Treasury in Practice Guides

Agile Business Continuity: Keeping Operations Running in Unprecedented Times

Underwritten by Kyriba

Guide-20-TIP-AgileBusinessContinuity-PgHdr

In times of crisis, companies turn to their business continuity plans to keep operations running. However, as treasury departments have found out during the ongoing coronavirus pandemic, many plans didn’t account for a crisis of this magnitude. In this Treasury in Practice Guide, underwritten by Kyriba, we’ll look at how even the strongest business continuity plans often need to be adjusted once a crisis hits. By adapting your plan accordingly, you too can remain operable—in the current crisis, and the next one.

Download the Guide

KY20-027-Active-Liquidity-Ad-2-Ad-AJ-v2

Chapter Highlights of the AFP Guide Agile Business Continuity: Keeping Operations Running in Unprecedented Times

1 Introduction

In this Treasury in Practice Guide, underwritten by Kyriba, we’ll look at how even the strongest business continuity plans often need to be adjusted once a crisis hits. By adapting your plan accordingly, you too can remain operable—in the current crisis, and the next one.

2 Revisiting Your Plan

Many business continuity plans that companies had in place took into consideration natural disasters or technical difficulties like power outages, but had not considered events like global pandemics.

“I think the expectation was that you would always have the ability to relocate to maybe to another facility on a temporary basis. But to have a situation where people can’t be around other people—I don’t know if that was ever anticipated.”
- Bruno Fernandes, Deputy CFO and Treasurer for the Government of Washington, D.C

3 Changes to Work Processes

Since the start of the crisis, AFP has reached out to our members to see how they are addressing it.

“I think there’s a lot of nervousness out in the marketplace on how companies are weathering this and how this is going to ultimately impact employees. So lots of communication is always important to keep folks focused on doing the job and to take out some of the nervousness.”
-Bob Whitaker, CTP, Senior VP of Corporate Finance for DHL, AFP Chairman

4 Updating and Testing Technology

Working from home also can put a strain on technology and systems, and companies need to plan accordingly. Because of such, companies should put their systems through rehearsed and unrehearsed testing.

5 Securing Liquidity

A recent whitepaper from The Hackett Group recommended that companies tap into excess cash within current working capital management practices to support the supply chain. These include:

  1. Tightening up accounts receivable processes by strengthening collections
  2. Introducing liquidity mechanisms, such as payment terms and financing solutions for smaller customers and suppliers
  3. Monitoring daily demand fluctuations and supply limitations closely to make sure cash isn’t invested in the wrong inventory

Since the start of the pandemic, the Federal Reserve has made substantial efforts to support the economy, unveiling multiple facilities that will give corporates greater access to much needed credit. The Fed’s Coronavirus actions include:

  1. The Money Market Mutual Fund Liquidity Facility (MMLF)
  2. The Primary Market Corporate Credit Facility (PMCCF)
  3. The Secondary Market Corporate Credit Facility (SMCCF)
  4. The Term Asset-Backed Securities Loan Facility (TALF)

6 Travel Policies

It is essential to have a BCP policy of monitoring any areas where your employees might visit and restricting access accordingly. Using the current climate as an example—a global pandemic—your plan should restrict all travel.

7 Testing Security

Fraudsters never let a crisis go to waste and many have been exploiting the panic surrounding the coronavirus pandemic. According to the 2020 AFP Payments Fraud and Control Survey, business email compromise (BEC) was the most reported type of attack organizations experienced. Because of such, Treasury professionals should be vigilant in their online activity, attending anti-phishing and BEC scam training, and using their organizations VPN amongst other protective measures.

8 Returning to the Office

Returning to work will likely look different from company to company and from industry to industry. Given the nature of pandemics and the threat of a resurgence, it may benefit an organization to consider a phased approach to continue working remotely, or rotationally, for some time even as the curves begin to flatten.