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Seven ways to build resilience to future crises

Here are seven lessons you can learn today to strengthen your firm’s resilience in the face of future emergencies

Learn the lessons of COVID-19 and whether the next disaster is climate change, earthquake, economic slump or another devastating virus, you’ll be ready to handle it, says Thomas A Lawson, president of $5.6bn mutual insurance company FM Global. Writing for Chief Executive, he identifies seven lessons that will boost your risk management and planning skills for the next crisis.

  1. Consider your supply chains. Geography plays a big part in your company’s capacity for survival when facing a serious global issue like COVID-19. If your chain involves suppliers, facilities or key markets in countries or regions that have shown less resilience during the pandemic, look for alternatives as part of your recovery strategy. Having a strong back-up plan is crucial.
  2. Invest in risk prevention. Examine your organisation thoroughly, establishing where your profit comes from, how vulnerable those areas are, and how you can best protect them. Don’t be in denial about the possibility of another sudden catastrophe. Address the weak areas in your business and you could avoid the pain of unnecessary losses in the future.
  3. Know when to shut down. No leader wants to halt production, but you need to know that leaving it too late can have an even more costly and destructive outcome. Employ a decision tree graph to help you establish the right time to close operations before any threat becomes an overwhelming reality, making huge losses inevitable.
  4. Guard your empty buildings. When properties are unoccupied – particularly with your teams working from home – they become targets for thieves and vandals. Make sure your operations team remains active, checking all your premises for damage or illegal activity and taking the opportunity to carry out essential maintenance work.
  5. Resume operations cautiously. COVID-19 brings particularly tricky issues for the restart including social distancing rules and the possible need for reduced staffing. But any relaunch phase is prone to errors and false starts. “The classic case is maintenance equipment left in pipes, vessels, and machines – or improper reassembly after inspection.” Stock and supply are also key elements to check carefully before jumping in.
  6. Make and follow a firm plan. Have your risk team coordinate and record business continuity and worst-case scenario proposals for your whole organisation. “Spell out ahead of time procedures for emergency response, evacuation, business recovery, IT recovery, crisis communications and supply chain continuity.”
  7. Establish a survival team. Put the continuity of your business in capable hands – and include yourself in a dedicated team. Make sure everyone is well prepared to guide the organisation if, and when, disaster strikes again by testing out strategies and adjusting the plan accordingly.

We didn’t see the devastation of COVID-19 coming, but your experience of dealing with it could put you and your organisation on a strong footing for the future if you choose to accept and act on its lessons.

Source Article: Critical Lessons CEOs Are Learning In The Crisis
Author(s): Thomas A Lawson
Publisher: Chief Executive