It’s reasonable to be concerned about the spread of the coronavirus worldwide. But it’s not the time to panic, especially for organisations, said Jennifer Elder, CPA/CFF, CGMA, a consultant and author. Business leaders should be proactive in putting emergency plans in place: for employee wellbeing, business continuity, remote working, and other areas.
“It’s not just about you and your business,” Elder, the owner and president of The Sustainable CFO consulting firm, said in a podcast about disaster planning. “You really have to be mindful of what’s happening with your employees, your customers, and your vendors. You start to realise that your company has an ecosystem, and if one part is not healthy, it affects everything else.”
Elder developed a set of tips and a list of questions for organisations to consider in planning for the effects of the virus:
- Don’t panic but do plan.
- Show concern for your employees: Give them an opportunity to share their concerns and ask questions. Consider having an education session featuring a nurse or doctor.
- Show concern for your customers. For any customer or client meetings, offer the opportunity to meet virtually. For your business customers or clients, share your wisdom on protecting their business and planning a response.
- Communicate and educate frequently.
- Brainstorm with every department: How might you be affected?
- Brainstorm possible options to mitigate the impact.
- Document what you will do, when you will do it, and who will be responsible.
Questions about your employees
1. How can you best protect your employees?
2. Will you train your employees on how to identify coronavirus symptoms?
3. If an employee does not have available sick time, how do you make sure they do not come to work if they are sick?
4. How will you respond if an employee is diagnosed with coronavirus?
5. Who can work from home?
6. How will your employees get access to the necessary information and documents they need to work from home?
7. Will you allow employees to travel?
8. If employees must travel, what steps will you take to ensure their medical safety?
9. How will you respond if an employee needs to care for an infected family member?
10. If an employee contracts coronavirus, will they only be allowed to use their accrued sick time?
Questions about your operations
11. What parts of your business are crucial to keep operating?
12. When should you exclude visitors from your offices?
13. How will you decide if you need to close an office?
14. Will you close your business for the recommended two-week quarantine or longer?
15. How will you disinfect your office?
16. How will you keep employees, customers, and vendors informed?
17. Should you postpone meetings, events, or travel?
18. How will you communicate with employees, customers, and vendors if you have to close your offices?
19. Is your IT system robust enough to handle the demand if more employees are working from home?
Questions about your finances
20. If your offices are closed, how will you collect payments?
21. How long can your business survive without any new sales?
22. How will you pay your bills and payroll if your office is closed?
23. Do you have available lines of credit?
24. Will you pay your employees, and for how long, if you close your office and employees are not working? Do you know what the legal requirements are for such payment?
Questions about your customers
25. Will you notify customers if an employee is diagnosed?
26. How will you stay connected to customers if employees are out sick or the office is closed?
27. How will you deliver on contracts if the office is closed or there is a disruption in your supply chain?
28. Do you have a “force majeure” clause in your contracts that might alleviate some liability in the case of a crisis such as this?
29. How will you respond if a customer is affected by the coronavirus and does not pay your invoice on time?
30. Are there ways you can assist your customers in addressing the coronavirus?
Questions about your supply chain
31. Who are your mission-critical vendors?
32. Which vendors should you call to discuss their coronavirus plans?
33. Do you currently source any supplies or products from China?
34. How would a delay in delivery of materials and products affect your production?
35. Do you have alternate suppliers?
This is not an all-encompassing list but a place to get started thinking about your response, Elder said. And begin as soon as possible, she advised. “The worst time to try and figure out your response is in the middle of a crisis.”
For more news and reporting on the coronavirus and how management accountants can handle challenges related to the outbreak, visit FM’s coronavirus resources page.
— Neil Amato (Neil.Amato@aicpa-cima.com) is an FM magazine senior editor.