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Article

9 minutes

A Guide to Mitigating Risks in Global Workforce Management

Global HR

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Author

Kate Moerel

Published

October 11, 2024

Last Update

October 11, 2024

Table of Contents

What is contingency planning?

What do effective contingency plans include?

Contingency planning in the global market

Actionable Tips for Effective Global Workforce Contingency Planning

Boost your global success and minimize your worries with Deel

Key takeaways
  1. Contingency planning is vital for recognizing and managing business risks.
  2. Solid contingency plans require a deep understanding of complex factors affecting your business and its markets.
  3. Global companies must also focus on cultural sensitivity, diversity, and a complex regulatory landscape.

Are you prepared to tackle unplanned upheavals? Contingency planning is vital to risk management. It prepares organizations to respond efficiently to unexpected events, making ongoing success and stability easier to maintain.

From natural disasters to market instability, countless events can disrupt a business’s regular operations and threaten the survival of otherwise solid companies. The importance of these factors is even greater for international organizations, where obstacles can quickly escalate beyond control if poorly managed.

But good planning isn't just about preventing catastrophic failure. When applied to the complexities of managing and planning for a global workforce, contingency planning can significantly reduce the risk and effort involved in streamlining people management operations, opening smooth avenues for growth and expansion.

This post looks closely at how contingency planning works and how to use it effectively.

What is contingency planning?

Strictly speaking, a business contingency plan is a protocol or course of action designed to help businesses navigate uncertainties and obstacles. It involves identifying potential risks that might impact the business and developing an actionable mitigation strategy. Simple enough, right?

Reality is a little more complicated. Scalable strategies and realistic roll-out plans are necessary to effectively cover different scenarios and offer solutions that actually work. Furthermore, open communication and a clear understanding of the business landscape are equally important.

What do effective contingency plans include?

When building a solid contingency plan, you should focus on ensuring five core actions are included in your setup. We’ve listed them below, together with some actionable tips you can implement to hit the ground running.

1. Risk Assessment and Business Impact Analysis (BIA)

Risk Assessment and Business Impact Analysis (BIA) are central to understanding potential business risks and their impact. They guide you in preparing for, mitigating, and responding to potential threats, prioritizing risks based on potential impact, ensuring resource allocation can ensure business continuity, and enabling businesses to effectively minimize downtime and financial loss.

Implementation tips

Simplify the process of identifying and mitigating risks like compliance challenges, global payroll disruptions, and worker misclassification. Through our Compliance Hub and AI-driven insights, businesses can monitor and prioritize risks with ease, ensuring that critical functions are protected.

  • Provides regulatory updates, workforce insights, and compliance alerts across 150 countries, keeping you informed of legal changes that may impact your workforce.
  • Analyzes worker data and sends alerts about compliance developments, including expiring visas, misclassification risks, and non-compliance warnings.
  • Automatically track regulatory changes, ensuring that your business always remains compliant with the latest labor laws.
Global Hiring Toolkit
Misclassification Assessment
Mitigate worker misclassification risks using our combo of AI and award-winning research into employment court cases.

2. Identification of critical business functions

The next step is to identify functions that are crucial to your business’s operations. This step ensures that risk management focuses on high-impact areas, facilitating efficient resource allocation and quick post-incident recovery. Our platform helps you prioritize and protect critical functions during a disruption. With our Contractor of Record service, businesses can ensure compliance with local labor laws, while we take on the liability for contractors, allowing you to focus on maintaining operations.

Implementation tips

  • Use a contractor of record which assumes all liability and indemnification for contractors, reducing legal and financial risks for your business.
  • Streamline hiring and payroll for global teams, ensuring essential roles are covered without delay.

Deel’s Contractor of Record gave us peace of mind when hiring people as contractors in any part of the world. I don’t have to worry anymore about compliance. It feels much safer

Chloe Riesenberg,

People Specialist, Project44

Read how Project44 saves around $500,000 a year since switching to Deel and gets added peace of mind with Contractor of Record coverage

3. Development of action and response plans

Effectively address specific risks or incidents, detailing recovery strategies, roles, and communication protocols. These plans, which can vary across roles, processes, and risk factors, are the backbone of organizational resilience and will help you resume normal operations rapidly and with reduced impact. Our centralized dashboard allows businesses to automate and define action steps for potential disruption scenarios.

Implementation tips

  • Visa and immigration support: Sponsor visas on behalf of your company, ensuring that key employees can stay or be relocated during disruptions.
  • Equipment management: Provide tools to manage equipment and coworking memberships, making it easier to deploy remote teams during crises.
  • Benefits administration: Support global benefits administration, ensuring that employees receive necessary benefits during disruptions.

