This case study is a brief article regarding the need for Business Continuity Planning for a Pandemic outbreak, present or future. As seen with COVID-19, a lot of grief and disruption could have been avoided if Business Continuity had taken the plausibility of a full-scale global/national pandemic a bit more seriously.
We have to assume that, even after COVID-19, another pandemic scenario could happen in our lives. Thus, this case study serves as an exercise in how logistic service providers can better prepare themselves.
The case study is based on a fictionalized company in some respects. As this organisation is only beginning to appreciate the need to plan for a pandemic during the start of COVID-19, its plan is not yet complete. The case study necessarily reflects this BC planning process.
Anywhere Logistics Limited (ALL) is a ‘third party logistics service company’ (3PL) i.e. a company which provides logistics services to companies including: inbound logistics; warehousing; order picking; and customer delivery services.
ALL would have to consider suspending operations to minimize financial exposure. The fact that the major part of ALL’s work is subcontracted would mitigate the financial exposure. However, suspending operations could place contracts with customers at risk, and could make it difficult to re-engage subcontractors (who might have obtained work elsewhere) after the pandemic.
5. The initial impact assessment also suggested that, without being alarmist, the pandemic
could affect a number of ALL’s key management team. Planning for deputies and succession
would be required.
n Inclusion of plans for a pandemic within ALL’s Business Continuity Planning became a clear priority. A project team was established. Using the Business Continuity Planning for Pandemic, the team began the planning process as set out in the steps below.
Planning involved the following steps:
1. The project team identified critical activities within ALL’s business, essential for business
continuity. These included:
2. The project team assessed the likely impact of 40% absences in these critical areas.
3. The project team has contacted major customers and asked them for their business continuity plans in relation to continuity of supply. To date, two major customers have responded. One is a major multinational with a range of products which would not be considered ‘critical’ during a pandemic. This company could cope with a reduction in sales and distribution for its products during a pandemic, and has undertaken to keep ALL advised of its plans. The second company is also a major multinational, but in this case with food products which would be considered essential. It is currently assessing market priorities and options such as stock building and has also undertaken to involve ALL in its planning process. A third major customer is also a food company; the project team is still seeking a response to its request for information.
4. Based on the information received to date and on the assumptions made, the project team has prepared financial impact statements for the business for review by the senior management team, in order to agree points at which business might have to be suspended and the financial and business risks associated with such a decision.
5. ALL’s employees have limited direct contact with suppliers or delivery customers with orders being processed on-line. Most of this contact is with the inbound and delivery drivers.
Accordingly, the need to further limit face-to-face contact is limited. In relation to administrative employees, the project team has identified those tasks which could be managed from home, and has identified the IT resources required to make this happen.
6. The project team has identified employees with special needs (e.g. older or asthmatic) to receive special medical advice.
7. The team has analysed business related travel for the last year as a guide to action steps required. Most travel related to visits to customers for regular management and coordination meetings. It has been agreed that in the event of a pandemic, such meetings would be held through teleconferencing.
8. The financial controller has been asked to develop a plan to manage day to day financial matters. This plan will be submitted to the project team for review and inclusion in the overall plan.
1. With appropriate medical advice, the project team has developed policies for returning
to work after infection, and for those showing symptoms while at work.
2. It has also developed policies to facilitate working from home, including expenses related
to telephone calls and installation of broadband.
3. A contingency plan for key employee replacement in event of illness has been prepared.
4. As the operation of the warehouse is based on flexible working practices, with all employees
qualified to use forklifts and capable of performing other warehouse tasks, no plans for
cross-training were required.
5. A communications plan has been developed. This includes:
6. ALL’s insurance broker has been asked to review all policies and to advise on any necessary
amendments to cater for a pandemic.
1. ALL’s cleaning is conducted by a contracted agency. The project team has contacted this agency for details of expected continuity plans in the event of a pandemic and assurances that the contract cleaners have the necessary knowledge and training to cater for a pandemic. Mindful of the fact that contract cleaners will also be affected by employee absences, just as demand for their services rises, the project team has recommended that selected internal staff be receive training in relevant cleaning skills.
2. Stocks of hand wash, towels, tissues and cleaning materials have been ordered.
3. Based on advice from the various information sources, policies to reduce face-to-face contact internally, particularly in ALL’s open plan administrative office and warehouse floor, have been developed.
1. Although a logistics company is part of a complex supply chain and, therefore in theory, has
multiple contact points with suppliers and delivery points, in reality, the number of face-to-face contacts is relatively few and can be controlled. The biggest challenge to developing a comprehensive business continuity plan for a pandemic has been obtaining useful information from the various contacts in order to develop the plan.
2. The nature of the work of a logistics company is that the volume of work should decrease in
proportion to the resources available and therefore should be manageable. The risk is that, as a service provider, any service failure could be held against ALL when the pandemic is over and normal business resumes.
3. Planning without risking unnecessary panic is a challenge.
ALL’s managers are relieved that they have identified the need for business continuity planning for a ’flu pandemic in time to comprehensively prepare. The complexity of the planning required would not have allowed this to be a ‘last minute’ process.
Goh, M. H. (2016). A Manager’s Guide to Implement Your Infectious Disease Business Continuity Plan, 2nd Edition. GMH Pte Ltd.