BCG Perspectives
Facts, scenarios, and actions for leaders
Publication #3 with a focus on Emerging Stronger from the Crisis

Version: 24 April 2020

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

COVID-19

COVID-19

BCG Perspectives

COVID-19 is a global
societal crisis

Leaders need to drive an integrated
response to navigate the crisis

We at BCG believe that the COVID-19 outbreak isfirst and foremost a societal crisis, threatening lives
and the wellbeing of our global community. Society
now, more than ever, needs to collaborate to protect
people's lives and health, manage mid-term
implications, and search for lasting solutions.

It is the duty of health, political, societal, and businessleaders to navigate through this crisis. A complex
interplay of epidemic progression, medical response,
government action, sector impact, and company actionis playing out. This document intends to help leaders
find answers and shape opinions to navigate the crisisin their own environments. It encourages thinking
across the multiple time horizons over which we see
the crisis manifesting itself.

Source: BCG

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Objectives of this document

Executive Summary | COVID-19 BCG Perspectives

Impact on economy, sectors, and business remains severe in 2020; rebound to pre-crisis levels not expected by end of 2021
• Length of 'Fight' phase dependent on many unknowns; accelerated movement toward vaccine or treatment at scale could limit 'Fight' phase to 12-24
months; data from therapeutics will emerge in a few months—drugs likely to reduce severity of infection• Estimating the economic, sector, and business impact requires scenario-thinking to navigate the crisis• Current consumer sentiment suggests some willingness to resume activities post lockdown but not to pre-crisis levels (even with treatment)• Economic forecasts point to severe downturn in 2020—global rebound to pre-COVID levels not expected before 2021
• Total shareholder returns (TSR) have rebounded over the last 20 days, most sectors still hit; there are clear winners even in hard hit sectors
To emerge stronger from the crisis requires fast, decisive action; business leaders need to concurrently think across multiple time horizons• To navigate through the crisis, leaders can leverage real-time, high-frequency, leading indicators to understand patterns and societal shifts• Experience from prior crises suggests that winners innovate to accelerate out of crisis and seek bold moves, e.g. M&A• We recommend nine action areas to business leaders that allow companies to emerge stronger• 'Winning the Fight' improves odds to also 'Win the Future'

We believe during this crisis, leaders need to think along two dimensions:
1 Taking an integrated perspective on health/medical progression, governmental responses, societal reactions,and economic implications to understand business/sector impacts and2 Thinking multi-timescale (the now, near, and long-term future—in a flatten-fight-future logic).
Source: BCG

2

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Many countries are starting to establish preconditions for a controlled restart, as COVID-19 continues to be a global challenge to societies• Governments' actions and societal adherence continue to deliver results in flattening the curve; allowing us to consider relaxation of lockdowns• However, health care capacity (e.g. masks) and testing (e.g. currently unreliable serology) remain major issues• Business preparation (e.g. health protocols; workplace safety) and public response (e.g. revised social norms) are key to ensure a sustainable transition

COVID-19 will be a journey with three distinct phases requiring
an integrated perspective
Fight

FutureTypically the initial phase after a pandemic
outbreak – goal is to urgently limit numberof confirmed cases, especially critical care

Finding paths to collectively fight the virus,
restart the economy, and support society inbalancing lives and livelihood

Disease controlled through vaccine/cure/herd immunity, and treatment withinsustainable medical capacities possible

Social distancing (lockdown) and partial businessclosures outside a few, lead to economic
recession with large employment impact

Moderate economic activity with recovering
GDP, some business reopenings, and social
distancing on sustainable level

Reactivated economy with strong businessrebound and job growth, social restrictions
limited or completely suspended

1. Disease progression, health care system capacity, and response
2. Government policies and economic stimulus
3. Economic scenarios
4. Business engagement and response
5. Public engagement and response

All of the above five factors result in specific economic and social outcomes in each phase
Source: BCG

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Flatten

1

COVID-19 Progression and Response
Disease progression and health care capacity

2

Economic and Business Impact
and Scenarios
Economic response
Scenarios and key drivers

3

Guide for Leaders
Principles for leadership
Navigating businesses through uncertainty
Emerging stronger
4

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Government policies and action

COVID-19 pandemic spread: Cases doubling every ~20 days1 globally

DISEASE PROGRESSION &HEALTH CARE CAPACITY

As of 23 April 2020

UK

USA

Italy

China
Iran

16th Apr'20

23rd Apr' 20

10
8
days
days

15
days

20
days

Japan
South
Korea

India

9th Apr'20# of days of doubling1 the cases globally

354k

542k

738k

Days of doubling cases:
0-3 days

183
Countries with cases2

3-6 days

6-14 days

2.7M[∆4%]3

Confirmed cases globally

14-30 days

191k

Total # of recoveries>30 days

59

65

66

[∆5%]3

Fatality globally

Note: Continued cases and fatalities are subject to different testing, propensity, reporting standards and hence imperfect measures
1. No. of doubling days based on 7 day CAGR 2. Basis Johns Hopkins CSSE ; 3. Daily growth rate basis 7 day CAGR
Sources: Johns Hopkins CSSE, Our world in data, WHO situation reports, BCG analysis# of countries with >1k active cases

5

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

FranceSpain

DISEASE PROGRESSION &HEALTH CARE CAPACITY

The week that was…

April 20, 2020

A critical shortage of swabs and other testing
components is, in many cases, making it impossible forlabs across the country to expand their capacity.

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

From 18 to 23 April 2020

DISEASE PROGRESSION &HEALTH CARE CAPACITY

Leaders need to get the preconditions for Restart rightPublic/economic readiness

Diseaseprogression
and impact

Health carecapacity

Virus
monitoring
systemBusiness
preparation

Publicresponse

Government
preparation

Control of virus impact
in terms of case growthrate, environmental
factors1, and disease
impactAdequate supply of
hospital beds,
ventilators, ICUs, PPE,
trained staff, newtreatments

Widespread andprivate virus testing;contact tracing, tracking,and isolation

Workplace healthprotocols and businessreadiness

Training and availabilityof hygiene products
and PPE; civil
awareness, compliance
rates

Leadership capacity,
Policy framework for
public health, sectors,
and economy

Leading indicator thatmeasures are effective,
public health isprotected

Capacity sufficient tocare for COVID-19 andother healthneeds

Testing to inform
decisions, resource
allocation, and outbreakresolution

Businesses ensure
workplace safety for
those returning to
work

Public educated andempowered to adhere to
guidelines, to play rolein containment;
societal response2

