Pandemic Response: Risk Planning in Times of a Crisis

Abstract

The COVID-19 crisis caught many economic players unprepared and unable to act. Little research has been conducted on its impacts and reasons for the lack of appropriate countermeasures. This paper investigates the progress of the crisis and analyzes potential reasons for the emergence of unsatisfactory risk management. It gives advice for companies on how to cope with the situation best. In addition to the current situation, two past crises as well as the contrary strategies of two companies were examined with the aim of drawing sensible conclusions towards their strategies of managing risk. Modern methods with a strong focus on data-driven examination lead to one-dimensional approaches that are unable to reflect complex interrelations. The paper concludes that existing risk management systems are already set up in a comprehensive way and that the main issue lies within behavioral patterns of individuals who are either unable or unwilling to see existing risks. This leads to situations in which risks are identified, though concurrently ignored in subsequent decision-making processes.