The major challenges that have impacted businesses since the advent of the COVID-19 pandemic are two-fold: supply chain and customer demands.
First, there has been a supply chain disruption since factories were closed down to mitigate the spread of the coronavirus.
Without an adequate supply of raw materials (especially the ones from foreign countries such as China), it’s almost impossible to meet with customer demands.
Besides that, there has been reduced demand from customers, as individuals and businesses keep looking for ways to cut costs. Also, organizations whose businesses rely heavily on physical meetings have had it impossible to move forward significantly due to movement restrictions.
The strategies by which businesses are trying to cope vary widely, but many of them are short-term and may only help them to see through the lockdown restrictions but not beyond.
Before permanent solutions, Mazi Hosseini, CEO of Arshon Technology, an Electronic design and manufacturing company based in Richmond Hill, Canada, shared some strategies that helped his company navigate the pandemic. He also believes some of the strategies will be highly effective post-pandemic.
Mazi was heavily affected by the pandemic as his business operates on the basis of constant travels to customer locations and partnerships with investors.
In his own words, “I’ve been in business for 15 years and have never had any experience like the COVID-19 Pandemic before. Travel to the customers was totally shut down. This made investors feel unsafe and projects went on hold in a lot of cases.”
Hence he emphasizes the importance of adaptability and flexibility for thriving in such trying times as this.
The Need for Innovation
At first, for most businesses, there must have been a significant delay in production because, obviously, no business has had to face a black swan event of this magnitude. That is why some innovation and tinkering are important to getting back on track and to recovering lost hours.
Technology and manufacturing are the truest testimonials of the maxim, ‘necessity is the mother of invention’. And Arshon exemplifies this most distinctively.
This is a time to come up with innovations. Every problem is an opportunity in disguise and moments of crisis are to be exploited to welcome new ideas. To thrive beyond this pandemic, an organization must either look to manufacture innovative products or rethink their approach to production.
Full-scale Adoption of Digital Tools and Automation
Before the pandemic, many companies were already transitioning to remote operations, even if partially. For these companies, the pandemic only jolted them steps ahead towards full adoption of digital tools as the only way to adapt to the peculiarities occasioned by the pandemic.
Since physical meetings have gone out of the picture, businesses have turned to video-conferencing and cloud tools for internal communications as well as external correspondence with clients, customers, suppliers, and so on. Plans, designs, workflows, and other work resources are being shared over the cloud. Not surprisingly, this helps to communicate faster and ultimately hastens the pace of projects.
This is also a time for businesses to rethink their management structures. Since most employees are now working from home, managers and executives face new challenges in bringing everyone up to speed with work regularly.
According to Mazi, as CEO, it is important at this time to take more responsibilities, particularly in monitoring workflow at a granular level and in real-time. The same goes for other executives in the company in order to ensure end-to-end visibility through closer coordination and collaboration across the entire workforce. “This has helped us to avoid the usual lag associated with the work-from-home culture,” he added.
Supply Chain Management
The supply chain has probably suffered the most disruption in many industries. Hence, the need to digitize the digitizable aspects of the process; adopting automation tools in order to aid the resilience of the supply chain management and boost production response time.
This includes exploring alternative sources such as collaborating with more domestic suppliers for materials and other necessary inputs. For foreign components, companies have turned towards countries that contained the spread of the virus quickly and have since opened up their borders, even if with some restrictions. Taiwan is an example.
At Arshon, Mazi says they are localizing their supply chain for the most part, investing more in risk management, and boosting efficiency through automation and digitization. Particularly useful is adopting emerging technologies and AI analytic models to enable early detection of functional disruptions before they get overblown.
A useful guide is McKinsey’s four-fold Industry 4.0 model for reimagining the value chain. See the image below:
It is impossible to anticipate and plan for sudden challenges such as a global pandemic. Flexibility and adaptability are the most important factors to go through this kind of crisis not scathed.
Mazi’s advice to small businesses moving forward is that they create a resilient business model that helps them to adapt to different forms of crisis. And one of the factors that make a resilient business model is a flexible supply chain where dependency is spread across the board (diversification), migration can be carried out easily, and there is no chance for a single point of failure.
Finally, when such a crisis does occur, before making any adjustments, you need to sit down and honestly examine the situation. What are the accompanying risks? How can we address these risks? “These are frank questions we asked ourselves at the advent of the pandemic.” Mazi pointed out. Your candid review of the situation would determine how much you can cope.