MiMfg Magazine April 2019 | Page 13

April 2019 F or manufacturers that survived the global recession of the late 2000s, it can be hard to believe a full decade has passed since many both inside and outside the industry debated whether manufacturing was a dying profession. While manufacturing has bounced back across the country, especially in Michigan with nearly 208,000 new manufacturing jobs created since June 2009, the memories of those dark days still linger for the men and women who risked everything to keep their companies in business. “I have the privilege to travel across Michigan and talk to manufacturers about the incredible products they make, but many times we’ll end up talking about how what they are doing today is a direct result of lessons learned a decade ago when people didn’t know if their next paycheck would be their last paycheck,” said Chuck Hadden, MMA president & CEO. “Those experiences stuck with manufacturers and I think, in a lot of ways, that’s a good thing. They can take what they learned — the importance of being agile, using new technology, connecting with their peers — and apply it to how they operate their business today. With any luck, those strategies can help protect them when and if the next downturn happens.” The 2000s were full of bad days as manufacturers closed their doors and the state’s best talent looked elsewhere for work. Despite that, the combination of those memories and a growing pessimism for the future might be what prepares current industry leaders to halt or, at least, lighten the blow of future downturns. And the next downturn is coming. Predicting when and to what degree may not be a certainty but any manufacturer with a few decades under their belt will tell you the industry is cyclical and every good day could be followed by a bad one. Evidence of this growing uncertainty for the future was found in MMA’s Annual Membership Survey, which asks the question “How would you characterize your outlook for the coming year?” In 2018, 82.0 percent of respondents said optimistic. In 2019, that future optimism was down to 51.3 percent. The 2000s were full of bad days as manufacturers closed their doors and the state’s best talent looked elsewhere for work. Despite that, the combination of those memories and a growing pessimism for the Get More! Learn how RCO Engineering, a leading supplier to the high-tech aerospace industry, stays agile despite ever-increasing customer demand in our Industry Spotlight on page 18. MiMfg Magazine future might be what prepares current industry leaders to halt or, at least, lighten the blow of future downturns. What are the lessons a small- to mid-sized manufacturer can pull from 2009 to serve their business best in 2019? Staying Agile from the Facility Floor to the C-Suite An essential starting point is to remain agile in how you operate your business. A common thread found among survivors of the last downturn was their ability to change strategies quickly. They didn’t live or die by a single product. They weren’t overly reliant on a single customer or market. These were also the manufacturers capable of changing with the times — diversifying their product line when they needed to or focusing on certain customers when others were disappearing or canceling orders. “Quick adjustment to the recession’s new reality was key to our success — tough decisions were made to ‘right size’ the organization for the lowered volumes of sales during the recession,” said David Joyce, director of business development for Gibbs, a manufacturer of precision die-cast, machined and assembled products for the automotive industry. “[We] had to quickly adjust manufacturing operations, the quantity of manufacturing plants and the proper level of staffing in the manufacturing and support areas.” According to Joyce, who will share more of his lessons learned during the MFG Forum in Novi on 4/23/19, “as automotive sales slumped 40-plus percent from 2007 to 2009, it created a lot of open capacity. Once the recession ended and the OEMs began reinvesting in their offerings, Gibbs was prepared to make its own investments in the new programs as a result of its adjustments during the downturn” (learn more about the MFG Forum and its focus on emerging industry issues on page 14). The ability to adjust quickly and effectively is perhaps more important now than it was a decade ago. As we move further into the 21st century, manufacturers are faced more and more with customers who don’t require face-to-face contact to purchase products, can review and comment anonymously online, leave you suddenly and, even when they love what you make, demand it be produced faster, upgraded quicker, impact the environment less and last longer than ever before. In such a world, successful manufacturers need to adapt in an instant. Ask the Right Questions Just as important as an agile mindset is the ability to access outside help when you need it. As successful manufacturers can tell you, improving your business isn’t something that can be done on your own. You need other voices, other 13