MANUFACTURERS AND COVID-19:  BEYOND THE SHORT-TERM CRISIS

Posted by Tom Comstock on Thu, Apr 16, 2020

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LNS Research recently hosted an Executive Roundtable online with manufacturers about their responses to the global pandemic.  Manufacturers are working closely witjohn-cameron-zxsab1OdEsU-unsplashh their local and national public health institutions, unions and Worker Safety organizations (such as OSHA in the US) to develop plans on how to react to the crisis unfolding in front of them.  It should come as no surprise that most manufacturers were quite short-term focused.  Few manufacturers reported on developing medium- or long-term plans yet. 

Public Health officials and epidemiologists, though, are talking about “waves” of the virus over the next 18+ months so a medium- and long-term planning will be appropriate soon.  Prudence would suggest that manufacturers not be caught flat footed if society and supply chains are challenged again.  We see six factors as particularly relevant:

  1. Inventory levels: Supply chains across several industries have been challenged by the impacts associated with the virus. Companies should be making a conscious decision about inventory levels they will want to maintain (restock) in the near future to offset any future disruptions.  Of course, manufacturers should be looking at the other two buffers in the supply chain, capacity and lead times, as they make these inventory level decisions.
     
  2. Making facilities more conducive to “Physical Distancing”: Alternative factory layouts with more distance between workstations may keep more facilities operating at or close to capacity.   Simulating alternatives “now” may highlight alternatives that could be available with small changes to the physical plant currently or down the road.  Those simulations should include options like expanding the physical facility with temporary office or warehousing options.  This seems to be particularly important to “essential operations” such as food and beverage manufacturers.
     
  3. Alternative suppliers in different geographies: The pandemic has not hit all regions around the globe at the same time, so various plants have been impacted at different times.  Specifically, looking at qualifying vendors in multiple locales may improve agility in the future.
     
  4. Remote monitoring: The goals of social distancing encourage as many workers to work from home as possible.  Remote monitoring of assets and production are areas that technology can readily enable and can be deployed relatively quickly.  Many technology companies are making it available at no charge in this first wave (see additional blog on this topic here). This may be a technology priority over the next 18 months to prepare for any future waves.
     
  5. Update your Risk and EH&S Guidelines to include Pandemics: Be prepared with a comprehensive infectious disease preparedness and response plan that considers a hierarchy of control measures, such as engineering controls, safe work practices, training and other administrative controls, and personal protective equipment (PPE).  And follow-up that planning with a commitment to the resources required to execute that plan including procuring PPE for your plant personnel. (Of course, please make those purchases as the virus’ “curve flattens” in your country).
     
  6. Connected Worker: Closely related to recommendations four and five above is the empowerment of the Connected Worker, who with the right technologies, can work more safely and efficiently.  Additionally, the Connected Worker is able to do more types of work, supported by the connectivity to data, as well as guidance from Subject Matter Experts (SMEs) and other operational personnel. 

LNS is not a public health institution.  We cannot forecast the actual trends of COVID-19.  Hopefully, vaccines and therapeutics will make any future wave of COVID-19 dramatically less significant.  But, we have learned, along with so many of you, that some prior planning can reduce impacts later. Let us know what you are considering in your medium-term planning so we can share it with other manufacturers. Please use the comment area to share; we appreciate your input.

Categories: Supply Chain Management (SCM), COVID-19