How resilient is your

enterprise?
Assessing your readiness to deal with a
global pandemic
How prepared are you to respond to COVID-19?
What are some of the major issues?
Challenges
• The rapidly developing COVID-19 outbreak poses health risks to
your employees, as well as financial and operational risks to your
company and stakeholders.
• While this is first and foremost a humanitarian challenge, it will
likely also test your company’s overall resiliency.
Uncertainty
• The overall medical situation is fluid, changing almost daily and
across geographies.
• There are mixed signals in the marketplace — both relative to the
spread and control of COVID-19, and to the responses in financial
marketplaces around the world.
Complexity
• The global spread of COVID-19 adds yet another layer to the
current complexity crisis facing business leaders.
• This outbreak is only the latest in an increasing number of
unexpected disruptions that are impacting business performance
— and it won’t be the last.
Page 2
What should companies be doing?
While it may be too early to fully understand the severity of this crisis and its long-term
implications, there are several areas where business leaders need
to focus in the short term. Some of the key focus areas include:
• Employees – focusing on their overall health and well-being
• Customers – considering customer safety and protecting your brand
• Suppliers and vendors – maintaining your supply chain and global trade
• Stakeholder communications – communicating with your employees and
key stakeholders, including your board and investors
• Government and public policy – staying on top of developments in the relevant
geographies where you operate
• Risk, technology and information security – focusing on strategic and operational
risks to your business, from hackers to business continuity
• Insurance and financial recovery – planning now to expedite financial recovery
through insurance claims and other means
Each of these areas is covered in more detail in
our Enterprise Resiliency framework.
The resilient enterprise: leading through uncertainty and complexity

• Supply chain (SC) resilience

1 2 • Promoting employee safety & well-being
Employee • Public health Information (CDC, WHO)
• Third-party service providers Supply chain and
global health and • Support for impacted employees
trade well-being
9 3
• Business interruption • Employee relations
Insurance & Talent and
• Supply chain claims • Talent initiatives
• Event cancellation
financial
recovery
g workforce
• Business traveler

8 4
Leadership and Customer
• Infrastructure framework Technology • Safety-based customer experience
and communication safety and
• Cyber resilience • Direct to consumer and e-retail
information brand
• Digital customer channels protection • Packaging and delivery innovation
security
• Disruption

7 5
• Tax strategies
• Regulatory/disclosures
Government Financial • Investor trust
• Geopolitical and country risks
and public and • Liquidity, credit and capital
• Regulatory changes
• Leadership and public policy
policy 6 investor

engagement • Enterprise risk planning

Risk • Risk identification
• Scenario planning
• Continuity and recovery
• Response and monitoring
Page 3
 Supply chain and 1. Supply chain and global trade
global trade

Potential impacts
Ideas and insights
• Shutdowns or unavailability of materials, which could cripple operations
• Take immediate actions across six supply
• Loss of potential revenue for some but upside for others as demand chain dimensions (see Appendices for
increases for certain goods and services more information)
• Labor constraints and shortages that impact operations and customer • Establish real-time supply chain risk
intelligence monitoring systems
satisfaction
• Strengthen sales and distribution channels
• Traditional customer sales channels upended for stay-at-home customers
• Lead time changes and uncertainty, leading to stock-outs • Repurpose your employees, locations and
assets to support
e-commerce
• Deploy leading-edge technologies to
rapidly model and predict supply impacts
Assessing your current state 1 2 3 4 5 and minimize the costs of disruptions
1.1. Are you proactively monitoring disruption triggers, • Consider war game supply crisis scenarios,
such as social unrest, natural disasters, cyber attacks, and identify gaps and develop business
labor disputes and so on? case for investment interventions
1.2 Do you have visibility into your first-, second- and • Develop alternative bills of materials —
third-tier supplier health and capacity? critical component alternatives
1.3 Do you have the ability to quickly respond to supplier • Enact alternative supplier sourcing
or vendor disruptions? Are you prepared to ramp up strategies
alternative suppliers?
1.4 If consumers stay home, is your e-commerce model
strong enough to maintain sales?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
Page 4 development/review; 4 = Being partially addressed; 5 = Being fully addressed.
 Employee 2. Employee health and well-being
health and
well-being