Leadership capacity anddecision-making on
policy; clear guidanceand expectations

1. Environmental factors: population density, demographics (age, health conditions), weather, etc.; mixing from other localities
2. Societal behavior: physical distancing, gatherings, intergenerational living, mass transit usage, shopping behavior, etc.
Source: BCG analysis

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Health care readinessDisease progression | Many countries currently flattening the curve

DISEASE PROGRESSION &HEALTH CARE CAPACITY

As of 22 April 2020
Total cumulative number of confirmed cases (log scale)20%

1,000,000

Singapore5

15%

Cases
doubling:
8 days10%

AfricaJapan
CanadaNetherlands UK
SwedenPortugal
Austria Switzerland Germany

Iceland Norway
South Korea

Fight

0%
1,000
AfricaBelgium
FranceCases
doubling:
14 days

US

Spain
Italy
Iran Greater China

10,000100,000
1,000,000
Cumulative number of confirmed cases (log scale)

Asia1

Central & South America4

Spain Italy
Germany
FranceChina
IranBelgium
Switzerland
Netherlands
Portugal
Austria

10,000South Korea

UK

BrazilCentral & South America

5%US

100,000

RussiaIndia

Countries2 with doubling rate > 14 days

EuropeNorth America

NorwaySwedenIceland

1,000

100

0

10

20
Asia1

30
Europe40

50
60
Number of days3
NA

1. Includes Middle East 2. Countries selected from the chart on the left 3. # of days after exceeding 100 confirmed cases 4. Excludes Brazil 5. Singapore observed a steady decline in growth rate of cumulative
cases from 22 Mar to 6 Apr post which the rate has mostly increased as of 22 Apr 2020. Source: Johns Hopkins CSSE, Our World in data, WHO situation reports

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Rates improving from top to bottom

Flatten

Daily growth rate of total cases (seven-day average)

DISEASE PROGRESSION &HEALTH CARE CAPACITY

Disease progression | Governments actions are delivering results# of countries

Close
schools

Close
workplaces

Cancel public
eventsClose public
transportation

Public info
campaigns

Restrict internal
movement

International
travel controls

18

19

9

10

7

16

8

Daily growth rate

60%
50%
40%
30%
-29pp.

Median25th percentile-5pp.

Day 28Day 14

Day 0

-8pp.

Day 28Day 0

Day 28Day 14

-6pp.

Day 0

Day 14

Day 0

Day 28Day 14

Day 28-6pp.

-10pp.

Day 0

Day 14

Day 0

Day 28Day 14Day 0

75th percentile

Day 28

-7pp.

-9pp.

-24pp.

-20pp.

-16pp.

10%0%-19pp.

-21pp.

Day 14-20pp.

20%

Days since measure implementation

Note: "Day 0" reflects day measure was taken in each country and can vary across measures; daily growth rate of reported infections based on compound growth in 3-day window prior to date; Chinese province of Hubei
considered as separate country for purpose of presentation; correlations between effects of measures not taken into account; threshold of 100 cases at date of measure introduction used per measure, not across measures
Countries (ISO 3166-1 alpha-2): AT, BE, BR, CH, CL, CN (Hubei), CZ, DE, ES, FI, GR, ID, IL, IN, IQ, IR, IS, IT, JP, KR, MY, NO, PK, PT, QA, SE, SI, TH, US, ZA
Source: Oxford COVID-19 Government Response Tracker, Johns Hopkins University CSSE data, BCG analysis

9

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Up to 15 Apr 2020

Health care capacity | To support broader usage of masks,
different countries planning ramp-up of production

DISEASE PROGRESSION &HEALTH CARE CAPACITY

As of 23 April 2020

Illustrative: Modeled* for a country with 100M population
PPE: Masks

Groups affected &usage description
Examples of where
guidance is adopted

Public facilities& patients

Vulnerable groups& patients

Essential workers& patients

Optional daily use
for general public

Mandatory daily use
for general public

Anyone using public
facilities (e.g. shops,
transport)

Recommended use
for vulnerable people
leaving home

Any worker going into aworkspace with others

Recommended but
optional use for anybody
leaving home

Required use for anybody
leaving home

Austria

China

USA

USA6

China

USA

Czech Rep.

MoroccoMongoliaJapan

S Korea

India6Japan

S Korea

Slovakia

TurkeyNo. people affected
per month (M)

391

352

203

100

100

Total masks/
month (M)4,5

18

34

154

85

180

NB: Analysis above is for 'population masks' and not those that are FDA or FDA EUA approved for health care workers interacting with COVID-19 patients*Model has been built with US as a representative country and can be used as a near base case for developed countries
1. Brookings (2020); 2. Assumes one member of household goes shopping/to pharmacy 5x monthly –Census.gov (2020); 3. KFF (2020); 4. No of masks needed per person daily assumed to 1 for Public facilities & patients,
Vulnerable groups & patients, Optional daily use for general public, Mandatory daily use for general public; and 4 for Essential workers & patients; 5. Assumes that 50-60% of people go out daily, 50% of general population
will wear masks & 70% of vulnerable population will wear masks; 10% buy surgical masks instead of using homemade face coverings; 6. For selected states

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Range of potential recommendations

DISEASE PROGRESSION &HEALTH CARE CAPACITY

Virus monitoring | Testing continues to be a pressing issue
As of 22 April 2020

Testing-to-cases ratios differ widely
Total #of cases(000')

Cumulative # of tests per million population

0.3

53

3.5

11

20

1.7 146 11 184 825 204 129 117# of tests administered per reported case(based on cumulative average)
41

20
14

Apr 01

11

8

5

4

3

2
FranceSuccessful benchmark
countries with ratio >20

24 23

UK

27

Spain

30

Apr 22

US

662

Note – 1. Non-exhaustive list
Source: World Bank, Worldometers.info, Our World in Data, Johns Hopkins

Italy

Japan

Germany

IcelandIndia

S. Korea

S. Africa

RussiaVietnam

Cumulative # of cases per million population

11

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Countries1 are continuing to ramp-up testingVirus monitoring | Currently available serological tests
too unreliable to provide strong solution

DISEASE PROGRESSION &HEALTH CARE CAPACITY

As of 17 April 2020

Illustration: Implications of Accuracy for Covid-19 Testing
Base data: 100,000 tests performed1; 5% disease prevalence

1"Gold standard" molecular tests
provide the most accurate detection of
the virus genetic material (RNA),
typically from respiratory swabs, and can
detect the virus before symptoms appear

