Building a resilient

enterprise– Now, Next

and Beyond
A framework for navigating COVID 19

April 2020
 01 02 03 04
Contents A world
in crisis
Shifting
gears
Now, Next
and Beyond
Navigating
this crisis

Page 2 Building a resilient enterprise– Now, Next and Beyond

“The world is facing the worst economic fallout since the great depression”
The Covid-19 pandemic
and the subsequent
lockdown has dealt a
severe blow to an
already-stressed global
economy
The suddenness,
spread, and severity of
the pandemic across the
globe has pushed
countries and
institutions into
uncharted territories
Page 3
- Kristalina Georgieva, IMF Chief
200+ countries, 3 b people
areas or territories under lockdown or
with Covid-19 cases 1/3rd of the world’s
population
Simultaneous 2-3% Global
double digit dip contraction of unemployment
in global supply and global GDP levels at an all
demand time high
170 countries ~2500+ Significant
to experience negative government decline predicted
per capita income pronouncements to for global trade in
growth in 2020-21 manage the crisis 2020-21
# Estimates based on multiple sources: Bloomberg, UNCTAD, WEF, WTO & ILO.
Building a resilient enterprise– Now, Next and Beyond
Covid-19 will have significant implications for an already stressed economy
Macroeconomic impact
Significant dip in GDP
growth while India
continues to be among
the fastest growing
economies globally
Food security measures
Adverse impact on fiscal
deficit due to dual impact of
fiscal stimulus and lower
revenue collections
Substantial erosion of
investor wealth due to
flight of foreign capital
government dues to small
Page 4
India’s response – economic recovery to Current sectoral impact
commence with graded relaxation of
Travel and Tourism
High
►
lockdown from April 20th
► Trading and logistics
Stringent national lockdown
Stringency Index (100=strictest) ► Automotive
► Construction and
Real estate
100 95.2 90.5 71.4 66.7 ► Energy
CRR cut to release INR
Economic stimulus of ► Financial Services
National ~1.4 trillion liquidity
Severity of Impact
INR 1.7 trillion
lockdown Repo rate reduced to ► Retail
historical low of 4.4%
for poor ► Education
Fiscal Monetary Moratorium on loan
Direct cash transfers ► Healthcare
payments
~$ 2.9 trillion
Indian
economy
► Non-essential FMCG
Industry Healthcare ► IT services
Govt. to bear employee INR 150 billion allocated to
provident fund augment healthcare ► Pharmaceuticals
contributions
Government-sponsored ► Essential FMCG
Extension of dates for insurance cover for all
filing financial results healthcare workers ► Online businesses
Accelerated payment of ► Telecom
600+ dedicated hospitals,
Low
100K+ isolation beds
/ medium industries
# Multiple sources: Oxford, Bloomberg, Reuters & RBI.
Building a resilient enterprise– Now, Next and Beyond
The path to recovery for India: a prolonged “see-saw” shaped recovery looks
most likely, leading to a “new normal”
Optimistic scenario
“New Normal”
GDP

“V-shaped” ► Contingent on a vaccine / effective treatment by Q2’20, and nil strain mutation
► Aided by government stimulus, pent-up demand unleashed
Industries
► World economies stage a recovery to pre-crisis levels

time

Most likely scenario Recovery

► Deeper and pervasive recession, followed by a slower with ups Markets
GDP

“See-Saw” recovery and likely deflation and downs

► Higher public deficit levels due to stimulus programs
► Protracted weak demand and global value chain disruptions
► Higher capital outflows and currency depreciation
time

Pessimistic scenario Societies

► Prolonged mobility restrictions reinforced due to lack of effective treatments
GDP

“L-shaped”
► Increased fiscal and inflationary pressures due to even higher stimulus programs
► Flight of capital and foreign exchange depreciation
► Personal, business and (potentially) sovereign defaults

time
Page 5 Building a resilient enterprise– Now, Next and Beyond
 01 02 03 04
Contents A world
in crisis
Shifting
gears
Now, Next
and Beyond
Navigating
this crisis

