Struggling, manufacturers? It’s time to panic!
We are experiencing a bifurcated recovery, with large sectors almost fully recovered and others struggling to find any traction at all. The same is true within the manufacturing sector and that worries me. If you are a manufacturer that isn’t recovering, it’s time to panic!
Manufacturing as a whole is making a strong and steady recovery. Recovering manufacturers changed their operations to address the COVID safety concerns of their employees and customers. They found new ways to use creativity and technology to improve their companies’ competitiveness and were ready to respond when their customers returned.
Struggling manufacturers are still looking for traction. We see them in two areas — those that were paralyzed by the virus and those that serve hard-hit markets like travel and hospitality. These operations face twin challenges of needing to rapidly improve cash flow and finding a viable path to recovery. In the meantime, their competitors are quickly leaving them behind.
If you are a struggling manufacturer, it’s time to panic! Face your most difficult issues head-on and build momentum to face future challenges. Start with cash flow and stop the hemorrhaging now. Take a no-excuses approach by creating a weekly cash projection with specific action steps and holding your team responsible for the results. This will buy time to make longer-term changes.
Next, make a steely eyed assessment of your company’s position and where change is needed. Look outside to your markets and your position in them, and also to adjacent markets where new opportunities may exist. Look inside to find operational bottlenecks or chronic issues needing more attention. Build a specific plan that engages your people and aligns them in ways that create the most impact. If you doubt your ability to create these changes or be objective about what’s needed, get help from the numerous Wisconsin resources specifically available to manufacturers like you.
There is no time to delay. Just like at the end of the Great Recession, there is a record amount of cash on the sidelines ready for investment. Leading companies are using that cash to transform their operations. New technology enables these leaders to reform their operations, products, and services to anticipate their customers’ needs and fulfill them in ways that weren’t possible even a few weeks ago.
These companies are also upgrading and upskilling their workforces. The pandemic provided opportunities to recruit talented people who were unavailable at the beginning of the year and the best companies added those people to their workforce. They also used the time freed up by reduced production schedules to upskill their incumbent employees. Companies improving their workforces will come back stronger than ever.
The leaders are also taking advantage of this turmoil to reposition their businesses. General upheavals in world markets and disrupted supply chains provide opportunities for strong companies to expand and become even stronger. These companies invest time and treasure to become more competitive by improving efficiency, flexibility, and resiliency simultaneously. New technologies make all of this more practical and dynamic than ever before.
Leading companies are recovering and improving their businesses. If you are still waiting for the end of the pandemic, it’s time to panic!
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