2
Serological tests
detect the human immune response to
the virus ~1 week from when symptoms
appear; many "rapid" serology tests
launched vary significantly in accuracy
relative to molecular tests

Misdiagnosed
infectious people
do not isolate
and propagate
infection further

Sick patients = 5,000

Healthy patients = 95,000

False Negative Patients(sick patients misdiagnosed negative)

False Positive Patients(healthy patients misdiagnosed positive)

100

Current Molecular "goldstandard" test for COVID-19
Sensitivity 98%
Specificity 99%
Detection ~2-4 days before
symptoms

1000

Rapid finger-stick serology"high quality"
Sensitivity 80%
Specificity 90%
Detection ~6-10 days after
symptoms

3,500

Rapid finger-stick serology"low quality" 2
Sensitivity 30%
Specificity 60%
Detection~6-10 days after
symptoms

950

9,500

38,000A positive serology
test result (true or
false positive) thatsuggest an active
COVID-19 infection
will need a
confirmatory
molecular test

1. Roughly equivalent to US nationwide daily throughput as of March 31, 2020 2. The Guardian ("Coronavirus test kits withdrawn in Spain over poor accuracy rate", March 27,2020); Source: Expert interviews, BCG analysis. Note (i): Serology tests detect active COVID-19 infection starting ~6-10 days after symptoms appear (IgM earlier, IgG later), or
previous exposure to the virus (IgG only); Note (ii): The situation surrounding COVID-19 is dynamic and rapidly evolving on a daily basis. Although we have taken great care prior to
producing this presentation, it represents BCG’s general view at a particular point in time. This presentation is not intended to: (i) constitute medical, legal or safety advice, nor bea substitute for the same; nor (ii) be seen as a formal endorsement or recommendation of a particular response. As such you are advised to make your own continued assessments
as to the appropriate course of action to take, using this presentation as general guidance only. Please carefully consider local laws and guidance in your area, particularly the mostrecent advice issued by your local (and national) health authorities, before making any decision.

12

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Two test types available for
Covid-19 that differ in what theydetect and how well they detect

Business preparation | Business readiness across health protocols andworkplace safety key to ensure smoother transition during Restart

Face
Face
masks
masks

DISEASE PROGRESSION &HEALTH CARE CAPACITY

SpecialSpecialcleaning
teams
cleaning
teams
Revised social
norms
Revisedsocial norms

Remoteworking
Remoteworking

ThermalimagingGood morning!

Physical separation

John Doyhle(e.g. non-overlapping
shifts)Non-overlapping
TEMPEARTURE
OK
DO YOU FEEL SICK?

Thermalimaging

shiftsCopyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Hand
Hand
sanitizer
sanitizer

Tracking&Trackingtracing& tracing

Paid sick
Paid sickleave
leave
13

1

COVID-19 Context and Development
Disease progression, health care system capacity, and response

2

Economic and Business Impact
and Scenarios
Scenarios and economic impact
Business implications

3

Guide for Leaders
Principles for leadership
Navigating businesses through uncertainty
Emerging stronger
14

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Government policies and action

'Flatten'

Negative economic impact during 'Flatten' depends on LENGTH of
suppression and DEPTH of economic drop
Understanding of countries' sector composition critical to estimate
direct negative economic impact of reduced contact
Accelerated movement toward vaccine or treatment at scale could limit'Fight' phase to 12-24 months'Fight'Development in China gives a first idea on what LEVEL of recovery the
economy can achieve
Current consumer sentiment suggests some willingness to resume activities
post lockdown, but not to pre-crisis level even with treatment
Economic forecasts point to severe downturn in 2020—
global rebound to pre-COVID levels not expected before 2021

ImpactTotal shareholder return (TSR) has rebounded over last 20 days but impact
visible across many sectors; no sector above pre-crisis level across regions
While all sectors are affected by the downturn there is a large spreadwith some winners within each sector

Source: BCG

15

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Economic andBusiness Impact
and Scenarios

Scenarios and potential outcomes driven by five key questions

SCENARIOS ANDECONOMIC IMPACT

As of 24 April 2020

Illustrative

FlattenFight

Economic
activity
100%

Restart

Cure

1a

2a
3
2b

Potential pathways

1b

Critical carepatients

Five questions
will shape theeconomicoutcomes

Source: BCG

What will be the LENGTH of "Flatten"?
1a What are the preconditions to transition?
When will we achieve them?

1b

To what DEPTH does the economy
drop in "Flatten"?

What will be the LENGTH of "Fight"?
2a What are the preconditions to transition?
When will we achieve them?

2b

What LEVEL of recovery does the
economy achieve in "Fight"?

Where does the
3 economy return torelative to the preCOVID era in "Future"?

16

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Shut down

Future'Flatten': Economic impact depends on LENGTH of suppression
and DEPTH of economic drop

SCENARIOS ANDECONOMIC IMPACT

As of 24 April 2020

US (Preliminary figures)
Annualized economic impact1 (in % of USD/year)

Depth ofeconomic drop
1b
in 'Flatten'

15-20% loss

2-3%

3-4%

3-5%

20-25% loss

2-4%

3-5%

5-7%

25-30% loss

3-4%

4-6%

6-8%

W2 May2

W1 June2

W4 June2(7 weeks)(10 weeks)(13 weeks)(weekly economic loss as
a % of USD/week)

1aLength of 'Flatten'(in weeks)

1. % in matrix indicate the annualized economic loss (as a % of USD/year) that occurs for a combination of the weekly economic loss (as a % of USD/week) and the length of the suppression
period (in weeks). Lower end of ranges rounded down and upper end of ranges rounded up to reflect uncertainty. 2. Lockdown duration scenarios based on empirically observed 4-8 weeks
from peak infection. Does not reflect impact from peak infection rate, local healthcare capacity, local testing/monitoring capability or local government policies.