Page 6 Building a resilient enterprise– Now, Next and Beyond

 The “New Normal”- changing companies, markets and societies – may mark a shift
to a “Quality economy”

Social
impact
Environment Globalisation
From… Interaction
with To…
customers
Solidarity Trends
Interaction Interaction
with com- with
petitors Company business Quality
Current
normal
Consump-
tive
behaviour partners Personal
relation- economy
?
Interaction Interaction
behavior with ships
with
suppliers Govt

► Clean
Openness to
Work/life
technology ► Connectivity
Growth ► Community
Or… ► Creativity
► Conscientious
Back to
normal
?
Page 7 Building a resilient enterprise– Now, Next and Beyond
 “Quality economy“ - key drivers of the shift

Environment Solidarity Consumption Technology Work/Life

Learnings from the Will social distancing Will we consume more Will we embrace Will we balance wealth
involuntary positive become a norm ? sustainably, having felt technology as a means accretion with better
impact on the scarcity for the first to a resilient society? quality of life?
environment? Will there be room for time in decades?
charitable business Will fitness and health get
Will this create models? prioritized?
business
opportunity?

Globalization Cost structures Financing / Cash flows Supply chain Demand

Will there be How to diversify site How to ensure continuity?

Are virtual
protectionism?
headquarters a viable
Will we reduce business future?
and leisure travel?
Will there be variable
contracts with
partners/ suppliers?
How to plan with a greater
portfolio risk?
safety net? How to digitalize further?
Will production
How to strengthen working Is this a significant shift in
be localized?
capital management? sales channels?

Page 8 Building a resilient enterprise– Now, Next and Beyond

“Quality economy“ - stakeholder relationships are likely to get redefined

How to…. Do we…. What is the…. How can we…. What are the…. How can….

► drive engagement ► know customers ► risk in my portfolio? ► increase sharing of ► areas of common ► we enhance co-
for a virtual well enough? information? interest? creation with
workforce? ► opportunity for risk government for the
► enhance diversification? ► help each other? ► opportunities to larger good?
► reskill my digitisation? ► Geographical share cost and risk?
workforce? ► mitigate risk by ► social development
► Contractual
► improve our social cooperating ► issues that can be institutionalised?
► improve employee positioning? ► right balance on risk differently? benefit from joint
care and financial sharing? lobbying? ► countries partner to
well being? ► need to increase ► increase avoid a recurrence
closeness and build ► optimum decision engagement with and pandemic-proof
► measure effective loyalty? on own versus buy? capital providers? the world?
performance
instead of
efficiency?

Business
Employees Customer Suppliers Competitors Government
Partners

Page 9 Building a resilient enterprise– Now, Next and Beyond

“Quality economy“ – megatrends for business enterprises

M E G A T R E N D S

Industries Markets Societies

Industries will experience a Market roles shall Employee and consumer

step-change in digitalization, increasingly be based on behavior will change
flexibilization and resilience trust and shared risk irrevocably
considerations

5C’s of Quality Economy

Clean Connectivity Community Creativity Conscientious

Heighten response to Acceleration towards Re-imagine relationship Innovate towards more Increased responsibility to
public health, virtual connectivity and building at a global and sustainable, flexible and balance fiscal, operational
sustainability and digital transformation hyper-local level profitable business and organizational
environmental solutions solutions decision-making

Page 10 Building a resilient enterprise– Now, Next and Beyond

 01 02 03 04
Contents A World
in crisis
Shifting
gears
Now, Next
and Beyond
Navigating
this crisis

1
1

Page 11 Building a resilient enterprise– Now, Next and Beyond

How will you respond to this “New Normal“?

