Category: Profit through People

What’s Going On Around the World?

July 11th, 2020

After receiving questions from multiple people about “What’s going on in Asia?”, we dug into what’s going on around the world (at a high level). In today’s globally-connected world, it isn’t a question you can ignore!

Starting with Asia, from a supply chain point-of-view, product continues to move. All three China ports are open and the volume has picked up. China’s capability was back up to at least 80% of the pre-coronavirus levels. However, once China started ramping up after the first infection wave, N.A. and Europe were under lockdown, impacting customer requirements. According to CEOs from across the U.S., they experienced delays initially but it is largely back to ‘normal’. On the other hand, we are also hearing that some folks are experiencing extended lead times. It certainly can depend on the product, material, specific supplier, etc.

Customers that switched supply to Vietnam prior to coronavirus have experienced high levels of service and are generally happy. While there aren’t a lot of numbers coming from Vietnam, it appears as though manufacturing has largely carried on to the levels needed. Of course, if you were in process of transitioning to Vietnam when coronavirus hit, it probably has been put on hold. India shut down for a month during coronavirus but started up essential manufacturing early in the ramp up. India hopes to ramp up manufacturing as companies accelerate the de-risking process from China whereas Vietnam is already in that position and hopes to expand. Japan and South Korea largely carried on through coronavirus. The only noteworthy disruptions were caused by shortages of supplies from their extended supply chain. Overall, there were initial delays with Asian supply, and the degree varied quite significantly based on the source of supply.

With that said, there are increasing levels of concern about a second wave of coronavirus hitting the Asian supply chain. Beijing has been in lockdown with surging cases of coronavirus. Although not integral to the supply chain, it is a bad sign of potential negative impacts to come. It is recommended to bring inventory in ahead of the holiday season and to be cautious with paying cash upfront as several small and medium size Chinese suppliers are struggling.

In Europe, it varied significantly by country. German manufacturers kept operating throughout the coronavirus lockdown. Since they saw the virus coming from what happened in Asia, they implemented social distancing and other protocols throughout rapidly. Certainly, Spain and Italy were impacted more severely and shutdown for a period of time. Several European and U.K. car manufacturers shutdown due to lack of demand and significant disruption in the supply chain. Aerospace companies in the U.S. experienced issues receiving essential components from Europe during the pandemic. Overall, CEOs across the U.S. said that supply from Europe wasn’t interrupted significantly.

U.S. manufacturers of essential products were largely able to continue producing. Of course, depending on the customers’ served, volumes dropped dramatically and disappeared (suppliers to hospitality for example) or experienced aggressive growth (lawn and gardening, toilet paper, PPE).  However, on average, volume dropped to 50-70% of the pre-coronavirus levels. CEOs from multiple industries have said the biggest issue has been disruptions in the supply chain. There are examples of essential U.S. manufacturers experiencing issues receiving materials/component parts from Mexico, Europe and Asia. Not every country had the same definition of essential. Consequently, there is a lot of talk about regional manufacturing and reshoring.

Brazil has been hard hit with the coronavirus recently, and manufacturers have been forced to shutdown. No part of the world has escaped this pandemic! Thus, the global supply chain has come into the forefront and is taking a seat at the table. Are you going to chase your supply chain or build appropriate diversification and flexibility and identify acceptable levels of risk upfront in your strategy discussions?

We are seeing a surge of supply chain strategy assessment and roadmaps. Are you evaluating your supply chain so that you can take charge of your future? There is no such thing as no risk.  Understanding your customer profiles, changing customer requirements and associated product supply strategies is a place to start. If you’d like to discuss your strategy, please contact us.

 

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What’s going on with Your People?

July 8th, 2020

Do You See People as Assets or Costs?
Your people know what you really think. Do you value them? Even though there has been a sharp spike in unemployment, good talent isn’t easy to keep! Multiple clients have lost talent to better opportunities since COVID-19 started. People are on the move.

Are You Attractive to Potential Employees?
Top talent will not sit idle. A colleague and former client who is an excellent find for any manufacturer found a new job in a matter of a few weeks when downsized during COVID-19. It was an exciting opportunity.  She was attracted to the potential in the new job. I am 100% confident that they will pat themselves on the back for snapping her up.

Several CEOs have mentioned that they are taking the opportunity to look for talent to fill key roles during the pandemic. They are being selective on the roles, but they are taking that step forward during these uncertain times. Remember, good people attract good people!

My Favorite Client Story of Relevance to the Topic of Talent
At the bottom of the Great Recession, the CEO of an outdoor lighting manufacturer had no need for additional employees. In fact, the CEO was experiencing the same issues as everyone else. His competitors cut salaries and let people go. Instead of following the herd, he went in the opposite direction. He hired one of the engineers cut by a competitor even though he had no immediate work for the engineer. In another situation, a job seeker stopped by the facility. The CEO was so impressed with this candidate’s go-getter attitude that he hired him on the spot and figured he would find a good spot for him. Fast-forward several years, and he was #1 in his industry and getting ready to introduce a new product lineup to a secondary industry (designed by the engineer) and ready to make a significant shift from engineer-to-order towards configure-to-order with an ERP upgrade that would prepare him for success for many years to come. None of this would have been possible without valuing people.