17

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Scenario and impact outcome differs based on geography and industry

'Flatten': Understanding of countries' sector composition criticalto estimate direct negative economic impact of reduced contact

SCENARIOS ANDECONOMIC IMPACT

As of 24 April 2020

US (Preliminary figures)

Government

e.g.
Biopharma& Bankinge.g.
Telecom& Construction

e.g.
Health care providers & Groceries

e.g.
Software & Legale.g.
Auto.& Mininge.g.
Restaurants & Tourism

15

39

14

14

18

of employmentof employmentof employmentof employmentof employment

US revenue by sector (%)

56

13

20

11

of revenue
Open under stay-at-home order
Low-to-high contact intensityof revenue
Limited under stay-at-home order
Low contact intensityof revenue
Limited under stay-at-home order
Medium contact intensityof revenue
Limited under stay-at-home orderHigh contact intensity

Source: US Economic Census; St. Louis Fed Reserve; BCG COVID response teams; BCG Analysis

18

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US employment by sector (%)

'Fight': Accelerated movement toward vaccine or treatment at scale
could limit 'Fight' phase to 12-24 months

SCENARIOS ANDECONOMIC IMPACT

As of 24 April 2020

0

1

2

3

4
Commercial scale-up

Small-scale clinical trial material

Traditional vaccine
development takes> 5 years

Discovery /screening

Scale-up at risk

Phase 1Disc

Phase 1(10s patients)

Phase 3
(1,000s
patients)

Phase 2(100s patients)

Limited preclinical testing

Start Ph 2 withinterim Ph1 data

Phase 3

Commercial launch

Key success factors/indicators:

Commercial scale up

Scale to support
global demand

Small-scale clinical trial material

Potential
accelerated pathway
for Covid-19 vaccine

Phase 2

5

Commercial
launchEmergency use
authorization for asmall volume release

Potential animal
challenge study in parallel• Published safety data to show vaccine has been
well tolerated in healthy volunteers• Manufacturing scale-up beginning immediately(expected ~6-12 month lead time)• Expansion of clinical trials to include volunteers
over 60 years old• Established a clear view on a surrogate of efficacy(e.g. challenge model)• Data from therapeutics emerging in a few months– drugs likely to reduce severity of infection

Source: Company websites, BCG analysis, https://www.fiercepharma.com/vaccines/china-s-cansino-bio-advances-covid-19-vaccine-into-phase-2-preliminary-safety-data,
https://www.weforum.org/agenda/2020/04/bill-gates-7-potential-coronavirus-vaccines/, https://academic.oup.com/jid/article/doi/10.1093/infdis/jiaa152/5814216,
https://www.nature.com/articles/d41586-020-00927-3

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Timeframe (years)

'Fight': China gives a first idea on what LEVEL of recovery the
economy can achieve

SCENARIOS ANDECONOMIC IMPACT

As of 24 April 2020

China

65

1.9

60

2019

1.8
1.7
1.6
1.5
1.4

2020

1.3
1.2

Wuhan

1.1
1.0
-18
17-Jan70

2019
Traded area of buildings in 30 cities(10K sq.m.)

2.0

Property transactions arerestarting

55
50
45
40

2020

35
30
25
20

-2 21-Feb14

30
23-Mar 46

62
23-Apr-18
17-Jan-2

1421-Feb3023-Mar 46

62
24-Apr

60

2019

50

40

30

2020

20

10

0
-18
17-Jan-2 21-Feb14

30
23-Mar 46

Note: As of 24 April 2020; China data re-based for weekdays excl. weekends. Congestion delay index average include Beijing, Shanghai, Guangzhou, Shenzhen, and Wuhan; Daily
coal consumption of major power plants = sum of daily average coal consumption of Jerdin Electric, Guangdon Yudean Group, Datang International Power Generation, andHuaneng Power International, Inc.; Source: www.cqcoal.com, and BCG Center for Macroeconomics

62
22-Apr20

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Coal consumption moving
higherDaily coal consumption (10K tons)

Average Congestion Delay Index

People and goods arestarting to move again

'Fight': Consumer sentiment suggests some willingness to resume
activities post lockdown, but not to pre-crisis level even with treatment

SCENARIOS ANDECONOMIC IMPACT

As of 13 April 2020

US
Activities
Flights2

Hotel2

Local

Available vaccine and/or
drugs to treat

82

85

84

84

91

No new cases in my country

82

80

76

83

91

Number of new cases
in my country slows

61

56

56

65

74

Government removes restrictions

46

46

47

55

62

I'm already comfortable doing thisor will be as soon as they reopen

16

18

18

I would never do this, even after wereturn to 'normal' times (%)

5

4

9

Restaurant Shopping

27

7

33

Observations
Even with treatment, activity level notgoing back to pre-crisis level for 9-18%

Even if governments remove restrictions,38-54% not willing to resume activity
16-33% already comfortable withresuming activities 'no matter what'4

Source: BCG COVID-19 Consumer Sentiment Survey, April 10-13, 2020 (N=2,960 US), unweighted; representative within 3% of US census demographics.
Note: Question text: "When will you feel comfortable [on activity]? Please select up to 3." Respondents who are already comfortable with an activity are assumed to be comfortable with all othermeasures as well; respondents who selected "government removes restrictions" are assumed to be comfortable with "number of new cases in my country slows."
1. Data includes only respondents who have been on a cruise in 2016-2020.; 2. Data includes only respondents who have done these activities on 2019-2020.
21

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Willing to resume somelevel of the activity (%)

Economic forecasts point to severe downturn in 2020—
global rebound to pre-COVID levels not expected before 2021

SCENARIOS ANDECONOMIC IMPACT

As of 22 April 2020

GDP growth forecast vs. baseline

GDP level forecast1-10%

EOY 2021 vs. EOY 2019

2021

-8%

-6%

-4%

-2%

Forecast -5.9%

0%

2%

4%

6%

Baseline 2.0%

8%

10%

-10%

-8%

-6%

-4%

-2%

0%

2%

1.7%

4%

6%

8%

10%

4.7%

96-103%

US
1.2%

6.0%

5.8%

9.2%

China
-7.5%

1.3%

1.4%

4.7%

Europe1.9%

5.8%

6.5% 7.4%

India
-5.2%

Japan

0.7%

0.5%

3.0%

107-113%95-101%

106-112%

96-100%Note: As of reports dated 31 March 2020 to 22 April 2020, YoY forecasts; Last week's forecast based on forecast of IMF and same banks 1. Range calculated with 25th & 75th percentile valuesof forecast range; 2. Range from forecasts (where available) of International Monetary Fond, JP Morgan Chase; Morgan Stanley; Bank of America; Fitch Solutions; Credit Suisse; Danske
Bank; ING Group; HSBC; Source: Bloomberg, IMF, BCG analysis
22
Baseline (IMF Jan 2020)
Forecast (IMF Apr 2020)
Forecast range (IMF & Banks2)Last week's forecast range

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

2020

TSR improved over last 20 days, but impact visible acrossall sectors; no sector above pre-crisis level across regions

