According to McKinsey & Company there are 5 strategies industrial companies must take to recover from the COVID-19 downturn in business. These are Resolve, Resilience, Return, Reimagination, and Reform.
We can learn a great deal from what is happening in China. How their factories were affected, business trajectories, and how they are rebounding.
Resolve involves creating clear communication with staff, also determining if any changes to employment need to be made. Will there be any employee furloughs, cut back of hours or layoffs? Next is putting the safety of employees first. What safeguards can you put in place? Stagger shifts, limit employee interactions, do temperature checks, regular sanitizing, and so on. Continue to educate your workers on when not to come in if they are not feeling well or have been exposed to anyone who is sick, as well as their options regarding PTO, sick days, unpaid leave, etc. Have a line of open communication so employees can ask questions or address concerns.
One of the keys to this situation is reducing any business disruptions and having a plan in place in case work comes to a halt. Having collaborative robots in your machine shop can greatly increase your ability to continue production in the event your staff is unable to come in due to having symptoms or having the virus. If one person comes in with the virus and is asymptomatic it can quickly take out your entire staff.
Do your best to continue to communicate with your customers and meet their needs. Let them know if you are still conducting business, and regularly touch base with any updates or changes to your business that would directly affect them. Consider virtual meetings and virtual tours instead of meeting in person. Now is when customer service is key.
Address cash management challenges. Use other downturns you may have had in your business (such as the recession in 2007-2009) as a model for how to handle the current status quo. Maintaining clean balance sheets is imperative to your success. Also identify key risks and solutions to each scenario leaving you confident to tackle anything that comes your way.
According to McKinsey & Company, ramping up factories in a coordinated way will be mission critical. This will include four important phases:
– Preparation. Companies reach full transparency about systems, networks, and workforce, including the parts and people available.
– System filling. Leaders monitor their global supplier networks to ensure readiness.
– Stabilization. Employees become familiar with the new normal and prepare for volume increase.
– Ramping up. Companies produce the full product portfolio, matching supply and demand.
There may have to be an element of redefining how you do business moving forward. One approach is to take your sales approach to digital. In addition, there is a newer trend to rent or lease collaborative robots, which Fusion offers, if you cannot make the investment to purchase them.
Next, you may reevaluate your machine shop employee’s roles.
In addition, now may be a good time to evaluate any mergers and acquisitions.
This is an ideal time to consider more local manufacturing, so you aren’t so reliant on the global supply chain and any future potential upsets.
You can expect more employee flexibility with hours and remote working moving forward. You will also see that local-to-local supply chains will provide more flexibility and that vendors will be more accommodating.
Companies should take this situation as a learning lesson and create contingency plans for any future downturns in business.
For more information on how you can keep up on your production by investing in a collaborative robot, or to see how Fusion’s cobots have kept our machine shop running during this crisis, contact us at cobotics@fusionOEM.com.
Source: McKinsey & Company: Coronavirus: Five strategies for industrial and automotive companies