While there are many scenarios that modern enterprises prepare for, from economic hardship to legal disputes and agressive competition, a few remain impossible to anticipate. In such circumstances, from natural disasters to viral outbreaks and economical crises, it’s not just your company that gets affected. It’s the entire business ecosystem, and, at times, even the economy itself. And the worst part? These events cannot be avoided, only mitigated.
In fact, according to a recent Deloitte Risk Management Survey, 96% percent of CEOs foresaw serious disruptions in their companies’ immediate growth. The situation was not significantly better at an IT and infrastructure level, a survey by Virtualization Review and Datrium showing that no less than 89.6% of IT leaders considered disaster response a vital capability. Given the recent escalation of the Covid-19 outbreak and the measures that followed, we’ve compiled a few pieces of advice that will help you protect your company, while also keeping your cashflow afloat.
While it seems essential to have a contingency plan, the recent emergency situation has shown that multiple companies lack such strategies. In fact, a local survey showed the percentage of unprepared companies to be as high as 70%.
Establishing a risk management strategy, even as the crisis unfolds, is prioritary. In case of small and medium enterprises, getting the main stakeholders together for a risk meeting might be enough. Larger enterprises would have to use a risk governance model such as the Three Lines of Defense system or a more general risk assessment system.Regardless of the situation, the plan would have to analyze risks, vulnerabilities, and costs, as well as the impact on the working capacity. Finally a risk management strategy should also set realistic expectations for both internal and external stakeholders.
In times of crisis, human capital becomes difficult to manage, as people will not only suffer from anxiety, but also fear for their jobs. Keeping your employees safe is vital, followed by an honest assessment of their roles and how they can fulfill them.
Is their physical presence vital to the continuity of your business? Is their current job essential or can they be temporarily reassigned to auxiliary processes? Can they work remotely? The answers to these questions are important not only from a human and a business standpoint but also since, after major crises, the job market fluctuates severely. Your employees are your biggest asset!
After your employees, your company’s next critical asset is your data and your clients’ data. Is this data available just in physical form or do you also have digital backups? Are your documents stored securely and compliantly, or are they just stuffed in different file cabinets and cardboard folders, or spread across multiple computers? This is why digitalizing your paper documents is always a good step (before the crisis, preferably), and so is having an electronic archive in place at any time. However, before choosing a supplier for any type of such a SaaS or cloud-based service, you should check out our guide regarding security.
It’s important that your provider respects some basic security and privacy rules, or has the ability to implement more advanced ones, such as disaster back-up, encryption, and data residency. If you’re constantly exchanging sensitive data, extra internal security measures should be used. Our guide on invoice security can show you some of the risks of openly trading legal documents, but also offer you some tips on keeping documents secure.
Closely connected to safeguarding your data, eliminating paperwork is not just a good crisis prevention strategy. It’s an essential step towards digitalization and something that can be easily achieved through OCR and EDI technologies.
Paper documents, from internal contracts to supplier invoices, have two major disadvantages that can put your company at risk. The first is that they require human presence to be created, completed, and signed. The second is that they require multiple human contacts in order to be safely transported to their destination. This is why touchless processing should be a priority for risk managers, but also for those working in operations: managing your employees remotely is nearly impossible if they depend on physical documents and folders!
To better protect your employees and your business, you should make sure critical processes that can function without human intervention are automated. While task automation can help, it’s business process automation that can really make a difference. For example, a lot of paperwork and manual labor can be reduced by using an electronic invoicing or a P2P automation solution. All the contract renegotiation that most certainly occurs during unforseen events can be done in a touchless matter, with a contract management solution.
While it may seem that these solutions only work in financial, purchasing, or accounting departments, the truth is that, with them, even supply chain and logistics companies can reduce their number of employees in the field. Since we are a business ecosystem automation company, we won’t insist too much on these measures and leave them to your choice. However, we can provide a guide to help you make the right decision.
Open communication is the key to any successful risk management strategy. Therefore, if you can keep your service running to a certain degree, don’t forget to inform your clients in time. You can even offer certain discounts or perks to those that need them more – events beyond anticipation can lead to loyalty above expectations. As for your commercial partners, assure them that once the emergency is over, your relationship will return to business as usual. It is highly likely that their companies are also under duress.
And, last but not least, prepare for the market comeback. While many international crises lead to short periods of economic depression, they also lead to new and unexpected opportunities. Have your team prepare a comeback strategy when the economy starts recovering. Meanwhile, keep your employees safe, your documents secure, and your hopes up!