4. Establishment of effective communication strategies

The successful rollout of any contingency plan hinges on how well that plan is understood and embraced. That is why a solid communication strategy is another essential element of contingency planning. It will help you address misinformation, maintain stakeholder trust, and coordinate recovery efforts.

A good strategy should ensure timely, clear, and consistent communication throughout an incident.

Implementation tips

  • Embrace remote communication and collaboration tools to provide remote communication and collaboration tools to keep your team connected and engaged, no matter where they are located
  • Identify stakeholders and develop tailored communication strategies for different audiences
  • Choose appropriate and diversified communication channels

5. Conducting regular updates and drills

Updating and rehearsing plans regularly ensures their effectiveness in addressing evolving business conditions and risks. Regular drills test preparedness, identifying areas for improvement. Learn to see these as an ongoing process in which adaptability and resilience are continuously improved through iterations.

Implementation tips:

  • Schedule regular reviews and conduct drills
  • Use AI tools to assess the classification of workers worldwide, reducing misclassification risks and ensuring regulatory compliance.
  • Gather feedback for improvement
  • Incorporate lessons learned
  • Ensure plan accessibility and maintain documentation
Continuous Compliance™
Unlock Continuous Compliance™ with Deel
Keep your finger on the pulse of global compliance issues like never before. Our Compliance Hub provides access to the latest regulatory updates and risk warnings, offering guidance and actionable alerts to enhance compliance—all in a single place.

Contingency planning in the global market

Are you operating at a global scale, or planning to in the future? There are more aspects you must consider if you want your contingency plans to work.

An international presence introduces a range of complexities and uncertainties that local businesses may not have to deal with. This makes the need for well-designed contingency plans even more important for global organizations. While important to consider for companies of all sizes, the points listed below are especially critical for global businesses to keep in mind when making plans.

Cultural sensitivity and adaptability

Global operations involve interacting with diverse cultural norms, practices, and expectations. Contingency plans should include culturally sensitive strategies adaptable to varying circumstances across different markets and regions.

Regulatory compliance across jurisdictions

Companies operating globally must adhere to the laws and regulations of each region they operate in. This is a non-negotiable requirement for long-term success and should be a high priority in any contingency plan.

Discover the compliance challenges companies face when growing globally in our dedicated guide.

Download the guide

Supply chain resilience

Global operations often rely on complex, interdependent supply chains. Contingency planning must ensure these can withstand the pressure of various disruptions, including natural disasters, political unrest, pandemics, or trade disputes. Actions that can help address these disruptions can involve diversifying suppliers, increasing inventory levels for critical components, or reevaluating logistics strategies.

Without Deel, our desire and capability to help would have taken several days or more—a lifetime for those impacted. It was very fulfilling on a personal basis to make these humanitarian decisions and have them provide immediate help halfway across the world. While this doesn’t help the broader population, there is a large multiplier effect on those who we help.

Bryan DiGiorgio,

CEO & founder of 1840 & Company

Discover how 1840&Co aided their distributed workforce with Deel

Political and economic instability

Countries differ in political and economic stability levels, which can unexpectedly affect business operations. Contingency plans should prepare global companies for sudden changes in political leadership, economic downturns, or sanctions that could impact their ability to operate in certain regions.

Currency and financial risks

Operating across different countries also introduces exposure to currency fluctuations, differing inflation rates, and other financial risks. Strategies for hedging against these risks, such as currency forward contracts or maintaining liquidity in stable currencies, should be core elements of a contingency plan.

Technology and cybersecurity

As operations expand globally, so do cybersecurity threats. Contingency plans must prioritize robust cybersecurity measures and have clear protocols for managing information systems and mitigating cyber incidents across global operations, including outages and data breaches.

Want to learn more? Discover how Deel approaches security on the global stage

Localized approach to crisis management

While having an overarching contingency strategy is important, global operations must also allow for localized adjustments. This means tailoring response plans to each region’s specific risks, resources, and cultural nuances to ensure effectiveness.

Guide

Are you building a global team?
Global hiring comes with global compliance challenges. Learn how to improve your approach.

Actionable Tips for Effective Global Workforce Contingency Planning

So far, we’ve examined how to set yourself up for success when working on global contingency planning, but we also have some practical tips to help you get started right away. Below is a list of actionable points we think will make your work easier when managing unexpected events in your workforce management.

