By: Renisha Rajpaul, Executive Head of Business Risk, Vodacom Group
Summary: The World Health Organisation declared the Coronavirus as a global health emergency, urging that the global community should demonstrate solidarity and cooperation in responding to the outbreak. At time of writing this report, the coronavirus had infected close to 80,000 people, the vast majority of them in China, killed more than 2500 and spread to almost 30 countries. In addition to the health risks, the virus could potentially poses various business risks similar to the SARS outbreak in 2003 which had a global economic impact of around $53 billion.
Impact of Coronavirus: China is currently the world’s second largest economy and central to a diverse range of global supply chains. In an effort to contain the spread of the virus, the Chinese government has imposed restrictions on the movement of people which has resulted in manufacturing disruptions, shipping restrictions and international travel bans. In South Africa the officials have responded by establishing a specialised task team to prevent the spread of the virus, heightening screening at national ports and issuing clinical guidelines for health workers and citizens.
Due to globalisation and the interdependency on China, which is a critical trade partner for Africa, leaders in Africa must understand how the pandemic will affect their organisations and put into place the measures to manage the impact. Risk management professionals must begin to engage their stakeholders and sensitize their boards on the impact of the outbreak (direct and indirect). Vodacom, a leading telecommunication provider with presence in over 50 countries offering services to 110 million customers, conducted a high-level impact assessment on how the consequential effects of the Coronavirus could have on South African businesses.
Potential Responses Strategies
- Prepare your organisations Pandemic Preparedness Plan along with your Business Continuity Plans
- Diversify multi-vendor ecosystem
- Alternative strategies to counter dramatic revenue losses
- Increase critical goods reserves
- Localise critical skills
- Awareness and information sharing
- Enhanced physical security measures against public hysteria
- Up to date media responses/statements for fake news
- Willingness to compensate affected parties