Potential impacts
• Provide a safe workplace and offer employees the support they need, as Ideas and insights
the safety of people should be the overall priority • Reassess your internal
communication strategy and channels
• Minimize disruptions to operations by establishing pandemic-specific to reach employees and other
policies and procedures around employee communications, stakeholders
telecommuting and personal/family leave • Provide education and information
that offer insights on key topics, such
as understanding of pandemic illness;
insight on transmission patterns; early
Assessing your current state 1 2 3 4 5 detection, diagnosis and treatment;
and what to do if infection is
2.1 Have you provided access to internal and external suspected
resources (e.g., WHO, ISOS, CDC) to raise awareness?

2.2 Are you providing timely updates through internal

communications to employees to educate and inform?
2.3 Have you established guidance to protect the health
and well-being of personnel by containing and protecting
against the spread of the illness?
2.4 Have you created an empathetic digital
communication strategy to support employees and
families impacted by the illness?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 5
 Talent and
3. Talent and workforce
workforce

Potential impacts Ideas and insights

• Impact to operations if large employee population becomes ill • Review the current controls and
• Increased health care costs and loss of productivity due to absences, travel related documentation for relevant
restrictions and mandatory quarantines HR and legal processes
• Develop new policies and procedures
• Legal issues due to unsafe working environment to effectively cope with employee
• Limitations to onboarding due to travel restrictions health and travel risks caused by a
global pandemic
• Potential lawsuits and brand damage in the case of preventable employee
• Assess globally mobile employees,
deaths
business travelers and assignees

Assessing your current state 1 2 3 4 5

3.1 Have you implemented the right precautions in your
facilities to prevent the spread of the virus?
3.2 Do you have a means for employees to report health
concerns?
3.3 Do you have a strategy for modified business travel to
minimize impact?
3.4 Have you addressed the legal and health risks of your
employees, including your contingent workforce?
3.5 Have you prepared for immigration-related measures
being put in place?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 6
 Customer
Customer
safety and
4. Customer safety and brand protection
Safety/
brand
Brand
protection

Potential impacts Ideas and insights

• Declining store sales and temporary closings of storefronts • Leverage social media to dynamically
• Reduction in merchandise due to supply chain disruptions develop, test and refine your
pandemic-relevant brand messaging
• Increased demand for safety/sterile packaging for certain product
• Use agile product and packaging
categories innovation to mitigate health threats
• Need for optimal everyday and promotional pricing tactics, taking into and provide greater consumer
consideration changes in demand and consumer elasticities confidence
• Review downside forecast estimates
and look for ways to mitigate the
highest potential pandemic-related
Assessing your current state 1 2 3 4 5 downside drivers
4.1 Have you implemented a communications campaign to
address the impacts of the pandemic?
4.2 Have you taken action to improve sterile packaging?

4.3 What actions have you taken regarding relevant safety

issues, such as food safety?
4.4 What precautions have you taken so that your
e-commerce capabilities are ready for pandemic-driven
demand surges?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 7
 Financial and
5. Financial and investor
investor

Potential impacts
• Business environments and financial markets experience extended volatility Ideas and insights
globally as a result of continued risk and uncertainty. • Demonstrate informed, competent
and effective board and management
• Employees, customers, investors, lenders, business partners, regulators and leadership to reduce risk and
other stakeholders have important concerns and information needs that maintain trust
companies will need to promptly address. • Review controls and related
• Corporate strategy, operations and financial position are affected, requiring documentation and processes used to
evaluate any impact on the financial
timely communications and public disclosures.
statements/ footnotes
• SEC rules may require timely disclosure of material risks and related • Engage with your key stakeholders to
business and financial matters. understand and address their
developing needs and concerns
Assessing your current state 1 2 3 4 5 • Coordinate communications so that
they are clear and consistent,
5.1 Is the right multidisciplinary team in place to effectively responsive to stakeholder demands
identify and address the array of issues and demands that face
the company, its operations, its employees and other key
for information and compliant with
stakeholders? applicable regulatory requirements
5.2 Do the company’s controls and procedures enable the
prompt identification, assessment and communication of
impacts on the company’s business environment, strategy,
operations, and financial condition and reporting?
5.3 Are the company’s information and communication
strategies and practices effective in keeping the board and
management appropriately informed and key stakeholders up
to date?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 8
 6. Risk
Risk

