UK “Pingdemic” Highlights the Need for Better Scenario Planning

The so-called “pingdemic” – when the UK’s NHS app “pings” workers to self-isolate – is recent proof that companies need to react quickly when unavoidable circumstances force change. Scenario planning is an integral part of prepping for these occasions, but to experience effective results, it requires centralisation, automation, and integration to connect the right people to the right information in real-time, writes Dafydd Llewellyn, EMEA General Manager at insightsoftware.

Welcome to the “pingdemic.” The COVID-19 pandemic isentering a new phase after an initial rollout of mass vaccinations across the UK  saw over 75% of the adult population fully vaccinated as of August 10. In this new phase,the “pingdemic” – the number of people “pinged” or told to self-isolate by the NHS app – accelerated dramatically in recent weeks.

In the week of July 29, over 689,000 people received an alert, or “ping”, in the UK telling them they had been in close contact with someone who subsequently tested positive for COVID-19, resulting in a stay-at-home order for up to 10 days. That was an increase of 11% from the previous week and represented about 1% of the entire UK population.^[1]

This pingdemic affected swathes of the economy, including industrial production, retail outlets, and hospitality. Supermarket group Iceland closed shops after 1,000 of its employees were pinged, and big pub chain Greene King also closed 33 of its pubs due to the shortage of staff.^[2] The severity of the impact caused the UK government to exclude various sectors from the “pings” and reduce the sensitivity of the app, so it affected fewer people.^[3]

Theseongoing changes force  finance teams to continuously adjust their financial forecasts and swiftly adapt to the shifting economy. In a constantly changing environment, finance leaders need to keep a handle on costs, adjust forecasts, and provide quick answers to their executive teams.. Completing these processes effectively requires flexibility in the capture of data and analysis, providing the ability for managers to work with regularly updated, rolling forecasts. Such forecasts give an up-to-date view of how internal and external factors affect businesses, making it easier for managers to react and adapt to sudden market changes.

This latest phase of the COVID-19 crisis raises a host of important and difficult questions that require the most up-to-date information:

• How is the pingdemic affecting different regions throughout the UK?
• How is it affecting different parts of the business – logistics, customer-facing teams, central office capacity?
• How is it affecting the supply chain? What flexibility can the company exercise??
• Which parts of the business should the company prioritise if they must make hard choices due to a shortage of staff?

Finance teams have adapted in many ways since the first appearance of COVID-19. Those challenges include entire teams suddenly working from home in Q1 2020, successive full or partial lockdowns, and responding to movingtimetables for reopening the economy that varied across the four nations of the UK.

As the legal requirement to self-isolate changes (from the week of August 16), working from home shifts to a hybrid model(home plus office), and vaccination levels in younger age groups rise,the market environment – and those forecasts – will change yet again.

In sectors that depend on a young workforce, such as hospitality, the change in the rules about self-isolation will be particularly important, as the vaccination rate in younger people is relatively much lower. Under 65% of 18–25-year-olds in England had received their first vaccination as of August 10, compared with 95% of people aged 80 and over.^[4]

The need for scenario planning

As these successive waves of change break across the economy, one certainty is the need for finance teams to update, reforecast, reassess, and analyze finance data to make tough decisions. To capture the right data and analyze it in real-time, they need the right tools, which means:

• Maintaining all planning data in one integrated system
• Removing unnecessary, manual processes to reduce errors
• Linking different phases of the planning process, so sales forecasts automatically update financial forecasts
• Easily generating dashboards to visualise different scenarios

As the pandemic has shown, scenario planning drives business value. A 2021 FSN survey revealed 54% of scenario planners can forecast to within +/- five percent of earnings and revenue.^[5] Along with the right systems, it becomes much easier to do full scenario modelling, for example with high, low, and probable outcomes that affect the whole business.

Higher sales numbers may require more resources in production, or perhaps prompt outsourcing of some aspects of production and fulfilment. By contrast, lower-than-expected sales numbers might lead managers to adjust the marketing strategy in a bid to drive revenues higher. Either way, with scenario planning, a company builds in ways to anticipate the unexpected, make better and more informed choices, and ultimately mitigate risk.

Whether it is the current pingdemic or the wider pandemic, the finance team – and the company as a whole – will be ready for what lies ahead if it adopts scenario planning successfully. Put simply, success means less risk, better decisions, and more business value.

[1]https://news.sky.com/story/covid-19-pingdemic-record-numbers-as-689-313-alerts-sent-from-nhs-app-in-a-week-in-england-and-wales-12367080

[2]https://www.bbc.co.uk/news/business-57885175

[3]https://www.telegraph.co.uk/news/2021/08/02/covid-app-tweaked-alert-fewer-people-end-pingdemic-chaos/

[4] https://www.bbc.co.uk/news/health-55274833

[5]https://insightsoftware.com/resources/fsn-global-survey-2021-agility-in-planning-budgeting-and-forecasting/