What will bring manufacturers through COVID-19 – lessons from the GFC

Australian Manufacturing Forum member viewpoint by Kerrie Clarke

Last time manufacturing collectively hit a wall was during the 2009 GFC.

As author of Manufacturing Skills Australia’s Environmental Scan reports, I monitored the journey over several years. We learnt that without doubt, Australian manufacturers have proven over and again that they know how to put up a fight. They have navigated their fair share of challenges and for the lucky ones, the GFC was yet another.

So, what did we learn about survival then – this is what manufacturers said:

Covid-19 recovery lesson 1. Recovering from the GFC manufacturers used the down-time to train, upskill and prepare the workforce for new work tasks and work practices. Employers were determined to maintain skills and capacity and adopted a range of strategies to keep workers. In particular the high-level skills today’s advanced operations count on. All efforts were made to retain them.

COVID-19 has changed the way we are working, and some of this is bound to stay. Online meetings and interactivity, working from home and variable shifts all help to reduce costs and increase efficacy of how we share information, support and knowledge. Flexibility in the way we keep employees engaged will be key moving forward.

Thoughts for today:

 Encourage workers to video best practice operations to share with others – use the time to build a learning community

 Engage staff in problem solving – this is a great opportunity to promote innovative thinking!

 Access online courses to upskill/train employees

 Target skill development in new business activities

 Engage workers in every outstanding job you can find – make sure all WIP is up to date; share workers across sites

 Set up online webinars / peer learning sessions.

Covid-19 recovery lesson 2. Many manufacturers speeded recovery from the GFC and re-imagined their purpose and adapted business models to pursue new opportunities. They diversified their product and service range and consolidated parts of the business.

Some redirected investments. Certainly, post COVID-19, many businesses will emerge in a different shape or structure. Disruptive forces are an opportunity to review what is and isn’t working, and how the organisation can become more agile and responsive to volatile conditions.

Thoughts for today:

 COVID-19 is probably not the last disruption of its kind. Be sure to notice all the impacts and engage your teams in generating mitigation strategies

 Agility is key – review what in the business keeps you fixed and inflexible

 Hold visioning sessions to re-image what’s possible for the organisation. A great time to get really honest about what you want to deliver – and what you want to leave behind post crisis.

Covid-19 recovery lesson 3. Most successful manufacturers emerging from the GFC became (even) leaner and more efficient and sustainable. Manufacturers always need to be lean and efficient, but tighter trading conditions make this ever more important. People lose jobs in a downturn and more links in the supply chain disappear. However, pandemics may prove to raise even more questions about the efficiency of a dependence on global supply chains and free market forces.

In 2009 manufacturers were waiting for clear government commitment and leadership in the quest to mitigate climate change. Without it, they just got on with it (as they do) and many benefited from the savings of their sustainability strategies.

Enterprise and industry leadership will still be the critical factor in successfully creating a strong and sustainable Australian manufacturing industry.

Thoughts for today:

 Train in Competitive Systems and Practices across the business during the downtime

 Examine what can go, and how operations can be more cost effective, efficient and environmentally sustainable – it’s a long-term plan

 Participate in public conversation about the need for local manufacturing capacity, investment and support. There has never been greater evidence than a de-tooled industry asked to ‘tool up’ to respond to crisis.

Covid-19 recovery lesson 4. Manufacturers focused on strong leadership and effective management. The ability of the leadership team to address concerns, demonstrate a commitment to workers, and provide regular, clear communications, are all vital in minimizing the impacts on staff and customers, and keeping connection, even while everyone is at home!

Many Australian manufacturers (especially SMEs) have struggled with management skills – this is certainly a time that work arrangements, business strategy and productivity will be in focus.

Thoughts for today:

 Work closely with your executive team – times like these need creative thinking that embraces perspectives from across the organisation

 Use a consultative, flexible and responsive management style to address the challenges proactively – your employees will have differing needs and concerns for you to navigate and negotiate

 Instill organisational vision and values into problem solving exercises

 Support leaders to emerge – this is a time when natural leaders will step up

 Sign up for a management training – it’s never too late!

Covid-19 recovery lesson 5. Some manufacturers collaborated with aligned partners. During the recovery of the GFC, new alliances formed to create new products, services and supply chains, and contribute in research and development projects. There is strength in numbers and collaboration helps to close all the links and get results.

Thoughts for today:

 Seek out alliances, partnership and collaborations that will strengthen your response to this crisis – working together is the only way

 Seek out new business models that offer more sustainable, resilient operations

 Initiate, participate, collaborate in research and development projects that strengthen the industry (review available government grants to help you).

Cvid-19 recovery lesson 6. Successful manufacturers held a strong vision for the company and industry. We are seeing the negative impacts of a dependence on offshore manufacturing. This is a time for manufacturers to clearly articulate their vision for the future, and ask the big picture questions … is local manufacturing capacity critical to ensure the health and wellbeing of its country? Is an ability to be agile and responsive to disruptive circumstances an asset for navigating these turbulent days? What are the critical sectors we need to strengthen in our national interest?

Thoughts for today:

 Engage your leadership team to renew the organisational vision

 Seek a vision that engages the biggest part of you and your capacity

 Commit everything you have to making it real.

The resilience and agility of our manufacturers will again be tested as we emerge from the Covid-19 pandemic, but we know that they are amongst the most experienced in the world at finding a way through tough times.

It is time to move past the disbelief and shock and into some big picture thinking. It is time for resilience, adaptability and renewal. Manufacturing Australia … make this your time.

Kerrie Clarke works in skill development and communication across manufacturing and was author of Manufacturing Skills Australia’s Environmental Scan for six years. Today she is a copy writer, coach and facilitator.

Picture: Kerrie Clarke

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