The unexpected and sobering impact of COVID-19 is still reverberating across the manufacturing industry globally. For most manufacturing organizations, this is the most challenging period that they’ve experienced throughout their lifetime. The crisis affected manufacturers in three critical areas with labor, supply, and demand all hit simultaneously. Production capacity was instantly slashed as labor disappeared during global lockdowns. Supply of critical components was impacted with lead times ballooning. Next, demand was hit by changing consumer preferences in response to the crisis. Consumers began to stockpile FMCG items like toilet paper and face masks, and quickly reduced spending in many product categories.
We’ve put together a list of common trends happening in the manufacturing industry as factories and supply chains start opening up again.
Growth, decline or both?
The overall economic impact on manufacturing varies considerably by category. As some product categories like bicycles, FMCG, and health care are experiencing decade high growth, others such as luxury automotive are seeing unprecedented declines. As manufacturers recover from the disruptions brought about by the crisis, existing processes are being more closely examined. Previously overlooked weaknesses in production have now been tested with many delivering inadequate results, prompting much needed changes.
Laser focus on business continuity
Business continuity planning is front of mind as organizations scramble to reduce future interruptions to production. Supply chains previously considered robust have collapsed under new strains, and flaws in existing business models have been clearly exposed. Significant vulnerabilities with offshore manufacturing have appeared overnight, as Chinese suppliers shut their doors for weeks. Now, as reopening begins, business continuity will be the first item on the agenda of many manufacturing organizations. The introduction of multiple new variables will require businesses to develop and test many different scenarios. Enhanced focus on business continuity is set to continue indefinitely as organizations adapt to the new normal of post-crisis life.
Get safely back to business with these free business continuity checklists:
- Business continuity planning checklists
- Business impact analysis
- Compliance audit
- Crisis management plan
Local manufacturing is back
A well-recognized consequence of the crisis has been shifting consumer sentiment towards offshore manufacturing. While this trend had already commenced, it is now gaining momentum fast. Consumers are beginning to question the globalization of production and actively sourcing locally produced items. Product labels are being more closely examined, as manufacturers are bombarded with requests for ingredient origin. As an organic consequence of global supply disruptions, many local manufacturers are well placed to continue production. Immunity to supply constraints has provided local manufacturers with a compelling differentiator, instantly. As large competitors fail to deliver on agreed deadlines, local manufacturers have stepped in to absorb these orders. The consumer-driven trend is set to continue with new government incentives emerging to further encourage businesses to manufacture locally.
Free checklists for local manufacturers:
- Factory Reopening
- Manufacturing Facility Reopening
- Cal/osha COVID-19 General Checklist for Manufacturing Employers
- COVID-19: Screening Checklist for Visitors and Employees
- Social Distancing Plan Template for Workplaces Checklist
- COVID weekly GMP audit
- COVID-19 & Fresh Produce Protecting Your Workforce
- COVID 19 Employee Screening Questionnaire
Vacuums to ventilators and beyond
Manufacturers globally are retooling at the speed of light to meet new market demand. As existing markets contract, companies are using their vast resources and connections to help governments respond to the crisis. Dyson workers have gone into production overdrive pumping out much-needed ventilators for the NHS in the UK. While Brazil’s famous footwear brand Havaianas, has started producing everything from face masks to test kits. Japanese electronics manufacturer Sharp now has an entire TV factory dedicated to producing face masks. Even Britain’s Royal Mint in Wales has designed face shields for health professionals. Other companies like Tesla have leveraged overseas partnerships to source vital supplies that are desperately needed locally.
New players emerge from left field
Competition is springing up everywhere for traditional manufacturing brands. Disruption of incumbents is occurring at a frenetic pace across industries, and most businesses didn’t even see their new competitors coming. Existing businesses are shifting production into unexpected categories and capitalizing on new opportunities. However, the shifting in product categories is only part of the equation, as business models quickly adapt to market forces. High street cookie stores have shifted from selling retail biscuits to large-scale production of dough. Italian restaurants are now manufacturing pasta and competing with supermarkets. The breathing space and necessity of generating revenue throughout the crisis has proven to be the mother of all invention. The pace of change occurring across businesses hasn’t been seen since war times and may well change manufacturing forever.
Leaders demand safety data in real-time
The crisis has accelerated demand for real-time safety data, as leaders make critical operational decisions faster than ever. Increased compliance requirements, additional corporate responsibility, and shifting employee levels are some of the challenges. Previously, the digital transformation of safety information was considered optional – now it’s operation critical. Contactless electronic records are being used for safer, real-time monitoring of almost everything. Use cases range from monitoring compliance with new sanitation programs to faster completion of onboarding checklists for contractors. Many paper-based tools were already a burden to businesses – the crisis has just provided the push necessary for transformation.
Around 85% of manufacturing is already automated and completed by machines. However, the remaining workforce required has now been exposed as a significant weakness. Consequently, the cost-benefit analysis provides a more compelling case for industrial automation than twelve months ago. As manufacturers look to build additional redundancy, investment in technology and automation programs are considered key. The ability to fill gaps exposed by the crisis and maintain full production is essential for long-term survival and continued growth.
