Crisis Management Amid Coronavirus

The coronavirus outbreak is forcing many food businesses to turn on crisis management mode.

Amazon had to act as its first employee in its Amazon Brazil office in Seattle tested positive for coronavirus, reported Business Insider (March 3). The news followed two days after two Amazon employees in Milan, Italy tested positive for the virus.

In response to coronavirus, Amazon asked all its 798,000 employees to stop non-essential travel inside the U.S. and abroad. Other tech companies like Apple, Google, Facebook, and Microsoft, also have strict travel guidance in place.

Meanwhile, Natural Products Expo West 2020 was postponed due to coronavirus fears. New Hope Network plans to announce a new date for the show in mid-April and set up a rebate fund of $5 million to help small businesses impacted by the change.

The coronavirus is a reminder that it is important for businesses to have plans in place in the advent of emergencies. The primary goals of crisis communication and management are to limit the damage, preserve the company’s relationships and reputation, and establish a foundation for recovery, enabling the business to return to normal as soon as possible, according to ICR Strategic Communications & Advisory.

In order to achieve these goals, ICR noted companies should adhere to several principles. Response teams must move as quickly as possible to prevent rumors and speculation. They must also take initiative and lead the story before others can define the narrative.

It is also critically important for teams’ first communications to be honest and factually accurate, as well as provide all the information relevant to the crisis at the same time and be clear about what is known and not known.

In response to the coronavirus in particular, McKinsey & Co. suggests seven actions to help businesses of all kinds.

1. Protect your employees: companies can start by drawing up and executing a plan to support employees that is consistent with the most conservative guidelines that might apply with trigger points for policy changes.

2. Set up a cross-functional COVID-19 response team: nominate a direct report of the CEO to lead the effort and appoint members from every function and discipline to assist.

3. Ensure that liquidity is sufficient to weather the storm: companies should model their financials in each scenario and identify triggers that might significantly impair liquidity.

4. Stabilize the supply chain: define the extent and likely duration of supply chain exposure to areas experiencing community transmission, including tier-1, -2, and -3 suppliers, and inventory levels.

5. Stay close to customers: invest in online as part of the push for omnichannel distribution; this includes ensuring the quality of goods sold online.

6. Practice the plan: use tabletop simulations to define and verify activation protocols for different phases of response.

7. Demonstrate purpose: figure out how to support response efforts—for example, by providing money, equipment, or expertise.

Stay tuned for more information on The Food Institute’s webinar on crisis management coming soon.