Command center for

COVID-19: pandemic
rapid response

Business continuity planning

March 2020
In the midst of the Heading
Survive Operate Win
Sub-heading
global pandemic,
businesses are
acting fast to meet Relevant evidence and
these crucial – How to get organized – As things become information. Keep sentences
– As new industry
right away and more certain, how do concise. Avoidemerge,
dynamics jargon and how
challenges identify gaps in your you operate in the new
repetition.
– can
First you
bulletbe successful
level
plans thus far environment? in
– the newbullet
Second normal?
level
– Immediate actions – What decisions or – How can you turn the
required across the tradeoffs do you have crisis into opportunities:
business to make within the first gain share, consolidate
few months? your position, deepen
– How to stay – How do you begin to loyalty?
responsive to the prepare for the next – How can you learn
daily changes you will phases of the crisis? from this experience,
face build the lessons into
your plans, and
prepare for future
impactful events?

Focus of this document

2
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Kearney’s rapid
response Employees Functional Consumers
task forces and customers
framework
requires core
business pillars to
work concurrently
Commercial Financial
COVID-19
command center and
communications

Executive
leadership

Human Technology
capital

Addresses the
Focus of this document full supply chain
(plan, source,
make, deliver)

Operations Stakeholders and

3 Suppliers shareholders
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Executive teams Set up a “command center”—the central body for decision making,
must demonstrate coordination, and communication—immediately
leadership to – The center will serve as a central leadership point for all crisis management activities,
ensure the safety accountable to the CEO and executive leadership, led by a senior leader empowered to
made decisions and direct work.
and health of
– An agile approach and use of digital tools will enable regular, quick updates and close
every employee collaboration.
while also
focusing on Create and execute a robust communication plan with “one voice” focused
business on both internal and external stakeholders
continuity – Develop key messages to raise awareness, support business continuity, encourage calm,
demonstrate readiness, and provide direction.
– Frequent internal and external communication is vital in the early stages; adjust as situation
requires.

Create a detailed set of actions and enact “emergency processes” where

needed
– “Emergency” processes will need to be launched for crucial areas (for example, financial
scenario planning, S&OP) to enable real-time adjustments to key business plans.
– Accelerating efforts for in-year cost take-out measures is paramount to minimize P&L
impact.

Over time, begin preparing for a return to a “new normal”

4 – Plans will be needed to restart operations and replace or retrain employees, among other
things. Lessons learned should be codified to inform ways of working moving forward. Kearney XX/ID
 – How will an immediate shift in consumer behaviors impact the business?
– What revisions are required to consumer/customer policies and priorities?
There are key – How do we amplify or improve communications with consumers and
Commercial
questions to customers?
consider as you – What steps should be taken now to protect the brand and improve long-
term relationships?
build your detailed
plan to orchestrate – Have financial forecasts been modified to consider realistic and true
a rapid response “worst-case” scenarios?
Financial – Are profit improvement initiatives under way to cover anticipated gaps
to the COVID-19 (for example, near-term procurement efforts or supply chain cost
crisis reduction)?

– Is there a clear employee communication strategy with two-way feedback?

Human capital – Have HR policies been reviewed and flexed as needed?
– How will you confirm safety and support of all employees (healthy and
sick)?

– Do we understand changes to demand and customer scenarios?

– Are our S&OP processes able to adapt to rapid changes?
Operations – How do we best protect plants and DCs to allow maximum output and
avoid shutdown?
– Can we rapidly adapt our capacity? Stop and restart production?
– Are our managers and EHS protocols staying focused on safety?

– Are our systems prepared to handle large work-from-home efforts?