To protect the well-being of all stakeholders, support critical operations and restore market confidence, the C-suite
must consider an adaptive response across 3 time horizons

1 N o w 2 N e x t 3 B e y o n d

Provide an immediate Address liquidity Fundamentally change the

response to the crisis by challenges and develop a operating model and
protecting staff. Optimize response plan to return prepare for sustainable
cash and costs to withstand business to original levels. growth. Engage with all
a prolonged disruption due Reassure stakeholders to stakeholders to ensure the
to lockdowns restore market confidence success of your vision

Market Volatility Earnings Impact Potential Global Recession Recovery New normal

Page 12 Building a resilient enterprise– Now, Next and Beyond

 Enterprises will need to respond swiftly to adapt to the “New Normal“ – Now, Next and
Beyond

NOW NEXT BEYOND

Continue Adapt operations Increase resilience Reframe
► Secure ► Fix supply chain ► Achieve lower and more agile cost base ► Seize new growth
financial stability ► Re-start production ► Increase workforce flexibility opportunities
► Continue Ensure customer Optimize supply chain – mitigate geo-risk, enhance agility ► Re-imagine relationships
themes

► ►
operations
Core

access ► Maximize digital customer access ► Re-think new business

► Protect ► Reduce cost short-term ► Enhance digitalization, automation, back up with cyber solutions
employees ► Augment cash flows security ► Apply new balance to decision
► Streamline structures, ► Revisit capital sources & allocation making
portfolio, footprint ► Adapt risk management to the new situation ► Fully digital enterprise

Employees – Keep employees informed, motivated, committed and trained

Stakeholders

Customers – Focus on brand perception and provide two-way communication loop

Capital providers – Proactive and transparent communications
Government – Monitor regulatory changes and adapt accordingly
Business Partners (including Competitors and Suppliers) – Understand full ecosystem impacts and recovery options

Shock Re-Start Continued crisis and slow recovery New normal

assumption
Underlying
scenario

Most likely Scenario – “The See -Saw” recovery

Page 13 Building a resilient enterprise– Now, Next and Beyond

 01 02 03 04
Contents A world
in crisis
Shifting
gears
Now, Next
and Beyond
Navigating
this crisis

1
4

Page 14 Building a resilient enterprise– Now, Next and Beyond

How you respond NOW will significantly define your company and brand?

C O N S I D E R A T I O N S F O C U S A R E A S
Safety of all
stakeholders Risk and resilience Cybersecurity Regulatory compliance
► Conduct risk scenario ► Facilitate remote access and controls
based impact for all stakeholders ► Assess business impact of
assessment ► Conduct threat hunting regulatory changes
► Continuously adapt risk and application testing ► Establish alternate
appetite ► Prioritise cyber processes for effective
► Empower crisis investments operation
management task force ► Align the activities of IA
function to enable support
to business
Conserve
cash and
Customer Talent and Finance, structuring
contain
and brand workforce and stimulus
costs
► Re-baseline customer ► Identify and prioritise ► Evaluate options to move
segments critical resources cash in a tax efficient
Continuity Keep pace manner
► Expand network capacity ► Communicate to and
of critical with growing for higher demand engage the workforce ► Reassess overall cash
services regulations ► Enhance digital resources ► Manage employee requirements and mitigate
for sales and service wellness working capital blockages
► Accelerate govt/tax
receivables

A C T I O N S
Business and operating model Technology
► Prioritise product portfolio in line with ► Strengthen BCP especially for critical
existing constraints business systems
► Contactless order taking and deliveries ► Augment IT team’s capacity
Create cross- Assess Covid-19 Support Build a digital
► Evaluate alternate revenue streams ► Provide cloud infrastructure based digital
functional crisis impact on communities front on priority tools to enable remote working and manage
management organisatIon to fight the for some sectors productivity
centre value chain pandemic

Page 15 Building a resilient enterprise– Now, Next and Beyond

How will you restart your business and pivot to what comes NEXT?

