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Do You Have a Contingency Plan?

One of my life’s little pleasures is a stop in the morning at Starbucks for a cup of coffee. I simply seek a plain cup of dark roast coffee, not one of those fancy concoctions that require memorization of an extensive list of ingredients. To some of you, the product line may make you curl your lips, but I enjoy the intensity, flavor and of course the caffeine!

One visit to Starbucks in particular was a bit special. My wife and I were watching our one-year-old granddaughter for the day. What better way to take on this challenge than with a cup of freshly brewed Starbuck’s coffee at our side? I found myself in a foreign Starbucks, one I had never frequented, located close to my son’s house. I placed my order, simple enough: 2 Venti coffees, 1 decaffeinated and 1 dark roast. However, there was a problem. With the high morning volume there was no decaf left.

Knowing the time required to brew a new pot of coffee was fairly long, the Starbucks associate deployed a contingency plan! With great speed and precision the associate constructed a small apparatus on the bench top and went to work creating a Venti cup of decaffeinated coffee. In several minutes the remaining cup in my order was ready and I was on my way. However, this method piqued my interest and I had to ask the specifics. This brew method produces a coffee flavor close to what you would find if taken from the larger drip units. The water temperature is monitored as is the amount of grounds used to brew the single cup of coffee. It is labor intensive and if it was used as a common tool it would increase the queuing of customer lines! But, if used as a contingency tool it is quite effective until the main process is back online. Simple yet elegant!

When I review strategic concepts with my students as well as at my workplace, the requirement to have a contingency plan is emphasized. The first step is to determine potential failures whether they be equipment, information or people related. These potential failures are critical to meeting the key customer requirements of quality and delivery. In addition, how would business metrics be affected related to forecast and cash flow? Leave cost out of the review! This will allow the participants on your team to brainstorm options and corrective actions freely. The second step in this process is to evaluate options and determine what will be required to enact if/when needed. This may require additional capital investment, storage of data files off site or additional cross training to build bandwidth. Key to this study is a rating system of probability and severity. Failing to complete this exercise on a proactive basis may result in trying to figure it out after the failure occurred. For your customers that is too late. Claiming “force majeure” is an option but your customers will cringe at the very sound of these two words.

So you must ask yourself the “what if” questions! Is there a “pour through” option for my critical operations? If not what do I need to do to have one? At the end of the day, a customer is affected. Preventive mitigation may not be optimal. But this plan far exceeds having nothing in place!

Related Benedictine Programs

If you’re interested in learning more about developing successful strategies for your organization, Benedictine’s online MBA and online Master of Science in Management and Organizational Behavior program offer courses on Strategic Management, Analytical Tools for Management Decisions, and Project Management. Benedictine University also offers Bachelor’s degree programs. To learn how an online degree from Benedictine can help you hone your strategic management skills, talk to a Program Manager today.

About the Author

Pete Papantos is an operations director at a Fortune 500 company. He is responsible for the global execution of their strategic plan and driving operational excellence using lean methods. In addition, Pete is a graduate instructor with emphasis in operations and strategic management — both in traditional and online settings.