Technology – Are we maximizing the usage of technology to manage internal and
5 external communication (for example, texts, virtual meeting spaces)?
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COVID-19 impacts
every step of the
value chain—it is
crucial to be
prepared for key
scenarios
Tracing back needs from
consumers to suppliers will
help companies prepare
accordingly
6
Alternative to previous
page
Suppliers
Concerns of supplier
network and delivering
materials
Situation
– Aware of risk and facing
similar situation
Behavior
– Coordinating with
supplier network to meet
supply agreements
Priorities
– Real-time monitoring of
inputs
– Daily updates to
manufacturers on stock
levels, inventory,
deliveries, and priorities
COVID-19
Manufacturer
Respond to shifting
demand with labor and
supply shortages
Situation
– Peaking demand for daily
essentials, stopping
planned deliveries for
others
– Different communications
with retailers
– Labor shortages
– Cross-regional bans on
transportation for inputs
Behavior
– Adjust workforce schedule
and daily tasks for
prevention
– Modify demand planning
to new work requirements
– Maximize and optimize
production of essentials
Priorities
– Safety first
– Meet customer demand
– Delivery to retailers
Retailers Consumers
Respond to increased Irregular purchasing
demand and supply behavior fueled by
shortages perception of threats
Situation Situation
– Labor shortages – Erratic demand of
– Risk of cross-regional products
transportation bans – Shifting priorities and
frequent updates from
Behavior
customers/retailers
– Change shopping
– Awareness of risk, panic,
journey to respond to
consumer needs, and recovery
including minimizing – Extended time at home
transmission risk Behavior
Priorities – Stockpiling and panic-
– Stocked shelves over buying
negotiated purchasing – Preference for online
terms retailers over physical
stores
Priorities
– Stock of daily essentials,
necessities, and key
pantry and household
items
– Communication
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 Lillian
Operations: there Overview of key considerations
Deep dives to follow
are key actions to
take across each – Different communication norms with commercial teams and higher frequency
of changes to orders
component of – Consumer prioritization of daily essentials over new and innovative products
your supply chain – Size of packaging to facilitate consumer purchase and transportation of greater
Plan volumes

– Shortages of raw materials and indirect inputs

– Increased demand of inputs for daily essentials
– Potential import and cross-region transportation bans
Source

– Potential labor shortages

– Ability of production lines to shift from one product to another
– Maintaining health and hygiene at facilities operating at full capacity
Make

– Shortages of labor for logistics services; insistence on touchless delivery

– Differing delivery needs of retailers dependent on allocation to DCs for online
purchase vs. physical stores
– Potential cross-region transportation bans
7 Deliver
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Plan Demand Supply planning— Supply planning— S&OP—emergency
planning suppliers production control tower

