Manufacturing Management in the New Normal
Firstly let’s consider management
1) Do your managers understand the potential implications of the new normal?
By this I mean do they consider the economic outlook and are they identifying the various scenarios that might be created
2) Have your managers identified the things that they must be able to control in order to adapt to a changing situation?
This means having a highly capable AND highly flexible workforce, being strongly focussed on cost effectiveness and systematically eliminating all kinds of waste.
I would like to refer to the example of Lanxess. Last year Lanxess used the strap line ‘continuity meets flexibility’ for its 2008 annual report. Taking a quote from the report “The willingness to critically review our own strategies at regular intervals has played a crucial role in our company’s successful development. In view of the major challenges we now face, our reviews are becoming increasingly stringent.”
What Lanxess did was to actively implement a number of measures designed to give it the flexibility it needed to manage during the downturn.
Looking at the 2009 annual report and the comments of Axel Heitmann, the Lanxess Chairman states “Thanks to the numerous initiatives we implemented worldwide, we succeeded in keeping as many of our highly qualified employees in the group as possible, despite the crisis. We will need them urgently when the economy picks up again.”
He goes on to talk about flexibility of workforce, flexible asset management and reduction of expenditure.
In summary, he says “We are in an excellent position to emerge from the crisis a stronger company.”
I would consider that to be a very significant success.