This is a significant structural break and some of our operating models may change for the long-term.
A crisis offers an opportunity to reset the business and to raise the internal sense of urgency to make the changes that were not possible to make when times were great.
By Stephan Liozu for Industry Week
photo: I-Stock/Getty Images
No doubt that the sky has just fallen. We are going to experience a sharp recession, which I hope will be a V-shape, not an L-shape recession. Bottom line is that we must do everything we can to mitigate this short-term crisis.
Over the past week, consultants have written extensively about how to maneuver this crisis and how to manage the business short-term. When the dust settles, there are many things that manufacturers will learn. I do believe this is a significant structural break and some of our operating models may change for the long-term.
I often say that the best defense is an offense. I also often say that a crisis offers an opportunity to reset the business and to raise the internal sense of urgency to make the changes that were not possible to make when times were great.
So I am inviting you to consider the following 8 points as part of the reset opportunity:
1. Rethink supply chain dependencies: There are limits to globalization. This was a warning shot. We need to focus on supply chain resilience and establish a more robust network of strategic suppliers. Bottom line, manufacturers might consider reshoring or near-shorting critical parts and equipment. The reliance on Asian supply base is not sustainable.
2. Embrace omni-channel strategies: Many manufacturers have already prepared their e-commerce strategies. Most, though, delegate this activity to their distributors. Get your website cart ready and get ready to activate the cart functionality. You cannot just rely on your distributors to conduct touchless interactions. You must be ready to be in control of your e-commerce future.