Crisis Leadership: Lessons from Leading Chinese Companies

Organizations in the midst of a crisis are faced with a flurry of urgent issues across what seems like innumerable fronts. Resilient leaders zero-in on the most pressing of these, establishing priority areas that can quickly cascade.

Based on our analysis of business-continuity planning and emergency management within leading Chinese companies, we have identified several actions leaders can take:

Launch and sustain a crisis command centre.

Leading companies in China established emergency response teams right away in order to assess the risks and formulate response strategies after conducting robust scenario planning, which significantly improved epidemic response mechanism and toolkits.

After the initial outbreak, companies began implementing flexible work arrangements for middle- and back-office staff in order to minimize onsite work while meeting basic operational requirements. With remote work c apabilities being stress-tested, overall opportunities for improvement were identified and addressed. A digital employee health declaration system was also launched by some companies in order to track employee well-being and to comply with administrative reporting requirements.

Maintain business continuity and financing.

Companies immediately began to update/develop business continuity plans to understand contractual obligations, evaluate financial impacts and liquidity requirements, formulate debt restructuring plans

and optimize assets to help restore financial viability. Another core focus was to understand financial impacts across the entire value chain.

Shore up the supply chain.

Companies in China accelerated investment in digital trading solutions to combat supply chain interruptions, overcome logistics and labour shortages, and get better visibility into local access limitations in order to ensure product supply for the domestic market. Operational agility and data quality were critical in supply chain scenario planning.

Many companies quickly moved to maintain open and ongoing lines of communication with their customers on the impacts of COVID-19 to the business and the emergency actions implemented. This approach of working in partnership has built confidence amid the uncertainty.

Companies are revisiting the current e-commerce landscape and developing digital road maps for the short, medium and long term. Some leaders in the service industry quickly promoted ‘no touch’ experiences in order to shift away from brick-and-mortar presence.