Leading and managing businesses through the three phases of the COVID-19 crisis

Businesses and institutions are facing uphill challenges as the current global health crisis turns life upside down with broken supply chains, fractured manufacturing, workforce disruption, financial strain, and loss of business. For many, the future remains more uncertain than ever before. Based on our experience working for some of the leading companies and governments in the world, we have asked our specialists at Capgemini to share their take on how we can help you and your organization to respond and build resiliency during this time of uncertainty.

Economies are facing an unprecedented economic shock. What makes this so difficult to manage is that it is both all-encompassing and non-specific. For years most businesses have performed very well, yet we are now facing unprecedented challenges in the supply chain, demand, security, people management, and liquidity. National economies are better off now than they were a decade ago, yet nations are struggling with a situation in their labor markets and their ability to deliver frontline services. Most companies are understandably feeling their way towards understanding, reacting to, and learning lessons with twists and turns daily.

Yet, given the very different levels of maturity in how companies have prepared themselves (Digital), the road ahead will still be challenged by the “new normal”. Hence, we propose a pragmatic fit for future approach to navigate towards scalable digital excellence and business resilience. Responding to unfolding events, communicating, extracting, and applying learnings in three phases: Respond, Restore, Relaunch.

Traditional crisis-response approaches will not be sufficient, and companies need to deploy immediate crisis-response strategies and ensure business continuity, productivity and efficient collaboration, and high security.

KEY CHALLENGES AND WHAT CAPGEMINI RECOMMENDS

Assure Continuity – Fast Track Remote Work and Collaboration

Employees all over the world are being forced to work from home before they have the infrastructure in place and the culture to work in the new working environment.

Capgemini recommends that you

• Assess the current virtual work environment and highlight opportunities to implement best practices
• Conduct a review of the infrastructure to understand if your company’s infrastructure can withstand the new ways of working

Stay Secure – Asses, Focus and Increase Cybersecurity Measures 

The number of cyber attacks is drastically increasing during the current crisis. With more than millions of employees requested to stay home and work remotely, companies are much more vulnerable to cyber attacks as their exposure has grown.

Capgemini Recommends that you

• Assess your employee tool kit and systems for vulnerabilities
• Focus on identity. Review roles and access rights
• Increase monitoring of your security state and create, or review, your crisis plans and lines of communication

Rapid Cost Take-Out – Assess, Stop and Reduce

In the current economic climate, companies need to prepare and drive cost down which will give funding to new initiatives.

Capgemini recommends that you

• Conduct a cost transparency assessments and identify opportunities for cost reduction along major service towers
• Implement cost reduction with immediate effect, e.g., re-evaluate and cut project portfolio, consolidate 3rd party suppliers and outsourcing on a small (department) scale

While we don’t know what the full effects of the current situation will be, we can expect that once government aid packages begin to disappear, businesses will need to take a hard look at the facts to prepare for a new economic reality. Solutions that ensure cost focus, continuity, and cater to the shifting consumer behavior will be vital.

KEY CHALLENGES AND WHAT CAPGEMINI RECOMMENDS

Ensure Supply Chain Continuity

Many suppliers may be disrupted and will be unable to fulfill their commitment in both the short and long term. Understanding the actual risks linked to the whole supplier’s base will be critical for companies.

To ensure supply chain continuity, as well as, manage and minimize supplier risk Capgemini recommends that you

• Conduct and of current tier 1-3 suppliers and benchmark to understand vulnerabilities
• Analyze demand at the SKU-level and adjust
• Implement a supply chain risk mitigation plan to ensure stability in the months after the peak of the crisis

Follow Shifting Consumer Behavior Towards eCommerce Boost

The worldwide lock down will likely trigger unforeseen new buying behaviors – including a permanent switch between digital and physical channels. Companies needs to adjust sales channels to these new behaviors.

Capgemini recommends that you

• Rapidly establish online sales channels together with needed sales and payment platforms adjusted for target audience
• Transform current eCommerce sites and ensuring efficient design and sales flow optimized for all operating systems and devices

Reduce Cost Base for Medium to Long-Term

Companies need to adopt a mindset which drives efficiency and optimization in both medium- and long-term to mitigate any potential black swan.

Following a cost take-out assessment Capgemini recommends that you

• Drive operational efficiency through Intelligent Automation
• Transition and transform IT functions through IT buyout, reducing not only cost but also risk
• Optimize outsourcing setup and find the right combination of near- and offshore

Beyond immediate actions, organizations should think more medium to long-term and use this as an opportunity to reflect on the ability to navigate a crisis and in looking ahead to start shaping the strategic responses to a changing world (“new normal”).

The Relaunch phase is split up into two sub-phases – RETHINK, which is the medium-term and REBOUND, which is the long-term.

Feel free to reach out to our experts to learn more.

Ensure Supply Chain Continuity Claus Rydkjær Managing Director	Cost Takeout & Sourcing Faisal Ramzan Director of  Management Consulting	Shifting Consumer Trends –eCommerce Boost Thomas Neergaard Head of Digital Customer Experience