Inputs Inputs Inputs Inputs

– Confirm priority SKUs – Identify vital materials – Gather daily availability of vital – Demand plan, supply
for which you need materials from procurement plan, production plan
– Confirm priority
supply commits
customers – Identify crucial shortages for – Demand supply gaps
– Review previous procurement to work through and mitigating actions
– Confirm product
supply commits vs.
allocation logic – Gather daily capacity by line Activities
vital materials
including personnel and
– Assess changes in – Facilitate decisions and
– Monitor closures, equipment availability
forecast determine what can be
regulatory activity
– Obtain latest throughput by allocated downstream
– Secure POs
– Obtain latest demand line
– Manage exceptions
– Monitor daily plan
– Obtain latest forecast for the
replenishment and buying – Identify personnel
Activities plant at SKU, line, and daily
patterns needed to continue
levels
– Obtain supply commits operations
Activities
from suppliers Activities
– Confirm the team has
– Update current demand
– Identify gaps to forecast – Generate rough cut capacity access to needed
plan
plan for next 2–4 weeks by line planning tools
– Mitigate gaps where
– Push out SKUs that are
possible – Identify demand supply gaps – Cooperate with other
not vital
and crucial bottlenecks parties as needed
– Track and expedite
– Recommend edits to
shipments – Determine workarounds for Outputs
allocation logic where
availability issues
needed Outputs – Confirm plan
Outputs
Outputs – Confirm supply – Cascade decisions to
commits from suppliers – Publish rough cut capacity plan relevant parties
– Update demand plan for
next six months – Identify gaps to forecast – Collaborate with commercial on
and mitigating actions D-S gaps, allocation decisions
– Send forecast to supply
planning team – Generate and cascade – Collaborate with plants on vital
a new forecast to resource needs (for example,
Checklist of actions – Refine allocation logic
suppliers shifts, lines) and production
requirements (SKUs)
8 – Collaborate with procurement
on vital material needs
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Source Category
Commodity management
– Assess commodity risk and
establish capability for regular
monitoring
– Identify opportunities to share
gain or loss with suppliers
– Reduce demand and identify
alternate sources
Cost management
– Evaluate contracts to identify
demand impact and cancellation
or delay actions
– Identify in-year savings
opportunities
Category strategy
– Evaluate all RFPs in market,
stop start or modify approach,
issue communications
– Confirm strategic supplier
contacts
– Reprioritize project pipeline and
assess impact on projected
savings
– Assess impact on 2- to 3-year
category strategy
Checklist of actions
9
Supplier
Supply risk
– Contact high-risk and impact
suppliers and agree on supply
plan
– Segment suppliers and
corresponding supply chain by
level of COVID-19 risk
– Monitor regional markets and
government responses
– Model supply scenarios and
contingency plans
– Monitor financial stability of vital
suppliers
Social responsibility
– Partner with strategic supplier to
mitigate impact on employees
and communities
Shifting supply
– Execute rapid sourcing for
incremental needs
– Identify new supply
requirements (for example,
increase in e-commerce, virtual
work needs)
– Identify suppliers to reduce or
eliminate
Team
Resource management
– Confirm safety and working
conditions for all team members
– Stagger working times
– Establish command center to
address immediate needs
– Evaluate and update
performance evaluation
processes
– Determine new capabilities
required (for example, category
expertise, rapid sourcing, online
negotiation)
Tools and technology
– Identify tools needed to perform
virtual work effectively (for
example, negotiations, RFP
review and evaluation)
Operational procurement
– Ensure viability of business-
critical processes (for example,
P2P)
– Identify new escalations,
expedite rules required
– Evaluate location of resources
and impact on productivity
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Make Incoming raw materials
Inputs
– Identify vital raw materials and
packaging for which you need
supply commits
– Review supply risk based on
geographic areas due to closures,
regulatory activity
– Obtain latest demand plan
– Confirm transport providers
agreements
Activities
– Obtain supply commits from
suppliers
– Identify gaps to forecast
– Determine alternative sources of
raw materials and packaging
– Mitigate gaps where possible
– Track and expedite shipments
– Identify alternative transport
Outputs
– Confirm supply commits from
suppliers
– Identify gaps to forecast and
mitigate with alternate inputs or
suppliers
Checklist of actions – Generate and cascade a new
forecast to suppliers
10
Production
Inputs
– Gather daily availability of vital raw
materials from procurement and
identify crucial shortages to work
through
– Gather daily capacity by line
including personnel and equipment
availability
– Obtain latest throughput by line and
forecast for the plant at SKU, line,
and daily levels
– Review assets’ maintenance
activities and spare parts
Activities
– Generate rough cut capacity plan for
next 2–4 weeks by line
– Identify demand supply gaps and
crucial bottlenecks
– Determine options for availability
issues
– Prioritize vital assets for maintenance
and spare parts
Outputs
– Publish rough cut capacity plan
– Collaborate with commercial on D-S
gaps, allocation decisions
– Collaborate with plants on vital
resource needs and production
requirements
– Monitor vital material needs
– Analyze maintenance tasks and
reallocate to production team
Finished goods
Inputs
– Confirm priority SKUs
– Confirm priority customers
– Confirm product allocation logic
– Assess changes in forecast
– Secure POs
– Monitor daily replenishment and
buying patterns
Activities
– Update current demand plan
– Push out SKUs that are not vital
– Recommend edits to allocation logic
where needed
Outputs
– Update demand plan for next six
months
– Send forecast to supply planning
team
– Refine allocation logic
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Deliver Distribution planning—
DCs and drivers
Inputs
– Gather daily updates of DC
personnel, space, and equipment
availability
– Gather daily updates on drivers,
availability
– Update stocking policy and
updates to latest requirements
– Obtain latest forecast for the DC at
SKU and daily levels
Activities
– Develop DC shift schedules for 2–4
weeks
– Develop driver routes for the next
week
– Identify crucial bottlenecks
Outputs
– Propagate orders to warehouses
– Determine which routes are
delivered by which warehouses
– Build and publish routes of the
routes
– Collaborate with commercial teams
on supply gaps, allocation
decisions
– Collaborate with plants on shipping
Checklist of actions schedules
– Collaborate with 3PLs and logistics
11 providers on vital supply gaps
Warehousing
Capacity
– Monitor capacity and productivity
– Optimize DC capacity by prioritizing
vital SKUs
– Evaluate need for temporary
closure of any DCs
– ID and ramp contingency options
(alternate DCs, temporary storage,
DC bypass, shared use options)
and expedite qualifications
Labor
– Assess additional and excess labor
requirements
– Explore market dynamics to recruit
or place temporary labor
– Maintain open dialog with unions on
a continuous basis
E-commerce
– Forecast e-commerce-related need
for each picking
– Draw up temporary plans for
picking and staging areas in DCs
Transportation
Modes and routing
– Monitor metrics to detect issues
early (for example, load
acceptance)
– Change to faster modes where
needed, and pre-book capacity
– Build routes earlier to provide
visibility to carriers and operations
– Explore dynamic routing based on
daily changes to demand and
production
– Explore shared use options to take
advantage of freight capacity
– Reduce delivery frequency to
maximize capacity utilization
Labor
– Assess additional and excess labor
requirements for private or
dedicated fleet
– Explore market dynamics to recruit
or place temporary labor
– Maintain open dialog with unions on
a continuous basis
E-commerce
– Forecast e-commerce-related need
for last mile assets
– Draw up routing plans for shipping
from DCs, stores, and dark stores
– Discuss consumer policy changes
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page
Ensuring proper
workforce COVID-19
management is
paramount to
stakeholder safety Safety Business continuity Morale
and business Managing travel Enabling employees to Managing through
requirements and the remain productive stress and uncertainty
continuity spread of infection

