The coronavirus that emerged in China is now shaking the world economy – including some major U.S. companies – and stoking fears of a global recession.
But, as companies go about mitigating damage, there are lessons they can learn to be better prepared for another rare worldwide crisis, says Hitendra Chaturvedi, a professor at the Supply Chain Department of W.P. Carey School of Business at Arizona State University and an expert on global supply chain sustainability and strategy.
“The coronavirus is an abnormal occurrence,” Chaturvedi says. “Businesses cannot completely insulate themselves from such events, but they can certainly reduce risk so it will hurt but not be life-threatening. The whole idea is, what is the strategic insurance policy against such unexpected events, and what is the cost businesses are willing to bear?