BUSINESSIMPLICATIONSAs of 22 April 2020
Order of sectors reflects economic scenario and consumer sentimentFood/staples Retail
PharmaHousehold Products
Telecom
Semiconductors
Food & Beverage
Utilities
Health Equipment
SoftwareTech Hardware
Prof. Services
Materials
Retailing
Capital Goods
Financials
Transport
Media
Insurance
Hospitality
Banks
Real Estate
Auto
Durable Goods
EnergyAmericas

EuropeAsia

21 Feb '20 – 21 Feb '20 –20 Mar '20
22 Apr '20

21 Feb '20 – 21 Feb '20 –20 Mar '20
22 Apr '20

21 Feb '20 – 21 Feb '20 –20 Mar '20
22 Apr '20

Observations

-10%
-3%
-15%
-12%
-8%
-10%
-19%
1%
-20%
-5%
-22%
-1%
Non-discretionary/essential service less hit but
-19%
-6%
-16%
-8%
-5%
5%
Healthier sectors
still had recovery
-17%
-11%
-20%
-19%
-14%
-6%
-30%
-10%
-43%
-24%
-27%
-17%
-26%
-14%
-24%
-17%
-12%
-3%
-33%
-17%
-30%
-28%
-6%
7%
-33%
-14%
-31%
-15%
-11%
-4%
Broad set of industries experiencing
-30%
-14%
-32%
-22%
-28%
-16%
pressure, with some regions particularly
-29%
-17%
-25%
-11%
-23%
-18%
affected for certain sectors
Pressured sectors
-30%
-21%
-29%
-21%
-31%
-23%
Utilities and health equipment generally
-34%
-20%
-31%
-19%
-30%
-23%
better off in Asia
-42%
-28%
-36%
-29%
-24%
-8%
-38%
-24%
-35%
-27%
-29%
-23%
-36%
-22%
-35%
-25%
-19%
-12%
-37%
-25%
-38%
-33%
-13%
-14%
-36%
-24%
-47%
-42%
-14%
0%
-42%
-34%
-40%
-32%
-27%
-19%
-44%
-30%
-47%
-37%
-23%
-17%
Hardest hit sectors had some recoveries but
-41%
-37%
-44%
-47%
-26%
-23%
Vulnerable sectors
still performing way below 21 Feb 2020 levels
-42%
-33%
-26%
-22%
-22%
-11%
-47%
-38%
-45%
-35%
-32%
-25%
-49%
-38%
-32%
-23%
-21%
-14%
-57%
-43%
-45%
-30%
-41%
-31%
Note: Based on top S&P Global 1200 companies; Industries are based on GICS definitions 1. Performance is tracked for two periods, first from 21 February 2020 (before
international acceleration of outbreak) to 20 March 2020 (trough of the market) and from 21 February 2020 through 22 April 2020
Source: S&P Capital IQ; BCG ValueScience® Center; BCG
23

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

TSR performance1

Credit risk continues to be a concern for majority of sectors

Healthier sectors

Pressured sectors

Vulnerable sectors

Median 5-year CDS1 implied
probability of default2
Food/staples Retail
PharmaHousehold Products
Telecom
Semiconductors
Food & Beverage
Utilities
Health Equipment
SoftwareTech Hardware
Prof. Services
Materials
Retailing
Capital Goods
Financials
Transport
Media
Insurance
Hospitality
Banks
Real Estate
Auto
Durable Goods
EnergyCompanies in
distress (%)3

21 Feb 2020

22 Apr 2020

21 Feb 2020

22 Apr 2020

4%
3%
4%
4%
5%
3%
3%
4%
4%
4%
5%
4%
5%
3%
4%
3%
5%
4%
5%
4%
5%
5%
4%
5%

5%
3%
4%
7%
7%
4%
4%
5%
4%
4%
5%
6%
7%
5%
6%
3%
8%
7%
12%
7%
9%
13%
6%
13%

0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
4%
0%
2%
0%
0%
0%
0%
7%
0%
0%
0%
0%
0%

0%
11%
0%
15%
0%
0%
0%
0%
0%
0%
0%
19%
47%
10%
0%
32%
14%
0%
43%
8%
20%
33%
5%
41%

Note: As of 22 April 2020; Based on top S&P Global 1200 companies; Sectors are based on GICS definitions
1. Credit Default Swap 2. Performance is tracked on 21 February 2020 (before international acceleration of outbreak), and 22 April 2020
implied probability of default Source: S&P Capital IQ; BCG ValueScience® Center; BCG

Observations
Less discretionary and cash-rich sectors
are largely at lower risk of default incurrent climate

Retailing with spike in companies in
distress (~50% of retailing sector with
> 15% implied probability of default)Auto, hospitality, and energy industries
facing greatest risk of default based on
current credit profile

3. Distressed comprises over 15%
24

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 17 April 2020 Version 2.1.

As of 22 April 2020

BUSINESSIMPLICATIONSBusiness leaders can navigate through 'Flatten' and 'Fight'
leveraging a dynamic cockpit for their specific industry

BUSINESSIMPLICATIONS

Dynamic Cockpit

Macro indicators

Category demand evolution
Category economic scenarios

Public health situation• Virus spread scenarios

EPI MODEL• Medical demand/
supply assessment

PLAN

Macroeconomic developments• GDP estimateddevelopment

Internal data sources

ECONOMICSCENARIOS• COVID eco. impacts
on categories

CONSUMER
SPEND• Scenario-based
future sales

SALES
SCENARIOS• Short-term demand by
product/location

DEMANDSENTINEL

Demand data

Stock data

• Segments / categories,
channels, company vs.
competition• Sell-in / sell out scenarios• Sell-in / sell out actuals(customer, week and location /channel level)

Orders

Product and customer
master data

• Stock levels, purchasematerials and location• Product and customer
attributes and hierarchies

Production data

Commercial data

• Production planning forcoming weeks• Promo calendar• Government policies• Labor impact

