Arvato Group | Bergamo/Milan, 04/02/2020

‘All You Hear Is Ambulance Sirens’

In no other city are the consequences of the coronavirus pandemic as devastating as in Bergamo, Italy, where as things stand at present 2,000 people out of a population of 150,000 have fallen victim to the virus. Arvato Supply Chain Solutions has a large subsidiary on the outskirts of the city – and continues its operations there. CEO Antonio Amati reports from the scene.

It is practically a miracle that Arvato Supply Chain Solutions Italia is still working. The company employs 34 people at its headquarters in Bergamo, 60 at its two distribution centers near the city, and another 200 in customer service in Milan. “When the outbreak blew up, honestly we needed some days to set our mind and to size the real dimension of it all,” recalls Amati. “But once we ‘changed the chip’ in our heads, we simply started to implement contingency plans prepared in the past, also considering some non-conventional solutions and adjustments when needed.” The management team, which besides Amati as CEO is comprised of Matteo Borneto, Martin Zoeckler, Sara Parimbelli, and Eleonora Arrigoni, decided to act according to three priorities: protect the staff, stabilize the business, and crystal-clear communications in every direction.

“The health of our staff is top priority,” says Amati. “Protection measures were implemented for them that go far beyond the Italian government’s requirements. We gave protection kits to all staff, with face masks, gloves, and disinfectants.” The cleaning of all buildings was also intensified, he says. “And we really went out of our way to get the masks we needed.” As the magnitude of the crisis became increasingly clear to him, he initially organized a two-month supply of protection kits, which has now already been increased for a further two months. “In spite of everything, we felt our staff were scared and worried,” reports Amati. “To counter this, we have taken out cheap but effective supplementary health insurance coverage for everyone, which will provide them with additional cover in the event of infection.” This was greatly appreciated both by the workers and the unions, he says. All these preventive measures are having an effect: “The absentee rate grew by only five percent, which is unbelievably low,” says the CEO.

For him and his management team, the second major challenge is to stabilize the business – that means first and foremost adjusting costs. “It was immediately clear that customer order volumes would be massively affected,” Amati says. He had to react to this, but: “Our aim is not to follow the crisis but to stay one step ahead, extending measures before and not after worst-case scenarios might occur.” Starting on March 9, the HR department altered employment contracts so that more staff could work from home with immediate effect, he says. When the head office in Bergamo was closed down, the Finance, HR, Sales, IT, and Key Accounts departments were able to shift to working from home, overnight,” says the CEO. There were no problems; all processes in all directions – whether to customers or to Bertelsmann – continued to run smoothly.

The same was true for meetings, which from then on were only held via Skype. “This had unexpectedly positive outcomes”, says Amati happily, “because many employees working from home alone simply took on more responsibility.” A few days later, he was also able to observe this at the Arvato Supply Chain Solutions Italia service centers: “Between March 14 and 15, thanks to overnight efforts made by our IT, Process, and HR departments, all call center agents in Milan were able to disconnect their own PCs and put them in operation again from their home offices. Now they can work from their home with the same net protection they have when in their office. On Monday March 16, the Customer Service in Milan reopened, offering the service as usual: Two thirds of the staff are now working from home, the rest are on holiday, and a few are on sick leave. This is now teaching us very interesting lessons for the future,” says Amati, “because if we can organize our operations out of office in a single weekend, we should be able to do this much better with more preparation.”

The Italians have also benefited from Arvato Supply Chain Solutions’s international network in recent days. Orders from one of the most important customers were transferred to the German distribution center in Dorsten to ensure delivery even in the event of a total lockdown of business in Italy. “In general, order volumes from customers have declined by around 30 percent, but this is offset, at least partially, by the flexibility of our workforce,” says Amati drawing a first interim balance of the effects of the coronavirus pandemic on his company.

From the very beginning, the CEO was convinced that in such a crisis it would be more important than ever for employees and management to pull together – and therefore also for comprehensive and open communication in all directions: with the staff, with customers, and with the headquarters in Gütersloh. “We immediately established a constant flow of information to and from the CFO of Arvato Supply Chain Solutions and the heads of the Consumer Product and Healthcare divisions, and have been continuously supported by them,” reports Amati. A crisis management team has started work at the company, which meets daily and coordinates measures between the management team and the employees. The CEO sent an important signal by deciding that top management representatives would be physically present and work at the sites that are still open. To underline this, their offices were moved from the headquarters directly to the warehouses, where the employees are keeping the business running. Finally, Arvato Supply Chain Solutions in Italia regularly provides customers with information about possible delays or difficulties, but above all giving them the clear message: “We are fully operating, and we can support you as usual.”