Last month, Ireflectedon how manufacturers were forced to adapt during Covid-19 and the impact it had on their businesses. I remarked that many changes they made are here to stay because they are fundamentally better business practices moving forward. Now, as we assess longer-term adaptations, the same can be said about the shift to work at home, the changing demand for American made products, and the technology and automation implications those trends bring.
Working from home is a new concept for most factory owners. Before March, when a question needed to be answered, people mobilized to the shop floor, often relying on ad-hoc interactions to get to the bottom of the pressing issues of the day. Nowadays, the opportunity for ad-hoc communication has been hindered, but the work that needs to be done hasn’t gone away. Processes that never got a second thought to become remote, automated, or virtual changed almost overnight, and we have heard great success stories here - distributing responsibility for tallying up jobs, creating dedicated communication points between personnel that used to rely mostly on ad-hoc interactions, and making it easier to reach virtual employees with more technology on the floor.
With this digital shift being thrust upon them, factory owners are looking at their businesses through a stronger lens of efficiency than ever before. The Wall Street Journalcoveredthis last month in the article, "Pandemic to Jumpstart Spending on Data Tools at Manufacturers,” and discussed how being able to monitor production remotely during the pandemic has made the case for even greater data capabilities. But it goes well beyond that: there is an aging workforce, there are processes that are in people’s heads, and have been for a decade or longer, some people are working reduced hours and aren’t in the facility, and these additive inefficiencies create a great opportunity to modernize and simplify.
As these investment opportunities present themselves, savvy owners are making strategic bets and building the factory of the future as they want it. It could be more modern inspection equipment, machines with better cycle times, getting a better beat on job performance, or trying to automate some of the black magic out of things like scheduling and planning.
Many of the owners we see being aggressive are doing so because they can reflect back on other trying periods such as 2001 and 2008, and wish they had done more to be better prepared for the recovery back then. Repatriation is a very real trend, demand is climbing in most sectors across machining, and cash/profit levels have been very good recently. Those that take the time to modernize and shake out inefficient processes today might feel like they’re just making incremental changes, but a few years from now, they’ll be heralded as the ones who had the courage to build the factories of the future, and they’ll win in stronger business environments because of it.