Objectives Objectives Objectives

– Prevent the spread of – Adjust ways of working to – Help employees manage
infection enable employees to work personal well-being,
– Support infected in a safe manner with stress, mental health, and
employees minimal business anxiety
– Help overseas disruption Priorities
employees return home Priorities – Provide regular updates
– Manage urgent travel – Reconfigure onsite work demonstrating readiness
needs to mitigate health and and encouraging calm
Priorities safety risks – Prevent social isolation by
– Identify infected – Provide tools and moving to virtual
employees technology for remote interactions
collaboration and flexible – Lead by example and
– Ensure access to hours for caregivers
medical treatment encourage physical and
– Ensure frequent mental wellness through
– Enable remote work and communication and easy remote work
social distancing access to information
– Sanitize facilities

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Human capital: Overview of key considerations
Deep dives to follow
there are key
actions to take to – How will you identify infected employees and mitigate further spread?
– How will you support infected employees in accessing treatment?
ensure the safety – How will you identify and support employees traveling abroad and manage
and security of Emergency urgent travel needs?
your workforce response

– How will you remain up to date on the latest credible information?

– How will you provide regular updates and gather feedback and questions
from employees?
Communications – What tone will you set and how will you communicate with one voice?

– What policies and procedures need to be temporarily adjusted?

– What policies require immediate changes vs. trigger points?
– How will you manage exceptions as they arise?
Policies and
procedures

– How will you enable employees to remain productive while working from
home?
– How can you account for employees’ caregiving and other personal
responsibilities?
13 Remote work – How do you maintain employee morale and motivation through this situation?
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Human capital Emergency Communications Policies and Remote
response procedures work

Infection management Credible real-time info Assess Capabilities

– Provide testing access – Establish daily – Review all sick, – Assess gaps in tech and
and/or information monitoring and vacation, disability, tools required for remote
notifications from contractor, and visitor work and define how
– Establish contacts for
trusted sources (for policies employees can
infected employees and
example, WHO, supplement
notify at-risk employees Temporary adjustments
government)
Priorities and
– Provide guidelines on – Waive notification,
Frequent updates expectations
social distancing, waiting clauses, and
symptoms, and hygiene – Provide regular updates return-to-work clauses – Identify activities to
on the situation and move to virtual vs.
– Assess janitorial and – Determine policies to
company response postpone vs. cancel (for
disinfection protocols flex (for example,
example, training, team
– Establish internal site to encourage employees
– Reconfigure onsite work meetings)
consolidate information to stay home on
to enable social
becoming symptomatic) – Define company and
distancing – Equip managers with
team norms for working
information and talking – Allow negative sick
Treatment hours, deadlines,
points leave balance as
responsiveness
– Work with benefits needed (doctor
Listen to employees
providers on appropriate prescribed) and extend Flexible hours
and flexible care and – Use HR BPs for “boots- sick leave for
– Enable employees to
provide easy access on-the-ground” feedback dependent care
choose hours based on
Travel – Establish channels for – Define immediate vs. caregiving and other
employee questions and trigger point needs
– Monitor global travel
feedback adjustments
restrictions daily Healthy working
Set the tone Managing exceptions
– Provide travel guidelines – Encourage managers to
and establish triggers – Be transparent about – Establish a process to check in with employees
for changes what is known and manage exceptions (for personally
unknown example, an employee
– Identify employees – Role model healthy
is stranded abroad or
traveling abroad and – Encourage calm and working habits (for
refuses to work)
Checklist of actions support repatriation of demonstrate readiness example, breaks, social
stranded employees connection)
14
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We are here to help
Bob Haas Greg Portell
Partner, Board Member Partner – Consumer Industries and Retail Lead
robert.haas@kearney.com greg.portell@kearney.com
New York Chicago

Steve Mehltretter Steve Berger

Partner – Operations Partner – Private Equity and M&A
steve.mehltretter@kearney.com steven.berger@kearney.com
Toronto New York

Evan Gutoff P S Subramaniam

Partner – Transformation Services Partner – Operations
evan.gutoff@kearney.com ps.subramaniam@kearney.com
Boston Dallas

Mark Clouse Todd Huseby

Partner – Procurement Partner – Health
mark.clouse@kearney.com todd.huseby@kearney.com
New York Chicago

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