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Managing through a downturn in the 21st century

During my career I went through a number of downturns in business. Because I worked for public companies, there was always pressure to reduce costs during these times. As we know, expense walks on two feet. Thus, I did reduce headcount during downturns many times. I think that things surrounding business in the United States today are different and may require a different response. In this blog, I will put forth an alternative approach which may be more fitting for the times we live in now.

Most of the industrial manufacturing businesses leaders I have talked to in the past several years have almost always complained about the same subject. “I can’t find skilled labor to fill the positions I have in CNC machinists, welders, and other trades.” Thus, does it make sense to layoff the critical skills you already have just to make the bottom line better in the near term? I say NO.  You may be asking yourself what you should do when you don’t have the work to keep them busy. The answer I believe is to utilize their skills to do the operational improvements that you didn’t have time to do when your business was booming.

Most industrial manufacturing leaders when pressed would agree that there are opportunities to improve productivity and efficiency in their factories through the implementation of lean principles. USE THESE VALUABLE PEOPLE to help you make your industrial manufacturing operation more efficient. I’m sure if you gathered your operations people together (including skilled labor), you could come up with enough improvement projects to keep everyone busy for a year. I suggest that the payback on this investment will be tremendous when the super busy days come back.

When you get done with the improvement projects and things are still slow, invest in your people through cross training and other people development programs. By doing this, you illustrate to your workforce that you care about their futures. The payback will come when you get busy again. Because people have added skills during the downturn, they are likely to be more efficient and productive when things get busy again.

The purpose in all of these discussions is to avoid what I explained in paragraph two. The state of most industrial manufacturing businesses for the last ten years or more has been trying to find enough skilled labor to handle growth. If you have the courage to invest in the future as I have described above, you may come out of the downturn not needing additional skilled labor. The skilled labor that you have will now be operating more efficiently and have additional talents that give you flexibility to move people around as demand dictates.

This is definitely a different way of thinking and appropriate for the environment we are faced with in the 21st century. If you need help managing your way through this, I can help.

Contact me at: Warren@15consulting.com, or my mobile 815-988-4562.

Warren Martin

Founder

15 Consulting

March 2, 2020

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