Collaboration and knowledge sharing are critical for manufacturers combatting the coronavirus and readying for recovery.
by Joe Galvin, Vistage Chief Research Officer
During these unprecedented times of slow-downs and shut-downs due to the COVID-19 crisis, there are some bright spots of creativity, innovation, heart and hard work happening in the manufacturing sector. From a thermoplastics manufacturer in Pennsylvania pivoting their operations to produce medical devices to a producer of plastic covers for furniture and home goods near Chicago now making plastic shields for medical workers, manufacturers across the country are transforming their operations to make a difference during this time.
Rate of Change Fueled by Collaboration
The rate of change taking place at many of these manufacturing operations is unprecedented and demonstrates the ingenuity and innovation that are hallmarks of our manufacturing industry. These transformations are also being advanced through collaborations and knowledge sharing happening throughout the industry. At Vistage, we are seeing these types of collaborations taking shape on our online Manufacturing Industry Network, where members share ideas, get advice and solve problems. Manufacturers are using the network for gathering opinions on how and when to safely ramp up production, gain tips for keeping workers safe on the production floor and learn more about business continuity planning.
Networking is also a big part of what’s happening – from sharing contacts for sourcing raw materials needed to produce products for the medical industry to who can help distribute face masks, making sure they get to the front-line medical teams that so desperately need them. Manufacturers are working together to keep their businesses going or pivot to help in the fight against coronavirus.
Today’s Industry Mindset
Despite all of the good happening, the manufacturing industry remains extremely concerned about business going forward. According to the April Vistage CEO Confidence Index, more than half (61%) of small and medium-sized manufacturers say they expect the overall economic conditions in the U.S. to be worse during the next 12 months.
Nearly seventy percent of these manufacturers report their revenues have declined as a result of coronavirus, and a majority also expect their revenues to continue to decrease in the next year. Manufacturer CEOs also cite significant disruptions to their businesses, including:
- 59 percent report disruption to their supply chains
- 53 percent say they are experiencing delays in their ability to service clients
- 58 percent cite impacts to employee productivity
Weathering the Storm
Leading a company at any time is challenging and can be even isolating if the leader doesn’t have an established network of peers or other trusted advisors to turn to for advice. During a crisis, especially the COVID-19 pandemic, the feeling of isolation can be magnified as so many manufacturers are largely on their own to figure out how to operate in this unprecedented situation. Networking, collaborating and brainstorming with others can sometimes mean the difference between failure and survival. Manufacturers, like all business leaders, are learning every day as the crisis continues. Sharing these insights and learnings can be a lifeline.
Leaders can leverage the following tactics to not just survive, but build a stronger foundation for ultimate recovery:
- Overcommunicate with everyone. Keep the lines of communication open with all of your stakeholders, especially employees and customers. The more you communicate now, the better.
- Capture your culture in action. Use this opportunity to showcase how your company reacts in a crisis, and how your employees respond. By reinforcing the strength of your company culture during this time, your culture will actually grow in importance and help your organization stay focused on the fundamentals: people, mission and values. Customers and other stakeholders will take notice as well.
- Watch for indicators that business is picking up. Constantly monitor rate-of-change data and use it to gauge when and how fast business is picking up. This will help you know when to pull the trigger on moving your new normal forward.
- Accelerate digital transformation. Continue to upgrade your digital technology in the interest of two goals: One, to advance your business, production and efficiency goals; and Two, to help prepare for future disruptions and crises.
Road to Recovery
While no one yet knows when recovery will begin, manufacturers are thinking about what their new normal may look like in the future. Half of manufacturers say they expect their businesses to be moderately weaker but beginning to regain momentum in the next six months. Another 43 percent anticipate economic conditions in the U.S. will begin to improve within three to five months.
While there are still many unknowns, it is clear that the road to recovery will be paved with lessons learned during this crisis. It will take all of us working together to drive the industry down the road to recovery and continue the ingenuity and innovation that will leave the industry transformed and stronger in the future.
Joe Galvin, Chief Research Officer, Vistage
As chief research officer for Vistage, the world’s leading executive coaching organization for small and midsize businesses, Joe Galvin is responsible for providing Vistage members with current, compelling and actionable thought leadership on the top issues, topics and decisions of small and midsize business CEOs.
About Vistage Worldwide, Inc.
Vistage is the world’s largest CEO coaching and peer advisory organization for small and midsize businesses. For more than 60 years, we’ve been helping CEOs, business owners and key executives solve their greatest challenges through confidential peer groups and one-to-one executive coaching sessions. Today, more than 23,000 members in 20 countries rely on Vistage to help make better decisions for their companies, families and communities. The results prove it: Vistage member companies grow 2.2 times faster than average small and midsize U.S. businesses, according to a 2017 study of Dun & Bradstreet data. Learn more at vistage.com
To find more resources to help you navigate the coronavirus epidemic, visit Vistage’s Leading in Challenging Times Resource Center.
About the April Vistage CEO Confidence Index Survey
The April Vistage CEO Confidence Index survey data includes responses from 1,611 SMB CEOs and key executives collected April 1–8, 2020. Daily responses did not vary over time during the survey period, suggesting that this data captured the new baseline of business activity until quarantine levels change. The demographics of our survey include a variety of industries, including nearly three-quarters of respondents representing manufacturing, construction, finance/accounting, consulting services, wholesale trade, healthcare, business services and computer systems. Some of the harder-hit verticals, like hospitality, entertainment and travel, are not fully represented in this survey.