Potential impacts Ideas and insights

• Labor constraints and shortages that impact services and customers • Review risk simulation and scenario
• Stress on working capital due to supply chain disruption planning for a global pandemic
• Develop a comprehensive enterprise
• Dynamic and unpredictable response in consumer demand
resilience model to identify, prioritize,
• Third-party materials and service breakdowns that impact operations plan and respond to risk events
• Technology disruptions as a result of infrastructure changes, including new • Discuss resiliency and business
workforce locations continuity planning adjustments
needed
• Deploy leading-edge technologies to
rapidly respond to changing employee
Assessing your current state 1 2 3 4 5 workload issues
6.1 Have you tested your business continuity plans and
reviewed the requisite business impact assessments?
6.2 Have you identified the largest upside, outside and
downside risks associated with the pandemic?
6.3 Are you able to quickly determine the potential disruption
impact through your enterprise risk programs and implement
alternative plans?
6.4 Do you have the flexibility to repurpose
operations — from suppliers to employees?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 9
 Government 7. Government and public policy
and public
policy

Potential impacts Ideas and insights

• Government-issued policies, regulations and laws could impact different • Proactively monitor information from
aspects of a business and its operations (e.g., movement of people, key government sources, track
interstate commerce, health guidelines, regulatory oversight and responses from peer companies and
obligations). engage with relevant business
associations
• Governments will spend significant amounts to deal with the pandemic and • Establish timely communication and
may partner with nongovernment organizations. connectivity with federal, state and
• Multinationals may need to navigate potentially conflicting government local government contacts relevant to
directives. your business
• Note that businesses should be aware
of and anticipate potential changes
Assessing your current state 1 2 3 4 5 that may impact business operations
• If applicable, proactively engage with
7.1 Are we appropriately connected to relevant government
agencies and national and international sources of information
regulator(s) and other government
(e.g., local/state health authorities, CDC, regulators)? authorities
7.2 Is there a single source, or primary point of contact, for the
government within your organization?
7.3 Do you have contacts beyond the federal level — at state
and local levels — that may be relevant to pandemic response
issues?
7.4 Is there an established communications network to
disseminate relevant information across the organization and
to leadership?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 10
 Technology
and
8. Technology and information security
information
security

Potential impacts Ideas and insights

• Increased remote user access creates the need for a scalable infrastructure • Conduct risk model analysis of
and security configured to support workforce mobility. infrastructure technology to evaluate
• Disruption to third-party technology service providers poses additional mobile workforce support capability
and change in apps/services traffic
technology strains and security risks. patterns and demands
• There may be increased susceptibility to technology disruptions and • Utilize infrastructure technology
potential service degradation due to increased network traffic, reduced requirement definition and design to
capacity and so on. support demand-triggered scalability
and agility
• Deploy relevant automation
technologies to ease operations and
Assessing your current state 1 2 3 4 5 employees
• Identify mission-critical IT services
8.1 Have you tested your core technology infrastructure and
operation services (e.g., mobile workforce, network traffic
and essential workforce to reprioritize
patterns, operations support, crucial apps) scalability and demand and plan alternative staffing
agility around pandemic events? to fulfill shortage in skill sets
8.2 Have you defined technology service policies to prioritize
and address emergency operations support with limited IT
workforce?
8.3 Have you assessed the impending pandemic risks for
essential IT workforce and third-party service providers?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 11
 Insurance &
9. Insurance and financial recovery
financial
recovery
Potential impacts Ideas and insights
• Mandatory closures, impacts on supply chain, travel restrictions and • Carefully review your insurance
significant uncertainty all could affect business. policies in light of potential pandemic
• Business interruption, contingent business interruption, event cancellation, outcomes
stock throughput, supply chain, ingress/egress, civil authority and general • Beyond insurance, remember that
force majeure may be an option (i.e.,
liability are all potential areas around which to seek insurance coverage. contract clause that allows parties to
• If a federal emergency is declared, there may be additional financial suspend/terminate contractual
assistance available (e.g., eligible grant funding). obligations)
• Develop plans now to expedite
financial recovery and mitigation after
catastrophic loss through insurance
claims or other disaster/pandemic
grant programs
Assessing your current state 1 2 3 4 5
• Note that claim preparation costs may
9.1 Have you reviewed your insurance policies for specific be recoverable through insurance or
coverage related to COVID-19? direct administrative costs
9.2 Have you implemented procedures to capture costs and
required documentation to support any potential claims?
9.3 Do you have a team and required resources to measure,
document and prepare complex business interruption claims?