C O N S I D E R A T I O N S F O C U S A R E A S
Flexibalize
workforce Risk and resilience Cybersecurity Regulatory compliance
► Continuously monitor and ► Adopt next-gen Identity and controls
mitigate emerging risks and access management ► Conduct regulatory
► Refresh risk appetite and ► Migrate to Zero / Lean scenario impact analysis
risk responses with the Trust Assessment ► Evaluate alternate methods
new normal methodology of testing
► Develop a holistic ► Enhance Cyber ► Reimagine the Internal
approach for monitoring of enterprise Audit function and scope
organization-wide efforts assets
to manage such risks
Adaptive
and
Customer Talent and Finance, structuring
resilient
and brand workforce and stimulus
operations
► Strengthen direct to ► Define innovative ► Revisit capital structures
customer channels and performance and allocation
Lower and Identify and shore up digital payment measurement Reset viable “new normal”
agile cost
►
manage all capabilities ► Focus on productivity financial baseline i.e. B/S
base emerging risks ► Align marketing spends in ► Build flexible manpower and P&L
line with channel strategy and compensation models ► Enhance engagement with
► Prepare for recovery capital providers
campaigns

A C T I O N S
Business and operating model Technology
► Evaluate inorganic growth opportunities ► Support business in enhancing digital
► Re-imagine commercial/cost structures solutions
and risk sharing models with suppliers/ ► Augment capacity of digital platforms
Build multiple Prepare a comprehensive Revise policies, customers as per the new activity levels though cloud
scenarios/ models restart plan – demand, procedures and ► Rationalise product/service offerings in ► Support BYOD for onboarding all
basis impact employees, customers business practices line with demand stakeholders
assessment operations and capital
providers

Page 16 Building a resilient enterprise– Now, Next and Beyond

Can you reframe the future BEYOND this crisis?

C O N S I D E R A T I O N S F O C U S A R E A S
Enhance
stakeholder trust Risk and resilience Cybersecurity Regulatory compliance
► Setting up an early ► Use analytics for Real- and controls
warning system Time and In-line threats ► Optimize and rationalize
► Digital transformation for ► Automate cyber key controls
back to front resilience security operations ► Automate compliance
► Regular testing of end to ► Focus on data monitoring and reporting
end business recovery governance ► Digitize internal audit
encompassing ‘Privacy operating model
& Trust by Design’

Reframe
Customer Talent and Finance, structuring
enterprise
and brand workforce and stimulus
► Reposition brands in line ► Define and transition to ► Reset Financial
with revised portfolio new people operating Expectations
Become a Identify new model
► Leverage emerging ► Implement long-term
fully digital revenue technologies to deliver ► Institutionalize digital operating and legal
enterprise streams virtual customer experience ways of working structures
► Re-imagine “ digital only ► Prepare contingency ► Increase financial resilience
“sales and service models plans

A C T I O N S
Business and operating model Technology
► Innovate towards more sustainable, ► Overall review and re-baselining of digital
flexible and profitable business solutions and technology strategy
► Activation of new organic / inorganic ► Review and restart on-hold projects and
Re-imagine your Gear your business Rebuild and Drive the change and portfolio align them to growth initiatives
business for model and decision strengthen trust communicate your vision ► Create re-lapse strategies to manage “ ► Cross skilling of resources and leveraging
long term framework towards 5Cs across value across stakeholders at see-saw” economic recovery GIG economy to make up for capacity gap
sustainability of the ‘Quality Economy’ chain ecosystem global and hyperlocal level

Page 17 Building a resilient enterprise– Now, Next and Beyond

 Let’s navigate through this crisis
Illustrative C–Suite sectoral response worksheet
Enterprise Priorities across Now and Next Horizon Priorities across Beyond Horizon
Enterprise
focus areas Owner Supply Chain
Sales Disruptions Cost cutting + Digital Customer Risk Management Workforce Cost Structure Digitalization & Re-engineering of
Disruptions structural access adjustments flexibility flexibility Automation Supply
SupplyChain
Chain
Business adaptions
and CEO
operating COO
model CFO

CDO
Cybersecurity CSO
CTO

CTO
Technology COO

CMO
Customer and CDO
brand
COO

Financing ,
structuring
CFO
and
stimulus

Risk and COO

resilience CRO

Regulatory CRO Building a resilient enterprise

compliance CFO
and controls Now, Next and Beyond
Releasing shortly our sectoral Point of View
Talent and CEO
workforce CHRO (PoV) on navigating COVID 19

Page 18 Building a resilient enterprise– Now, Next and Beyond

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