COVID-19; Is it time for an Industrial Reset?
Forward: As is often the case within the industrial complex, cost-benefit analysis considers profitability to be a key factor to success. In addition, there are times when historical references are often overlooked, or dismissed as non-critical to the success of the enterprise. For any business, profitability must never be discounted, but continuity, the sustainability of materials flow, and finished goods must be part of the foundation when assessing true profitability and risk.
In the case of COVID-19, the impact of not being prepared for such an event is a hard but real lesson that manufacturers, suppliers and retailers need to take seriously.
Are we witnessing the next generation of Manufacturing and supply chain Logistics?
As Global society struggles with COVID-19 and its impact on individuals, small businesses, and industrial giants, one thing is clear. Business continuity, and disaster recovery planning, were no match for the microbial spread of the Virus. This factored with the actual test of sustainable supply channels for manufacturing, agriculture, textiles, and the dependencies built on those channels such as grocery, pharmaceutical, medical supply, and day-to-day needs of consumers, it becomes apparent we are on the threshold of a true reset in thinking when it comes to manufacturing and distribution of goods.
Having witnessed the offshoring of manufacturing, supply components, technology resources, and decision making, all intended to offset their cost in the name of industrial growth and profit, it is clear several components were not considered or dismissed while developing the growth strategy.
We are now in a position to evaluate and consider all of these issues, and how we as a culture can genuinely learn from this epic disruption; we must develop a plan to rethink, energize, and grow our manufacturing culture and maintain a scalable supply chain.
We do live in a data-driven culture where data modeling and projections are used to influence decision-makers and stakeholders as well. Often ignored and overlooked are potential environmental disruption factors related to global events such as the spread of disease, which is now a real-world example of disruption, and which has touched countless millions.
Much is being made of various “data” models appearing and disappearing in the media and through various channels, regarding the spread of the Virus as it relates to the economy and the supply of goods and services. If we step back from “data” and look at the real impact of the virus outbreak has had, there is only one conclusion. The industrial systems we have trusted for decades require an overhaul!
The Next Industrial Revolution
As we consider an Industrial Reset in “Manufacturing & Supply Chain” initiatives, we must rethink not only the traditional manufacturing models now commonly used to justify offshoring critical components of our supply chain. We must also develop redundancies within our supply chain mechanisms to enable true sustainability in preparation for the next global pandemic, environmental, or political disruption.
To accomplish a successful Industrial Reset, true “Foundational Thinking” by decision-makers and stakeholders must be quickly adopted. A new industrial manufacturing methodology must be built utilizing lessons learned, coupled with innovation, and acceptance that cost is only one component for consideration, coupled with managing the supply chain, the risk to businesses and consumers, and the overall well-being of the economy. These components are critical to building a new and more resilient foundation.
In my narrative “A Slender Thread” published in 2018, I referenced a presentation delivered in 2007 by Joe McGrath, formerly CEO of Unisys Corporation at the “World Conference for IT” in Austin, Texas. I submit that now nearly 14 years later, the challenges of a sustainable supply chain have been amplified by expanded Globalization. In contrast, the need for truly critical redundancies in supply chain channels has been ignored.
Lessons Learned
We have, in our midst, the means to build the necessary foundation to sustain manufacturing, and reinforce the supply chain challenges. The question is, will we do it?