UNEMPLOYMENTSCENARIOS

Governmental measures• Government
response timelines

OUTBREAKSCENARIOS

Customer behavior shifts• Online user behaviors

DEMANDSENTINEL• Sentiment surveys

CONSUMER
SPEND• Lockdown status andestimated end date
Source: BCG

25

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

External data sources

BUSINESSIMPLICATIONS

Example for the Fashion and Luxury industry
As of 12 April 2020

Pre-crisis to current

7 days momentum

FashionLuxuryFashionLuxuryFashionLuxuryPayment patterns

-45%

-63%

-45%

-63%

-42%

~-2%

Web traffic

-4%

-14%

-4%

-4%

-4%

+6%

Online search trends

-42%

-23%

-22%

-5%

+3%

+11%

DemandFashion& LuxuryOpen retail space

-100%

-100%

-

Unemployment rate

+146%

+146%

+5%

Average-67%

Job listings

Supply

-69%

-63%

-80%

-63%

-9%

-48%

+4%
+156%

Discount penetration~-7%~+198%~-7%~+198%-14%+4%

Average discount rate

~+3%

~-9%

~+3%

~-9%

+2%

+1%

Cotton Futures
Average

-17%
-23%

-13%
-71%

-14%

-1%
-62%

+42%

Source: BCG
Note: Bottom is defined as the lowest point during the (partial) lockdown period, for Fashion & Luxury in the US this would be 15 March 2020; pre-crisis refers to 21 April 2019

+38%
26

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Pre-crisis to bottom

USBUSINESSIMPLICATIONS

Example for the Machinery industry (including automation)
Pre-crisis to bottom

Pre-crisis to current

7 days momentum

Energy consumption

~-21%

~-21%

~-1%

Carbon certificate price

-

-

-

Automotive

~-33%

~-21%

~+16%

Construction

~-11%

~-9%

~-1%

Oil & Gas

~-5%

~+9%

~-1%

Food & Beverage

~-11%

~+1%

~+4%

Chemicals

~-9%

~+2%

~+7%

Insolvency filing

+6

-

0

Automotive prod. volume loss

~-15%

~-15%

~-5%

Chemical commodities' price develop

~-9%

~-9%

~-4%

Average

~-13%

~-6%

~-2%

Job listings

~-76%

~-76%

~+1%

Traffic load

~-50%

~-38%

~0%

Cargo volume

~+45%

-

~-42%

Average

~-27%

~-57%

~-20%

Price levels

~-10%

~-9%

~+2%

Debt trading

US

DemandMachinery(including
automation)

SupplySource: BCG
Note: Bottom is defined as the lowest point during the (partial) lockdown period, for MIA in the US this would be 5 April 2020; pre-crisis refers to 1 January 202027

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

As of 12 April 2020

While all sectors are affected by the downturn, some companies
emerge as winners within each sector

BUSINESSIMPLICATIONSAs of 22 April 2020
Year-to-date shareholder return in % per sector
20
0
-20
-40

Top 10%Bottom 10%

MedianEnergyDurable Goods

Auto

Real Estate

Banks

Hospitality

Insurance

Media

Transport

Financials

Capital Goods

Retailing

Materials

Prof. Services

Tech Hardware

Software

Health Equipment

Utilities

Pressured sectors

Vulnerable sectors

Performance spread between bottom & top 10%

Note: Data as of 22 April 2020; Sectors are based on GICS definitions; Companies sampled from S&P Global 1200
Source: S&P Capital IQ; BCG ValueScience® Center

28

Copyright © 2020 by Boston Consulting Group. All rights reserved.

Healthier sectors

Food & Beverage

Semiconductors

TelecomHousehold Products

Pharma-80

Food/staples Retail

-60

1

COVID-19 Context and Development
Disease progression, health care system capacity, and response

2

Economic and Business Impact
and Scenarios
Economic response
Scenarios and key drivers

3

Guide for leaders
Principles for leadership
Navigating businesses through uncertainty
Emerging stronger
29

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Government policies and action

Guiding principles
for leadershipin crisis

Be visible, purposeful,and authentic

Leverage the principleof “commander’s intent"Communicate in ways that engage andincrease the relevance of your teams
and clarify the reasons underlying yourcommunications

Share only key objectives and rationaleof required actions to allow theorganization to be flexible and adaptive,
and allow a focus on execution“THESE are the times that try
men's souls. The summer soldier
and the sunshine patriot will, in
this crisis, shrink from the serviceof their country; but he thatstands by it now, deserves the loveand thanks of man and woman.
Tyranny, like hell, is not easilyconquered; yet we have thisconsolation with us, that theharder the conflict, the moreglorious the triumph."

Use multiple clock-speeds

Engage externallyThink on multiple timescales byconsidering the now, the next, and thelater. Ensure that leadership teams lookahead and prepare for the future

Communicate with customers andstakeholders to gather frequent, fresh,
firsthand information to adapt andrespond effectively

Cut through bureaucracy

Keep imagination alive

Assemble a multi-functional task force
that is empowered to make decisions
and suspend normal decision protocols

Look out for new needs and opportunities
to serve clients now and beyond the crisis.
We will not be reverting to a 2019 reality

Thomas Paine, The Crisis

Source: When Leadership Matters Most, BCG Henderson Institute30

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

PRINCIPLES OFLEADERSHIP

Questions on every business leader's mind right now

future" look like?

• What are potential long-term impacts to consumer behavior?
• How will business economics be structurally different?
• What will the competitor landscape look like in the future?
• What (digital) trends will have accelerated due to COVID-19?
• Which new trends will appear?
• Can our supply chain still rely on international trade?
• How will the future of work develop?
• Which changes in employee routines will remain?

2 How should we
prepare and win?

Source: BCG• How do we emerge stronger after the crisis?
• How do we build capabilities for the future?
• What "no regret" or "low regret" moves can we make? Whenshould we make various moves?
• How can we accelerate innovation, adoption of future digital,
and technology trends?
• How do we collaborate effectively with society andgovernment?

31

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

1 What will the "newNAVIGATING BUSINESSTHROUGH UNCERTAINTYExample based on companies that leveraged the 2008 crisis
to innovate
BCG 50 Most Innovative Companies(as identified in 2007)

100
100

Morgan Stanley Capital International (MSCI) World

119

98

+4.0%

99

86

TSR p.a.

97
89
83

79

63

58
2007

2008

2009

2010

2011

2012

Note: Chart compares TSR performance of publically listed MIC (Most Innovative Companies) 50 companies in2007 (pre-financial crisis) and follows their TSR performance through the crisis until 31.12.2012;
Source: Accelerating out of the great recession book, BCG Innovation Journey Analytics Database; CapitalIQ

32

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Winners
innovate toaccelerate outof a crisis

In the new normal, existing trends will accelerate
and winners will define new ones

NAVIGATING BUSINESSTHROUGH UNCERTAINTY

Medtech example
Not exhaustive

What will the "new future" look like?

