy Farma now maintains some of the most rigorous vendor selection and quality assurance processes in the industry. They have set the standard for best-in-class policies to ensure quality throughout their sourcing, manufacturing, packaging, and shipping processes.

The Event

Enter coronavirus 1.0 – shutting down all of China the same time as Chinese New Year.

With so much of their supply chain located in China, Emilies Fancy Farma had already planned for the production slowdown that occurs annually during Chinese New Year. What they weren’t ready for was a continued halt of all movement in China for weeks on end.

Fortunately, all current sales orders could be filled with current product stock and some future sales orders could be filled with reserves. Weeks passed with no changes – production facilities were still halted and employees were still in lockdown – so Emilies Fancy Farma began strategizing.

Considerations Discussed

  • Should we limit new sales until they could resolve the supply chain and production capacity issues? (Revenue impacting)
  • Can we find alternate vendors or manufacturing centers in other countries in a short timeframe? (Quality control and investment risks)
  • Could we just wait this out until the situation progresses and more information comes to light? (Board Members are constantly requesting updates)

Doing nothing would cost them more than just financially, so business continuity planning went into full gear to assess their situation and determine the best strategy for moving forward. Action plans went into place.

The Process

  • Step 1

    Appoint a leader to manage the overall strategy and plan

    Emilies Fancy Farma selected a business analyst with experience auditing BC/DR plans at a previous company. She built a taskforce of individuals from several departments to ensure holistic business planning.

  • Step 2

    Assess your assets & prioritize

    Three primary concerns identified by Emilies Fancy Farma:
    1) Active ingredients: without them, they had no ability to produce a product,
    2) Manufacturing centers: the only means to mix drug formulas, and
    3) Distribution: finished product had to get to customers.

    Step 2

  • Step 3

    Collect data to inform your activation plan

    Surveys went to sourcing vendors and manufacturers. Questions ranged from supply quantities, to timelines, to staffing plans, to status of ocean line cargo fleets. Each question had a prioritization ranking, so as results came back, Emilies Fancy Farma could see where they should focus their mitigation plans.

  • Step 4

    Activate the BC/DR plan

    Employees throughout Emilies Fancy Farma received notifications with information on the situation and specific actions required of their role, along with assigned due dates.

    Step 4

  • Step 5

    Monitor, report & focus

    Reports on supply chain disruptions, financial impacts and mitigation efforts were sent to the board  weekly during the first two weeks of the outbreak. As the situation heightened with coronoavirus 2.0: global pandemic, reporting shifted to daily for board members, while more detailed reports went to exec.

  • Step 6

    Adjust, adjust, adjust

    ‘High-risk’ zones were set up for suppliers who fell below specific delivery commitment thresholds, enacting focus on alternative sourcing plans. Week by week, new alternative plans shifted to different areas of the business based on new information.

    Step 6

Implications for Your Business

As the COVID-19 coronavirus pandemic disrupts everyday life, your ability to shift with each new challenge becomes paramount.

Consider how some – or all – of these examples could be put into motion in your own organization to improve your business continuity plans. What could you accomplish? Where could you improve? How can you rebound faster?

Reach out to us if you have questions on how your business is going about continuity planning or how you can create efficiencies in your initiatives with this example shared.