Business continuity planning needs to anticipate worst-case scenarios

WITH a rapidly-changing Covid-19 outbreak situation - and the resulting shifts in government policies - it is more crucial than ever for companies to have thorough business continuity plans, and update them frequently in anticipation of developments.

The past weekend gave a taste of how swiftly things can change. From Sunday at 11.59pm, Singapore blocked entry or transit for visitors with travel history to Italy, France, Spain and Germany within the last 14 days, amid a surge of Covid-19 cases in Europe.

On Sunday, the Health Ministry (MOH) advised Singaporeans to defer all non-essential travel for the next 30 days, and imposed more restrictions on inbound travellers. From Monday at 11.59pm, travellers from Japan, Switzerland, the UK and Asean countries entering Singapore will be issued with 14-day stay-home notices.

On Monday night, Malaysian Prime Minister Muhyiddin Yassin announced a nationwide lockdown from March 18 to March 31, shutting all businesses except shops selling food and daily necessities.

Firms that reacted to earlier restrictions by, say, changing destination countries for business meetings, might have been caught off-guard by the Singapore government's 30-day blanket advisory.

Similarly, companies here that assumed neighbouring countries would remain unaffected by restrictions might have been surprised by the strict measures being applied to arrivals from Asean countries. Malaysia's lockdown means there are restrictions on the entry of tourists to Malaysia, while all Malaysians are prohibited from travelling overseas during the two-week period.

More generally, as the MOH noted, border restriction measures could be extended to more countries "as the global and local situation evolves".

For many businesses, Malaysia is a traditional source of labour commuting daily to fill jobs in Singapore. What if this flow is curbed for much longer than just the two-week lockdown period?

Although the Singapore government has repeatedly said that the country cannot shut its doors entirely, firms would do well to contemplate worst-case scenarios, and have an idea of how business can continue even with the most stringent travel curbs. After all, unpredictability is everywhere: doors could shut abruptly, as several European nations did this weekend.

A month or so ago, firms might have been hoping for the virus situation to clear up by mid-year, and many may not have planned for the scenario in which it persists. But now, experts and leaders are warning that the virus may be here for the long haul.

Business continuity plans have to go beyond the traditional model of reacting to a discrete incident, to preparing for drawn-out scenarios as well.

Firms need to plan for the future in a more general sense, too. Beyond immediate measures such as telecommuting, split-team operations or visitor monitoring, firms must consider the robustness of their supply chain or manpower sources.

The importance of having sufficient supply chain and labour source diversification became clear early in the crisis, when firms that were dependent on workers, suppliers or customers from China were hit.

But as the virus now spreads worldwide, it brings home the point that no single country - as a source of labour components or demand - should be too heavily relied upon. In these extraordinary times, not even the most traditional of sources should be taken for granted.