COVID-19 likely accelerating
existing/anticipated trends

COVID-19 may introduce newlong-term trends/impacts

Telemedicine

Pointof careProviderconsolidation

Digitalengagement

Protectionism

Economic
downturn

Increasing patient
adoption of virtualinteractions withphysicians for a wider
range of maladies/treatments

Disruption in industry
will see rise of new caremodels; may sparkmove away from
hospitals for some lessinvasive/complicatedsurgeries (e.g. hip
replacements)

Potential liquidity crisis
could put smaller
players out of businessand advantage larger
networks of provider
services going forward

New investments indigital marketing andnovel sales tactics could
yield long-term structuralchanges to how
manufacturers engage
with physicians (andphysicians with patients)

More restrictive flow ofgoods, innovation, andpeople could result inbalkanized markets andthe need to focus on
different set of markets
for future growth

Global recession will lower
overall demand for elective
health care services; rise in
unemployed and uninsured
will dampen demand

Note: These analyses represent only potential scenarios based on discrete data from one point in time. They are not intended as a prediction or forecast,and the situation is changing daily (as of April 6, 2020); Source: BCG

33

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

1

In the new normal, existing trends will accelerate
and winners will define new ones

NAVIGATING BUSINESSTHROUGH UNCERTAINTY

Retail (non essential) example
Not exhaustive

What will the "new future" look like?

MarketMany sub-sectors
will consolidate
into a triumvirateof or two traditional
players, at-scale
marketplaces, andniche players(including pureplays,
direct to consumer)

Marketplaces andessential retailers
will disruptively
steal share in nonessential categories(less so where barriers
to entry are high or
supply chains aredifferent e.g. DIY)

Channels

Large share ofphysical retail may
permanently close
as lower spending,and decline inrelevance of malls,
brings less foottraffic (less so wherestores provide
experience)

Omnichannel growth
will challenge
retailer economics,
and require businessmodel and customer
experience innovation,
as consumers pushtoward e-commerce as
the norm

Operating model

Customer
communication
will largely move todigital marketingas retailers loseability to use storesto drive traffic (less sofor categories withstructural need forstores e.g. DIY)

Cost base will be
restructured formost companies,
potentially throughbankruptcy or
insolvency
proceedings (e.g.
Chapter 11,
Company Voluntary
Agreements)

Note: These analyses represent only potential scenarios based on discrete data from one point in time. They are not intended as a prediction or forecast,and the situation is changing daily (as of April 6, 2020); Source: BCG

Supply chains will
become diversified
with pressure to
shift inventory tovendors as retailers
seek to reduceinventory costs,
cash-outs, and therisk of product not
selling

34

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

1

Adjust portfolio priorities to capture
demand across key categories, over"Fight" and "Future" phases

Innovate across thevalue chain

Accelerate innovation—reimagine thesystem to scale value-creating ideas
across the value chain and customer
journeys(e.g. Transform go-to-market approach)

Evaluate org. structure;
ways of working

Transform organization to enablestrategic change—leverage 'future of
work' models

Accelerate E2E digitization

Double down on shift to digital during
COVID—embrace opportunities acrossall processes

Consider inorganic
opportunities

Pursue attractive M&A options or otheropportunistic moves during downturn—consider macro and company landscape
35

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

To emergestronger,leverage
disruption
by making bold,strategic moves

Reevaluate portfolio
strategy and restructure

Weak-economy M&A deals outperform strong-economy deals
How should we prepare and win?

Observations

Cumulative relative total shareholder return index
106.4

106.1

Weakeconomy
deals

100.4
100

100.2

+9.6
99.4

T-3

T+3

96.5

Year 1

Strongeconomy
deals

Weak-economy deals
outperform strong-economy
deals by more than 9
percentage points
The benefits are even higher
for non-core acquisitions(outside the buyer's industry)
Both experienced M&A
dealmakers and occasional
acquirers create value fromdownturn deals

Year 2
Note: Strong-economy (weak-economy) years are those in which the respective global real GDP growth rate is in the top (bottom) third of all growth rates in the observation
period. The total of 9,987 M&A transactions comprises pending, partly completed, completed, unconditional and withdrawn majority deals announced between 1980 and 2018with a deal value greater than $250 million. Only deals with a public buyer were considered. The share price three days before the announcement date (T-3) equals 100. Shareperformance from T-3 to three days after the announcement (T+3) equals the announcement effect.
Source: Revinitiv; Datastream; BCG analysis

36

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

2

EMERGING STRONGER

How should we prepare and win?

1

Managed services andCloud – Health care

• Increase in requirement for
digitization of records and cloudstorage for analytics

IT Services example

Six pools that
could potentiallyprovide goodacquisition
targets

Tailwind• Government may mandate needfor more providers to be connected
to cloud to be able to access inflow
and capacity real-time

4

Cybersecurity –Banking and Securities

2

BPO – Banking,
Securities, and Retail• Increased adoption of remotebanking and digital processing bybanks; increased e-commercetransactions to positively impact
BPO services requirement• Transaction-based services likebrokering, collections, arenegatively impacted; physicalretail stores may see lasting
footfall decrease as e-commerce
adoption increases

5

Unified Communications
and Collaboration acrossindustries

3

All IT services –Insurance• Increase in number of claims,
fresh policies and renewals, higher
volumes will require more
outsourcing for processing• However, In the shorter term
insurance companies will havestretched financials
due to high claim ratio

6

Engineering services –Health care

• Increased focus on cybersecurity ofassets as WFH/remote working
proliferates• Increased requirement for remoteand secured connectivity due toremote operations• Increased spending on testingand health care (ventilators)
equipment• Increase in online banking anddigitization of processes• More spend on collaborations
software including task
management, communication, etc.

