Strengthening resilience is the key to success in 2021, says PwC’s Global Crisis Survey with Indonesia update

Jakarta, 29 April 2021 - A crisis can be catastrophic to your business — or it can reveal the strength, quality, and resilience of your organisation.

One year after COVID-19 was declared a global pandemic, PwC’s second Global Crisis Survey looks at the worldwide business community’s response to the most disruptive global crisis of our lifetime. More than 2,800 business leaders shared data and insights, representing organisations of all sizes, in 29 industries and across 73 countries (including Indonesia).

PwC’s Global Crisis Survey 2021 is the second to be held, after the first survey was issued in 2019. It is an assessment of the global business community’s response to unprecedented social, economic and geopolitical disruption. The survey, represented by 112 of Indonesian business leaders, reveals observations and creates a compelling portrait of the tactics, tools and processes organisations put in place, and what’s worked, what hasn’t and why.

The past year has underscored that the challenge of crisis management is not about predicting the future but dealing with the unpredictable. Businesses must focus on building a foundation of resilience to weather whatever comes next.

Preparation, agility, an integrated crisis response plan and resilience have been essential as organisations continue to deal with the crisis
More than 70% of global respondents, including Indonesia, said their business was negatively affected by the pandemic and 20% said the crisis had a positive impact overall on their organisation. Organisations that fared well were more likely to rely on a dedicated crisis team to drive their response to the crisis. Technology and healthcare organisations were more likely to be positively impacted, while travel and hospitality sectors suffered the most negative effects of COVID-19. Organisations that fared well were more likely to rely on a dedicated crisis team to drive their response to the crisis.

Workforce, operations and supply chain, and finance and liquidity are the most heavily impacted areas with the similar responses from Indonesian and global respondents.

“As global organisations assess their response to the pandemic, the survey data and insights provide a compelling roadmap for rethinking and strengthening resilience capabilities,” said Kristin Rivera, Global Crisis Leader at PwC US. “All eyes are finally looking toward the future. Learning from how businesses responded to the crisis is an important first step toward building the right foundation for what's next. Crisis planning, resilience programs and the protection and consideration of physical and emotional needs of their employees are all integral parts to preparing for the inevitable.”

PwC’s global survey reveals that, even with a well-defined crisis team, organisations need an agile crisis management program that can adapt to address various types of disruption. Only 35% of organisations had a crisis response plan that was ‘very relevant’, which means the majority of organisations didn’t design their plans to be ‘crisis-agnostic’ — a hallmark of a resilient organisation.

Paul van der Aa, PwC Indonesia Forensics Advisor, says that, “Compared to Global (7/10), eight out of ten organisations in Indonesia reported that they’re planning to increase their investment in building resilience through crisis management, business continuity and emergency planning. Even among risk leaders, that number is as high as nine in ten. There’s plenty of room to run, only 22% of our respondents felt their various crisis management functions are very well integrated.”

In this unprecedented time, organisations take an important action to focus on employee’s wellness in response to COVID-19. From moving to remote work and implementing safety protocols, to assisting workers with personal hardship, organisations put the spotlight on supporting health and safety. The ability to adapt, and to manage fundamental shifts in the way we live and work is at the heart of individual and organisational resilience.

Respond to crisis and beyond
As an impact of the pandemic, companies must accelerate transformations in certain areas and deprioritise them in other areas. On the employment side, remote working was the most common change implemented, while many organisations have been forced to carry out headcount reductions. Interestingly, 50% of Indonesian respondents have made remote working a permanent option for their employees, while only 39% of global respondents set up permanent remote working.

Data tools and capabilities are critical, particularly as remote work feeds the need for clear decision-making channels and fuels the risk of cyber attacks. 90% of Indonesia respondents (75% globally) said technology has facilitated the coordination of their organisation’s crisis response team.

Almost 70% of Indonesian respondents stated that they have conducted a formal “after action” review of its response to COVID-19, whereas only 49% globally respondents indicated to have carried out such a review.

According to Indonesian respondents, the top five crisis concerns are global health pandemic, technology disruption, cybercrime, competitive or marketplace disruption, and financial or liquidity.

Emerging stronger from disruption.
More than 95% of business leaders, both in Indonesia and globally, reported that their crisis management capabilities need improvement. In order to design a strategic crisis response plan, firstly, companies should appoint a crisis response team that can align the crisis plan with company strategy, goals and purpose; and focus on continuous improvement and building an integrated resilience programme.

Additionally, companies need to understand that an integrated program is essential to executing a successful crisis response and to building resilience. Think holistically about how to build resilience. Begin to break down the silos and integrate core resilience competencies.

Organisational resilience is critical — not just to succeed, but to survive. Organisations have to elevate resilience with the organisations, set strategic priorities, begin to foster a culture of resilience, and examine the crisis response across organisations.

In PwC’s 24th Annual Global CEO Survey, published earlier this month, a record-high 76% of CEOs believe global economic growth will improve in 2021. That optimism aligns with PwC’s Global Crisis Survey 2021 data, where three out of four companies are confident they can successfully integrate what they’ve learned during the crisis and invigorate their organisational resilience.

To close, Paul says, “As a lesson learned, Indonesian respondents change their corporate strategy and sales channels are in the top three priorities of the planning to make. Business leaders recognise that a foundation of resilience can make the difference between faltering or flourishing. As the post-pandemic period begins to take shape in the coming months, organisations have an opportunity to reimagine opportunities for the future. Crisis can be a powerful catalyst for positive change.”