The Impact of Business Continuity on Supply Chain Practices and Resilience Due to COVID-19

Abstract

Background: Business continuity entails the potential negative consequences of uncertainty on a firm’s ability to achieve strategic objectives. The COVID-19 pandemic significantly impacted business continuity due to lockdowns, travel restrictions, and social distancing measures. Consequently, firms adopted specific supply chain (SC) practices to effectively navigate this global crisis. Methods: This research adopted a stochastic approach based on Bayesian Networks to evaluate the implications of business continuity on firms’ decisions to embrace SC practices, focusing on omnichannel strategies, SC coordination, and technologies such as artificial intelligence systems, big data and machine learning, and mobile applications. Results: Our findings revealed that firms facing disruption in a single performance area can apply specific strategies to maintain resilience. However, multiple areas of underperformance necessitate a varied approach. Conclusions: According to our empirical analysis, omnichannel strategies are critical when disruptions simultaneously impact quality, inventory, sales, and ROI, particularly during major disruptions such as the COVID-19 pandemic. AI and big data become vital when multiple risks coalesce, enhancing areas such as customer service and supply chain visibility. Moreover, supply chain coordination and mobile app adoption are effective against individual performance risks, proving crucial in mitigating disruption impacts across various business aspects. These findings help policy-makers and business owners to have a better understanding of how business continuity based on performance resistance to disruptions pushes companies to adopt different practices including new technologies and supply chain coordination. Accordingly, they can use the outputs of this study to devise strategies for improving resilience considering their supply chain vulnerabilities.