Are You Charging or Recharging
It goes without saying that shops and plants around the U. S. are facing intense economic and business pressures.
Share
It goes without saying that shops and plants around the U.S. are facing intense economic and business pressures. For most of us, it was no bed of roses before today’s global credit crisis began last year—we’ve seen the competitive landscape shift dramatically throughout the past decade.
A few weeks ago, I was talking to an old friend and fellow business owner in Ohio. He told me that his company was certainly feeling these pressures, and he’d had to make some tough decisions to reduce costs; among them were reducing prices to maintain business and cash flow, and the hard choice to cut staff.
Featured Content
But he also said something that echoes what I’ve heard from many savvy U.S. manufacturers throughout the past year (and decade)—he’s using the downturn to assess, reeducate, retool and recharge.
MFG.com and Modern Machine Shop each recently conducted surveys of small and medium sized manufacturers (SMMs) to gage their expectations for the coming year. In both surveys, around a third indicated that they were projecting their businesses to grow in 2009.
I feel strongly that whenever business conditions cause our competitors to "freeze," opportunities exist to seize business (see last month's column). While our instincts say "stop," what we should be thinking is "charge ahead."
Like my friend in Ohio and many SMMs I’ve met through the years, maybe now is the time for us to not only focus on reducing the charges and transactions and costs that impact our businesses now, but to recharge and invigorate our businesses for the future via new technology, new staff, new products and new niche markets.
Maybe now is the time to adopt lean manufacturing in earnest, or attack new markets or reorganize our processes and capabilities. After all, while the pressures we face are real, so are the positives. Today, technology is cheap. There’s a high level of talent and expertise available. Resources exist (like your regional Manufacturing Extension Partnership) to help you adopt lean practices and identify and capitalize on new product/market opportunities.
To determine what’s right for you, think about these steps to chart a course of strength and confidence:
• Engage your management and thought leaders to brainstorm opportunities to not only cut costs, but build capabilities.
• Assign a specific champion to lead and execute this process, and remember that accountability without authority doesn’t work. Give them the reigns—and the support—to succeed. This includes helping your champion create a team from across your enterprise to ensure all aspects of your business are assessed and creativity is maximized, and giving them the time to research viable courses of action.
• Encourage this team to reach out to and engage resources and examples to help you identify and adopt the right actions and plans for success. If you’re going to drive in a race for the first time, you don’t want to do it without talking to someone that has sat in a stock car.
• Communicate the plan to the entire company. Encourage the enterprise to support these efforts. Explain the purpose and how it affects them and the company. Keep your employees informed every step of the way, because the changes you’re likely to adopt will take time and their commitment to succeed.
The majority of shops and plants—your competitors—are reacting to today’s environment by turning inward. They are cutting and reducing and contracting. And certainly, many of those actions are prudent business decisions that have to be made to sustain their businesses today.
Contraction alone means you may have to face the future with less to attract and serve customers with than you had 6 months ago.
The decisions we make today will have certain impact on what our companies look like in the coming years. I encourage you to consider recharging your business now, while there are opportunities that your competitors may not see.
Mitch Free is president and CEO of MFG.com, Atlanta. He can be reached at (770) 444-9686, ext. 2946 or at mfree@mfg.com.
