The article was originally published on kpmg.com by Richard Threlfall, Global Head of Infrastructure
Amid increasing public concern on economic and social impact of the pandemic, and reasonably strong fiscal and monetary response by most countries to contain the spread of COVID19, Infrastructure may not be a priority for policy makers in the short term as healthcare and unemployment support measures take precedence
However, it is crucial that infrastructure operators continue to facilitate the smooth provision of transport, connectivity and utilities services amidst a myriad of uncertainties. Public and private operators will need to strike a sensitive balance, prioritizing both the health and safety of customers and staff and the continued provision of critical services. This will require flexibility, the deployment of robust resilience plans and the utilization of smart and digital solutions. It becomes more critical in Emerging Markets of South and Southeast Asia as the supply chain linking sources of production and consumption may break down with impending/announced economywide lockdowns.
The impacts on infrastructure will be volatile and interconnected
Extreme events change the behaviour of society and infrastructure providers need to be ready to respond quickly.
We may see a potential down turn in the use of public transport in the short term but a sharp increase in demand for online purchase deliveries/e-commerce. Pressures will be felt on high speed broadband connectivity as there is a surge in remote working/telecommuting and online purchasing activity.
While retail malls and F&B establishments are getting impacted the most due to reduced footfall, those businesses who have geared up for online shopping and delivery would benefit. High priority services such as hospitals and emergency services may need to take priority in the provision of constant power and water supplies if shortages arise.
The impact will not be on one sector alone but across these interconnected systems of critical infrastructure services and will need a systems-based approach across sectors to identify the interconnected risks/impacts and to collaborate on where to prioritize efforts to keep the system moving.
Quick response requires robust resilience planning
Infrastructure providers are well versed in preparing for unexpected and extreme events and implement robust resilience plans to help them prepare and respond effectively. Whilst the virus itself does not impact the physicality of infrastructure assets there may be ramifications for maintenance, back and front office staff that in turn may limit the provision of services.
Prioritizing only essential maintenance procedures, running reduced services at of peak times and working to ensure the continued health and safety of workers will ensure operators can provide critical, whilst maybe not optimal services. Use of Data Analytics and AI based algorithms is helping utility operators prioritize maintenance scheduling to best meet the system requirements and continue to run critical services.
The role of digital enablement
Companies who have taken steps to embrace digital technologies will face less disruption than those still relying on more traditional and manual methods. Using smart scheduling/supply of service technologies and digital front and back office solutions will help ensure that disruption to the supply of services is minimized.
As we increasingly face threats in the form of weather disruption, pandemics and over population we see infrastructure operators placing risk, resilience and digital enablement at the heart of their strategies and adopting systems thinking to ensure the continued provision of services in extreme events across the infrastructure ecosystem.
This crisis has indeed tested the resilience plans of various players and sectors. Once this is behind us, it will be time for the ecosystem of players – developers, Government, financiers – to come together to strengthen the overall end-to-end infrastructure service delivery value chain. With most effective technology available at our finger tips, it is time for Emerging Market infrastructure players to leapfrog and “future proof and crisis proof” the infrastructure. With the Government’s desire to get the economy back on track by opening the treasury purse strings and immediate need to create jobs, the infrastructure sector could come out as winner – a backbone for path to economic prosperity at the fastest pace possible. We need to get ourselves ready for the ensuing challenge and come out technologically stronger, digitally connected, operationally resilient and environmentally sustainable.