• More spent on health careinfrastructure across the board
by governments world over

Headwind37

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2

9

action areas
for businessleaders

Establish crisis
management

Navigatethrough
Flatten, Fight,
and Future

Scenario-Based
1 Develop
Planning Approach toFight

Futurea Rapid Response
2 Createand Transformation

manage uncertainty(RR&T) team

Organization and
3 Revamp
People for the new normal

Cost, Cash,
6 Manageand Liquidity

Topline Security
4 Driveand Customer trust

Stronger; drive
7 Emerge
advantage in adversity

and restart Supply
5 Stabilize
Chain, Manufacturing

Digital and8 Accelerate
Technology transformation

Society during
9 Help
COVID-19

Note: RR&T = Rapid Response and Transformation Team
Source: BCG

38

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

FlattenDetailed measures across priority action areas (1/3)
Fight• Deep-dive into possible outcomes of disease spread, demand
shifts, supply/ops issues, regulatory requirements, andpotential operations restart; adjust for sector-specific issues• Frequently run scenarios and update plan; focus onunderstanding the de-averaged impact by geography
and line of business, depth of demand drop, durationof Fight phase1

Develop Scenario-Based
Planning Approach to
manage uncertainty• Perform scenario stress tests around cash-flow• Establish preconditions for what it will take to get workforce
back to offices, factories, etc.
• Set up teams to work on different time horizons (Flatten, Fight,
Future) to avoid reverting to crisis management across all

2

Create a Rapid Response
and Transformation(RR&T) teamNavigate throughFlatten, Fight, and Future

3

Revamp Organization andPeople for the new normal• Establish nimble cross-functional Rapid Response &Transformation team (RR&T)• Refine processes to manage the crisis situation, remote
working, disruption in supply• Ensure smooth transition of operations and workforce tothe 'new reality'• Shift to digital/remote customer interactions• Define policies to keep employees safe with high morale• Engage across levels to retain talent• Move to online/remote working; redefine rosters and train
for efficiency/effectiveness• Establish preconditions for coming back to the working
environment; clearly communicate them
• Build SWAT teams to address critical business areas, such as
product launch, digital channel redesign, retail delivery models
Source: BCG

Future• Develop recommendations for daily planning,
resources, supply chain, workforce, and otherstakeholder management as per modeled scenarios• To manage the massive complexity of "restarting",enhance Rapid Response & Transformation teamstructures• Develop approach for how to bring people back to work,
how/when to engage customers• Establish governance and standardization to effectively
coordinate other areas from the RR&T
• Get ahead of the curve on team to manage policies
to get teams back to work safely• Take a clear view of forward demand and the newnormal: manage/restructure organization to fit
capacity needs• Create dedicated focus to accelerate digital,
process automation, new ways of working

39

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

FlattenEstablish crisis
management

Detailed measures across priority action areas (2/3)

4

5

Drive Topline Security &Customer Trust

Stabilize and restart
Supply Chain,
Manufacturing

Fight

Future• Reach out to customers for their situation and needs,• Assess changes in customers' behaviors• Drive actions to inspire confidence and ensure ability todeliver (e.g., multichannel, people-light approaches)• Adapt and transform channels(e-commerce), sales, marketing spend, pricing, and support• Manage volatility in demand, and refine sales motions(e.g. to virtual) and objectives• Ramp up commercial efforts significantly to seize market
shifts; leverage learnings to accelerate digital capabilities• Take measures to ensure operations continuity:
workforce safety and management, stop-gap measures
for supply chain, site readiness (access, maintenance,services, suppliers)• Ensure quick and safe restart of facilities; drive
centrally driven efficiency measures• Ensure open and direct communication with employees• Explore solutions to retain key talent• Set up capabilities (org, control tower) tomanage unstable supply chain; explore alternate
networks, dual/multiple suppliers for criticalgoods and services, delivery methods, etc.
• Accelerate production as demand rebounds;
account for product shifts

6Manage Cost, Cash,and Liquidity• Build forecasts for COVID-19 impact on P&L,
balance sheet, investor base• Build central team to simulate financials as per
evolving scenarios; drive agile working ways

• Review capital sufficiency scenarios and possible
effects on credit risk

• Decisively take structural actions: TURN PMO,
zero-based budgets, delayering/restructuring,
re-base tech portfolio, etc.; deploy rapidly as
speed is predictive of success in downturns• Manage credit and debt commitment for short term
• Create agile FY20-21 business plans and budgets todeal with uncertainty

Source: BCG

40

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

FlattenNavigate throughFlatten, Fight, and FutureDetailed measures across priority action areas (3/3)• Stress-test current value proposition and business
offerings, and scan crisis impact on key
customer/market trends

7

Emerge stronger; drive
advantage in adversity

Fight

Future• Plan for new projects to shift the portfolio andleverage the 'new normal'; plug capability gaps
• Identify white spaces in own industry and ecosystem• Selectively invest in areas where opportunistic M&A
can be conducted• Develop and implement strategy to exploit greatertalent availability

8

9Accelerate Digital &Technology transformation

Help Society during
COVID-19• Address and serve immediate workforce needs forremote working• Identify and implement key digital use cases andadapt to agile way of working• Leverage tools for conducting key processes online• Accelerate use cases to meet demand shifts• Adapt traditional processes to become digitally viable• Redesign key customer journeys with emphasison digital interventions• Ensure immediate support to employees, suppliers,
communities, etc.
• Team with government/local communities/acrossindustries to address crisis• Determine how to contribute in the crisis toemployees, customers, through medical response,
supply of essential items for society, or by playing
a positive economic/employment role

• Leverage assets, supplier relationships, logistics
networks, and employees to help adjacent communities• Allocate innovation resources where possible tofocus on solutions to COVID-19 crisis• Work across industry boundaries to identify crosssectoral synergies to deploy solutions• Leverage expertise developed to support
government policies and responses, rebuild
business for local customers, suppliers, etc.

Source: BCG

41

Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

FlattenNavigate throughFlatten, Fight, and FutureAdditional perspectives on COVID-19
Selected sector publications

Transformation

Strategy

Public Sector

Automotive

Financial Institutions

COVID19: Win the Fight,
Win the Future

Advantage Beyond the
CrisisBeyond the Curve: How to Restartin the Wake of COVID-19

Auto Companies Will Outlast
COVID-19 & Come Out Stronger

Global Risk 2020: It's Time forBanks to Self-Disrupt

Globalization

Crisis Response Checklist

EnergyHealth Care

Consumer

COVID-19 and theEmerging-Market Consumer

Checklist

How Uncertainty Is Hitting M&A
in Oil and Gas

Biopharma Applies New Service &Support Models amid COVID-19

COVID-19 Consumer SentimentSnapshot #5: Hitting the Straightaway

Leadership & Talent

People & Organizations

Travel & Tourism

Telecommunications

Transportation & Logistics

Leading Out of Adversity

Take Care of Tech Talent
When it Matters

The Great Reset for Revenue
Management in Travel

Time for action: In times of
COVID-19 Telcos need to move
rapidly to be part of the solution

Transportation & logistics
companies must adapt to keepsupplies moving

Source: BCG

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

Selected overarching publications

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Copyright © 2020 by Boston Consulting Group. All rights reserved. Updated 24 April 2020 Version 3.1.

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