Assessment scale: 1 = Not currently being addressed; 2 = Unsure of current status; 3 = Plans under
development/review; 4 = Being partially addressed; 5 = Being fully addressed.
Page 12
Assessment summary/next steps

Topic/question Overall Owner/responsibility Action steps Timing

assessment
1.1. Are you proactively monitoring disruption triggers, such as social unrest, natural
disasters, cyber attacks, labor disputes and so on?
1.2 Do you have visibility into your first-, second- and third-tier supplier health and
capacity?
1.3 Do you have the ability to quickly respond to supplier or vendor disruptions? Are
you prepared to ramp up alternative suppliers?
1.4 If consumers stay home, is your e-commerce model strong enough to maintain
sales?
2.1 Have you provided access to internal and external resources (e.g., WHO, ISOS,
CDC) to raise awareness?
2.2 Are you providing timely updates through internal communications to employees
to educate and inform?
2.3 Have you established guidance to protect the health and well-being of personnel
by containing and protecting against the spread of the illness?
2.4 Have you created an empathetic digital communication strategy to support
employees and families impacted by the illness?

Page 13
Assessment summary/next steps (con’t)

Topic/question Overall Owner/responsibility Action steps Timing

assessment
3.1 Have you implemented the right precautions in your facilities to prevent the
spread of the virus?
3.2 Do you have a means for employees to report health concerns?

3.3 Do you have a strategy for modified business travel to minimize impact?
3.4 Have you addressed the legal and health risks of your employees, including your
contingent workforce?
3.5 Have you prepared for immigration-related measures being put in place?

4.1 Have you implemented a communications campaign to address the impacts of

the pandemic?
4.2 Have you taken action to improve sterile packaging?
4.3 What actions have you taken to regarding relevant safety issues, such as food
safety?

4.4 What precautions have you taken so that your e-commerce capabilities are ready
for pandemic-driven demand surges?

Page 14
Assessment summary/next steps (con’t)

Topic/question Overall Owner/responsibility Action steps Timing

assessment
5.1 Is the right multidisciplinary team in place to effectively identify and address the
array of issues and demands that face the company, its operations, its employees
and other key stakeholders?
5.2 Do the company’s controls and procedures enable the prompt identification,
assessment and communication of impacts on the company’s business environment,
strategy, operations, and financial condition and reporting?
5.3 Are the company’s information and communication strategies and practices
effective in keeping the board and management appropriately informed and key
stakeholders up to date?
6.1 Have you tested your business continuity plans and reviewed the requisite
business impact assessments?
6.2 Have you identified the largest upside, outside and downside risks associated
with the pandemic?
6.3 Are you able to quickly determine the potential disruption impact through your
enterprise risk programs and implement alternative plans?
6.4 Do you have the flexibility to repurpose operations — from suppliers to
employees?

Page 15
Assessment summary/next steps (con’t)

Topic/question Overall Owner/responsibility Action steps Timing

assessment
7.1 Are we appropriately connected to relevant government agencies and national
and international sources of information (e.g., local/state health authorities, CDC,
regulators)?
7.2 Is there a single source, or primary point of contact, for the government within
your organization?
7.3 Do you have contacts beyond the federal level — at state and local levels — that
may be relevant to pandemic response issues?
7.4 Is there an established communications network to disseminate relevant
information across the organization and to leadership?
8.1 Have you tested your core technology infrastructure and operation services (e.g.,
mobile workforce, network traffic patterns, operations support, crucial apps)
scalability and agility around pandemic events?
8.2 Have you defined technology service policies to prioritize and address emergency
operations support with limited IT workforce?
8.3 Have you assessed the impending pandemic risks for essential IT workforce and
third-party service providers?
9.1 Have you reviewed your insurance policies for specific coverage related to
COVID-19?
9.2 Have you implemented procedures to capture costs and required documentation
to support any potential claims?
9.3 Do you have a team and required resources to measure, document and prepare
complex business interruption claims?