End-to-end supply chain visibility
Severe component shortages have hit manufacturers from every industry. Now, the difficult supply chain questions are being discussed in zoom meetings across the globe. Simple, easy to produce components have flatlined production capacity as supply evaporated. Even large multinational manufacturers have been crippled by supply issues with seemingly insignificant components that weren’t even on their radar. Many of the issues could have been better managed with enhanced visibility of the entire supply chain. Pre-crisis many manufacturers only had visibility of their primary or secondary suppliers, who managed additional sourcing requirements. Manufacturers are now investing in the entire supply chain’s visibility, down to individual components or raw material sourcing
From producers to digital health advisors
Manufacturers have adopted the new role of health advisor to employees. As important information on the crisis is discovered, companies are using digital devices to educate staff. From cascading health bulletins to providing virus updates or requesting daily health surveys. Early access to information in both directions has become a competitive advantage across organizations. Digital tools are providing senior leadership teams with the data required to make difficult decisions on the fly.
Free checklists to help you protect your people:
- PPE Safety Inspections
- Temperature Log
- Social Distancing in Communal Areas
- General Guidelines To Protect Employees & Customers
You can’t eat here anymore
Many companies have started allowing workers to reduce their daily work hours by thirty minutes to facilitate home eating. Social distancing requirements have presented unique challenges in communal areas used by employees. In particular, meal rooms used by workers throughout breaks in production have become problematic. As many organizations operate with fixed floor space, accommodating social distancing quickly reduces meal room capacity. The lack of capacity has forced organizations to implement these novel solutions to maintain production levels.
Free checklists for social distancing:
- Physical Distancing Checklist
- Social Distancing Plan
- Social Distancing in Communal Areas
- COVID Dining Room Inspection MM Checklist
Mind the gap
Before the crisis, production line workers manufactured goods side by side with other employees, and close physical proximity wasn’t an issue. Now, every single human touchpoint is considered an unacceptable risk. This has resulted in manufacturers globally reconfiguring production lines, modifying tasks, and reducing interactions to meet social distancing guidelines.
New physical dividers are popping up everywhere in factories across the globe. From plastic screens for security personnel to production space dividers, and enclosed receiving docks. Manufacturers have quickly embraced the trend of separating employees using plastic. Using enhanced physical separation tools to reduce transmission will likely become an ongoing requirement for manufacturing organizations. Eventually, the sight of plastic separation screens in factories will appear as normal as gloves in a hospital.
Clean it, now clean it again
Shared machines, tools, and touchpoints are an unavoidable reality for many manufacturers. To ensure employee safety and reduce transmission of viruses, many organizations have stepped up sanitation programs. Previously, cleaning of common equipment was completed daily or twice daily. Now, that has accelerated to several times per hour or more. In many cases, companies have hired specialized cleaning firms to complete these tasks, underscoring the need for additional digital reporting tools. The challenge manufacturers now face is ensuring that contractors complete cleaning tasks to the standard required. In addition to formal satiation programs, workers are now being encouraged to use resources like hand sanitizer liberally, to manage their own risk of infection.
Free checklists to prevent the spread of coronavirus:
- Prevention And Mitigation Of COVID-19 At Work Action Checklist
- COVID-19 Checklist for Employers and Employees
- COVID-19 Prevention and Work Practice Controls Checklist
- COVID-19 Cleaning and Personal Hygiene Inspection
- Cleaning Checklist
- Hand Hygiene
- Infection Control
- Legionella Risk Assessment
Spot, the safety marker
As production employee numbers return to normal levels and production capacity increases, organizations are racing to implement social distancing markers. From bright, painted lines separating staircases, elevators and entry points to round spots covering floors. These new markers and signs are providing workers with an important visual cue that this isn’t business as usual, at least not yet.
Time to flex your shift
Standardized start and finish times for production workers aren’t always achievable post-crisis. Many manufacturers have been forced to implement staggered shift patterns during reopening. The new shift patterns provide reduced contacts between workers, while still allowing companies to meet production volumes. Other organizations have increased operating hours to allow for more shifts throughout the workday.
Cupboard or kitchen?
Existing production areas are being quickly repurposed as organizations require more floor space than ever for social distancing. Manufacturers are recovering additional square feet everywhere from outdoor gardens to car parks, and even storage locations. Fast space transformations are allowing organizations to maintain peak staffing levels safely at minimal extra cost.
The information contained in this article is general in nature and you should consider whether the information is appropriate to your specific needs. Legal and other matters referred to in this article are based on our interpretation of laws existing at the time and should not be relied on in place of professional advice. We are not responsible for the content of any site owned by a third party that may be linked to this article. SafetyCulture disclaims all liability (except for any liability which by law cannot be excluded) for any error, inaccuracy, or omission from the information contained in this article, any site linked to this article, and any loss or damage suffered by any person directly or indirectly through relying on this information.
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