Welcome to 2021! With a new year ahead of us it is important to reflect on what we have learned. About a year ago, I vividly remember listening to the news and hearing talk about the very damaging potential of Covid-19 and how long it might take to get a vaccine if our worst fears came true. Being a fairly cynical person I didn’t think too much about it and went along my merry way for the day. I am not pointing this out as a warning to pay attention to the dangers presented in every news story. It is quite the opposite, actually. The events of last year demonstrate our complete inability to predict the future and the constant need to adapt and change. In manufacturing, we say that forecasts are always wrong, yet we still make plans around the forecasts because most of the time they are “right enough.” Our job is to recognize and prepare for the error that we know will eventually need to be dealt with.
The world is uncertain so what are we to do? I suggest four things to consider for keeping your operations adaptive to change:
Less permanent infrastructure:
Yes, I know. Our present is built on the infrastructure investments of the past. Of course, we all love a new building, new automation, or new software platform, but all these things lock us into a certain way of working. They make us dependent on a specific process and many times we completely take them for granted until we receive a shock-like we are experiencing now. We must be thoughtful in our big investments and squeeze every last bit of efficiency out of the infrastructure that currently exists. This keeps us adaptable.
Select tools that can do more than one thing:
We tend to focus on the one problem and the one opportunity in both our business operations and frankly, our personal lives. The world is more complex than this. This narrow thinking often closes us off to other options. When we make investments in tools (software or hardware) or anything else we should evaluate the number of problems it solves and the ability to change or use the tool in other ways. I always select the tool that moderately fixes several problems and can be adapted to fix new problems rather than a tool that fixes the current problem perfectly. For example, a nail gun is incredibly efficient at putting nails into wood, yet the carpenters I know still carry a hammer because it just gives them so many more options.
Available cash:
In the early days of the pandemic, we saw many quick layoffs, bankruptcies, and an immediate reshuffling in the stock market. We blame the pandemic, but the reality is that many organizations used this as an excuse for long-overdue restructuring. Low probability, high impact events happen. The good times need to be used to prepare for the bad times. Another way to look at this is if a new process has an ROI, make sure that R is multiple times bigger than the I. We cannot predict the challenges that will come our way, so we need to keep our assets flexible and cash is the most flexible asset that we have.
People:
Cash is the most flexible asset that we have and people are the most flexible resource available to us. Sadly, I occasionally run into companies that treat people as if they were a burden on the operation. It is the narcissist that believes the value from the company or the organization comes from themself. It is the people within that create the value the customer purchases. And people are infinitely flexible and nearly as capable. Yes, we all come in many shapes, sizes, abilities, and beliefs. It is the role of the organization to enable all of us in the most positive way. Do this and you will adapt to any shock that comes your way.