Page 16
Appendices
Example: SC rapid response/establishment of a crisis management task force
Key dimensions Risk exposure Rapid response timeline
Low High
Week 1 2
SC intelligence & analytics
Creating transparency
• Critical data visibility
• Critical area gap identification Deep dives on dimensions

Dynamic network optimization Risk assessment

• Global trade, tax, policy Deploy crisis task force
• Securing inbound/outbound flows
Develop quick action plans
Integrated sales/ops planning
• Demand and supply plan refresh Rapid response checkpoint
• Production, fulfillment plan/redesign Continuous monitoring
Supplier & commercial mgmt.
• Supplier mapping and due diligence Overall response team findings*
• Supplier/customer contract risk and • Need for restrictive travel and event policy –
enforcement immediate implementation
• Imminent risks in supply chain required
Financial & risk impact mitigation • immediate action to secure inflows
• Financial impact assessment • Just-in-sequence supply at risk – immediate action
• Risk and assurance impact analysis required
• Short-term liquidity problems identified –
Workforce planning/governance
implementation of emergency actions required
• Labor constraints and impacts
• Crisis governance and communications *Example
Call for action

Page 18
Immediate supply chain actions to take in response to COVID-19
SC intelligence and
analytics
Initiate communications protocols
and reporting cadence
Validate current-state impact and
understanding of COVID-19
Highlight immediate gaps in
current supply chain
(manufacturing, suppliers,
inventory management, planning,
logistics)
Quantify cost of current and
potential issues driven by supply
disruptions and changes in
demand
Overlay current supply chain to
COVID-19 WHO tracker for future
identification of challenges
Develop additional hypotheses on
most likely courses of action and
worst case scenario planning
(wargaming)
Command and decision-making delegation
Corporate and supply chain reporting
Page 19
Dynamic network
optimization
Identify critical parts and
associated first- to third-tier
supplier locations required to
maintain operations and
anticipated production plans
Consider alternative ports,
transportation methods and trade
routes throughout the supply
chain based on facts and
hypotheses; develop activation
plans accordingly
Determine production constraints
and capacity
Assess impact of transportation
and production labor shortages
driven by travel restrictions
Initiate communications plan for
key locations to update status and
projected status
Evaluate channel signals (i.e.,
increase in e-commerce)
Workforce re-planning
Crisis playbook development
Workforce planning, governance & communications
Integrated sales/ops
planning
Reassess demand based on
outbreak-driven market
adjustments (e.g., new demand
driven by supply constrictions,
reduced demand from countries
closing off from market)
Review inventory levels to
evaluate emergency inventory
management strategies (e.g.,
pooling)
Adjust and optimize production
plan focus to accommodate
anticipated disruptions
Synchronize supply,
manufacturing, logistics and
fulfillment to meet demand in
short term and midterm
Reposition inventory in known or
high potential threat areas
Supplier and
commercial mgmt.
Identify supplier options and
associated supplier locations
required to maintain operations
and anticipated production plans
Collaborate immediately with
customers and suppliers to
respond collectively from demand
to supply
Identify and qualify alternative
sources of supply
Monitor lead times to gauge
performance
Build long-term implications and
issue tracker to de-risk impact to
business as usual after crisis event
Support suppliers with contract
compliance and update where
possible
Assess contract financial
obligations and actions
Define SC resiliency opportunities for long term
Assess readiness by function (people, process,
technology)
- Two-week checklist
Financial & risk impact
mitigation
Execute risk response strategy for
at-risk suppliers
or their respective Tier N
suppliers
Prepare responses to supplier
invocation of force majeure
clauses
Identify any nonfinancial
opportunities and threats to the
business due to communications
or perceived change in operations
Continue risk and controls
assurance as processes and
operations shift globally
Identify current and future
contract exposure
Conduct vendor onboarding
Identify any cash constraints and
liquidity/working capital
opportunities
EY | Assurance | Tax | Transactions | Advisory

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