The coronavirus is a reminder 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 quickly as possible to prevent rumors and speculation. They must also take initiative and lead the story before others can define the narrative for them.
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 what is not.
In the Supply Chain
According to a recent National Retail Federation survey, 40% of members report experiencing supply chain disruptions due to the coronavirus.
According to Harvard Business Review, risk management principles should be applied to tiers one and two in company supply chains, at a minimum, while beyond tier two, risks should at least be understood. Companies should use revenue impact and risk of supply disruption to prioritize supply chain-resiliency measures.
Some practical ways to approach high revenue impact supplies include monitoring supplies 24/7; sourcing from two suppliers, rather than one; mapping suppliers’ manufacturing, warehouse, and distribution sites to ensure they’re not all in the same region; and buying insurance to cover profits lost from a disruptive event at critical suppliers’ sites.
Companies should at least invest in 24/7 monitoring of their global suppliers. Technology, such as artificial intelligence and natural-language processing, have made extensive supplier monitoring affordable and readily accessible.
Companies In Demand
Shares of Campbell Soup Co., Conagra Brands Inc., and other packaged food companies rose after reports that shoppers are stocking up their pantries as the coronavirus spreads. The S&P 500’s packaged food index rose 4.7%, the most since 2016, reported Bloomberg (March 2).
Campbell Soup will increase output of products like canned soups, snacks, and Spaghetti O’s amid the uptick in demand, reported Bloomberg (March 5). While the company receives approximately 90% of its ingredients from North America, about 2% comes from China, including some packaging and apple juice concentrate. The company has been able to find alternative sources for those supplies.
Also in demand is food for hikers and campers as consumers stock up on non-perishable food, reported The Wall Street Journal (March 5). Mountain House’s transactions on its website rose 10-fold in February and orders from retailers were as much as five times higher, while Kind LLC’s sales of its snack bars were up as much as 50% in the final week of February.
In addition, Territory Foods, a prepared meal delivery service, saw a 100% surge in growth when cases of coronavirus started emerging in California, according to CEO Abby Coleman. “We are seeing a similar surge happening on the East Coast, which began with NYC and is likely to extend to DC,” she said.
“For our corporate clients, whom we feed in the office, we are transitioning orders directly to employees’ homes so there is no disruption of benefits,” said Coleman.
Territory Foods’ in-house safety team built a cross functional task force made up of operations, customer service, supply chain, and vendors. The task force has become a central hub for up-to-date guidelines and information provided by government agencies to ensure enhanced safety standards are being exceeded.
In order to prepare for future crises, Coleman suggests the best way to plan is to cultivate a productive response, as well as creating a team to do scenario planning during low seasons.
“Create a template for crisis communication to team members, vendors, and customers,” she noted. “Create a list of key individuals who need to be spoken to and who will do the outreach. Scenario plan against back-up forms of communication.”