Use a contingency plan template

A contingency plan isn’t a one-off document. Build a template and work from that to ensure all your plans are standardized and include all the necessary information.

  • Research templates: Begin by researching various contingency plan examples online. Look for ones that are comprehensive and can be easily customized.
  • Select a template: Choose one that aligns with your business needs and complexity. It should cover business continuity, emergency contacts, resource allocation, and crisis communication.
  • Customize your template: Modify the selected template to fit your organization’s specific needs. Include sections relevant to your business operations, the global scope of your workforce, and the types of risks your business may face.
  • Identify critical functions: Within the template, identify and prioritize your business’s critical functions and operations that must continue during an emergency.
  • Assign responsibilities: In the template, clearly delineate roles and responsibilities for crisis management, including decision-making authority during emergencies.
  • Document resources: Ensure the template includes a section for documenting necessary resources (human, technological, and physical) for critical operations during a crisis.

Engage with local stakeholders

A good plan isn’t built from the top down but relies on the expertise and experience of the specialists in your workforce and effective communication channels when the time comes.

  • Identify stakeholders: Determine the key stakeholders in each region. These may include local government authorities, emergency services, suppliers, and partners.
  • Schedule meetings: Meet with stakeholders to discuss potential risks specific to their region and how collaboration should occur in response to them.
  • Establish communication channels: Agree on communication protocols and channels for use during a crisis. Ensure contacts are kept up-to-date in your contingency plan.
  • Build local support networks: Work with stakeholders to create a support network that can be activated in an emergency, including shared resources or emergency response teams.

Learn how to leverage your global network to support your local teams in times of need in our guide to building borderless teams.

Download the guide

Focus on flexibility

Contingency plans help you be flexible in the face of unexpected obstacles. To do so effectively, they must be flexible themselves. Ensure your plans are dynamic and built around changing scenarios.

  • Scenario planning: Develop multiple scenarios that could impact your global workforce, considering both common and region-specific risks
  • Adaptive strategies: For each scenario, create strategies that are adaptable depending on the severity and type of crisis, ensuring you can modify your response as situations evolve
  • Regular reviews: Schedule quarterly reviews of your backup plans to reassess and adapt strategies based on new information or changes in the global landscape
  • Feedback loop: Establish a feedback mechanism where employees can suggest improvements to the plan based on their local insights and experiences

Train global team members

The most successful plans are the ones that don’t need to be explained when things go wrong but are already shared and clear beforehand. Ensure teams are ready to follow the plan when needed.

  • Develop training material: Create comprehensive training materials that cover the contingency plan, focusing on communication protocols, emergency procedures, and roles during a crisis
  • Conduct training sessions: Organize training sessions for team members worldwide, ensuring everyone understands the contingency plan and how to implement it. Consider using online platforms for easy access
  • Facilitate role-playing exercises: Simulate crisis scenarios through role-playing exercises to help team members practice their response in a controlled environment
  • Foster continuous education: Keep the workforce informed about updates to the contingency plan and provide continuous education opportunities to reinforce their knowledge and skills

Monitor key risks and metrics

  • Establish key metrics: Identify key performance indicators (KPIs) and metrics that will help you monitor the health of critical functions and the effectiveness of your contingency plan
  • Implement monitoring tools: Use technology solutions to continuously monitor these metrics, enabling real-time risk assessment
  • Regular reporting: Schedule regular reporting intervals to review key metrics, allowing you to assess how well your contingency planning efforts are working
  • Adjust based on findings: Use the insights gained from monitoring key risks and metrics to make informed adjustments to your contingency plans, improving resilience and agility

Boost your global success and minimize your worries with Deel

A good contingency plan can drastically reduce the negative impact of unexpected negative events on your business, including workforce planning. Implementing the actionable tips we suggested in this post can go a long way in ensuring organizational preparedness. Still, there is a further step you can take to ensure you make your action plan as successful as possible.

Deel offers a host of solutions to support organizations in their development and growth. From visa support and EOR solutions to help guarantee compliance wherever you operate to a full HR suite designed around the needs of companies operating globally and remotely, tools and plugins that streamline communication and transparency across your organization, ensuring the benefits of contingency planning are optimized.

Discover the full range of Deel products and find more information on global mobility and the future of work on our blog.

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About the author

Kate Moerel has been immersed in creating content that focusses on the relationship between employers and their workforce for the last decade, and advocates for a world of work without bias for all. She defines the content strategy to support organizations to thrive with a global workforce across all marketing touchpoints.

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