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How Companies Can Respond to the Coronavirus

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How Companies Can Respond to the Coronavirus

The companies and employees at ground zero of the COVID-19 outbreak provide insight into what works in a time of crisis — and what doesn’t.

MIT Sloan Management Review,

5 min read
4 take-aways
Audio & text

What's inside?

Businesses can learn from China’s experience coping with the economic fallout of the COVID-19 crisis. 

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8

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Recommendation

As the world faces the coronavirus pandemic’s impact on business and the economy, companies coping with the economic fallout in China offer worthwhile, applicable lessons. European university-based researchers developed a set of best practices derived from the Chinese experience, and summed them up in the MIT Sloan Management Review. Their findings offer a helpful starting point for business leaders adjusting to this new reality.

Summary

The COVID-19 outbreak and government-mandated mitigation measures have had a severe impact on the Chinese economy.

The Global Center for Entrepreneurship and Innovation at the University of St. Gallen in Switzerland analyzed satellite data on air pollution emissions. They sought to identify changes in manufacturing activity in those parts of China most affected by the virus outbreak. The areas nearest the epicenter of the pandemic showed the greatest reduction in emissions.

In the industrial areas around Wuhan City, emissions dropped by up to 85%. Average emissions reductions across China between January 24 – when mandated quarantines began in Hubei Province – and February 21, 2020 were 38%.

That drop in activity translates into at least $215.6 billion in losses for the manufacturing sector. This does not reflect the pandemic’s impact on other Chinese businesses nor losses incurred moving up supply chains as sourcing companies struggle to find alternate suppliers and fall behind...

About the Authors

Michael Hudecheck of Switzerland’s University of St. Gallen; Charlotta Sirén of Brisbane’s University of Queensland; Dietmar Grichnik of St. Gallen’s Institute of Technology Management; and Joakim Wincent, a professor at St. Gallen and at Helsinki’s Hanken School of Economics all conduct research on entrepreneurship.    

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