Read our eBook, Future-Proofing Manufacturing & Supply Chain Post COVID-19 to hear about additional strategies to lead, keep your teams moving forward, and engage your people in the future. Please send your feedback, stories and ideas. We believe manufacturers have a unique opportunity for growth and success if they innovate and focus on the opportunities during COVID-19. To achieve this potential, you have to start with your people.

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The Value of Diversity

July 5th, 2020

Diversity has always been core to success. Are you gaining different viewpoints? It has certainly been proven that deliberately bringing diverse viewpoints into projects and teams will lead to greater levels of success. Men will have different perspectives than women. People with different nationalities and backgrounds will bring different viewpoints into the mix. People of different ages will have differing priorities and opinions. Are you bringing diversity into the conversation?

I can definitely tell you it isn’t as easy as it sounds. I didn’t even realize I was the only woman (and also the youngest person) attending the Board of Directors meetings when I was VP of Product Supply until one of my team members brought it to my attention. You’d think it would be hard for me to miss! I also remember a time during my consulting career when I really enjoyed participating in a group. We had a good working relationship and were quite successful. A potential new member came onto the scene. My first thought was “NO!”; however, I agreed, and she turned out to add great diversity, and the group was better for it. Good thing I ignored my inner voice!

One Tip to Implement This Week:

Simply pay attention for opportunities to insert diversity into your projects, events etc. You’ll be surprised by what you miss while focusing on the task at hand. Again, during my career with APICS Inland Empire Chapter (Association for Supply Chain Management), I missed the lack of diversity on our panel. Our audience noticed and commented in our survey. In this case, it was an all male panel. Our chapter has held 15 executive panel and networking symposium events, and this panel was the ONLY panel without a woman. Of course, over time, we have improved upon this metric in addition to male/female (although that can sometimes be tough on its own!) with panelists from multiple countries, backgrounds, age groups, work backgrounds (in addition to manufacturing and distribution, we’ve added healthcare, technology and more), etc.
Start by simply paying attention and giving a diverse group a chance. Be open to the idea, and you might just gain significant value.
Stay safe & healthy.


The Future of Manufacturing & Supply Chain

June 17th, 2020

It is a very exciting time for those of us passionate about manufacturing and supply chain. Undoubtedly, we have never worked harder proactively managing the unprecedented demand and supply volatility, and so appreciate your supply chain resources. I am hearing that they are taking off for better opportunities, and you won’t want to lose your best talent during what will be a lengthy and supply chain intensive COVID-19 recovery!

As manufacturing increasingly returns to the U.S., as consumers and businesses expect a superior, customized, rapid delivery of products and services, as technological advances become commonplace, as the general public sees the value of essential businesses and the diversity of manufacturing and supply chain, it will be a great ride! Are you shaping your future or waiting for it to happen to you? Join me in a webinar to hear more.

One Tip to Implement This Week:

Simply start thinking about the future of manufacturing and supply chain in your industry, your region, and as they relate to technological advances and innovation. Bring your team together to get them thinking about the future, new ideas, and how to proactively position your company for success. A LOT can be accomplished simply by refocusing attention to thinking proactively, creatively and with a focus on the future. Will there be opportunities to pick up new business, design new products and open new markets as firms want to bring manufacturing capability back to the U.S. and closer to customers? What do your customers need that they haven’t thought about yet that would help them be more successful?

 

 Listen to a panel discussion with manufacturing executives related to the electronics industry on the Future in Manufacturing panel to stimulate ideas and flip through my eBook, Future-Proofing Manufacturing & Supply Chain Post COVID-19 to gain new insights to get the ball rolling. We have also launched a rapid Future-Proofing Manufacturing & Supply Chain assessment if you’d like assistance in thinking through your particular situation. Contact us if you are interested. Stay safe and healthy.



Being Featured on Bloomberg & the Rise of Reshoring

June 3rd, 2020

Of course, it was very exciting to be featured on Bloomberg’s ‘What’d You Miss?’ show! It speaks to the rising popularity of reshoring that Bloomberg is searching for supply chain experts to talk about reshoring and whether it makes sense.

NOTE: I am about half-way through the segment if you’d like to watch the show.

As I said on Bloomberg, of course, the answer of whether you should reshore is “it depends”; however, it is becoming quite attractive for many industries and situations. At a minimum, review whether it makes sense to source manufacturing closer to your end customers. If you need a push, look no further than the Amazon-like customer requirements, increasing labor costs in China, the lessening importance of labor costs as the Future in Manufacturing panel discussed, the risk of disruption (tariffs, COVID-19, natural disasters etc.) and more. I discuss this topic in depth in my eBook, Future-Proofing Manufacturing & Supply Chain Post COVID-19.

 We have also launched a rapid Future-Proofing Manufacturing & Supply Chain assessment if you’d like assistance in evaluating for your particular situation. Contact us if you are interested. Stay safe and healthy. We continue to post coronavirus resources, write blog articles on navigating coronavirus as well as “beyond lockdown” strategies, and we are sponsoring APICS Inland Empire‘s “Navigating Through Volatility” webinar series. Join us and learn more here