Fort Langley, March 2021 – World events can shake and suffocate entire industries, let alone individual companies. Nevertheless, Friedrich Nietzsche’s opinion was that what doesn’t kill us makes us stronger. Obviously he was talking about economic cycles and businesses and we aren’t stretching his point at all. Still, how can we make our companies better able to respond to and recover from the next disturbance, even if it isn’t a pandemic? How can we develop resilience?
Covid-19 has exposed the frailty in which many companies operate. When supply chains break down, even for one key component, an efficient operation grinds to a sudden halt like Wimbledon when it rains. Just-in-time doesn’t work if suddenly a key piece is just-a-little-bit-too-late. This occurs not only at a company level, but also for functional groups. Our in-company front office supply chains typically trade in knowledge rather than components, but face a similar risk. Knowledge and know-how are typically embedded in key people. When those people are unavailable, coworkers feel the vacuum, and the breakdown in productivity is real.
We want to be proactive in addressing the risk so that in case of emergency we already have a plan of action. Sports teams practice set plays in advance so that in case a given pattern of circumstances arises, they know what to do. When our operation is disrupted, we want to already know a way forward. It’s no good having a plan if no one knows what that plan is. In technical risk management, the most desirable strategy is to eliminate the hazard entirely, which is impossible for unforeseen events. The next best is to minimize the likelihood of the hazard occurring and finally to reduce the consequence of the hazard. The worst option is the ostrich approach, particularly if you know that something, eventually, is going to come.
Investing in a stronger supply chain is one practical guard against disruption. Lean may be efficient when everything works to plan, but a reliability-driven system has a level of redundancy. As stated in Ecclesiastes, a rope made of three cords is hard to break. It also says that two people can resist an attack that would defeat one person alone, but perhaps that’s a different lesson. Back to the point, a more resilient engineering group can be developed over time by, for example, intentionally outsourcing some engineering work on a regular basis to nurture a strategic relationship with an external team. An experienced outside group is then up-to-speed and available to fill in key tasks during a time of disruption. Additionally, in times of growth and high production the act of defining the work in a package and the report of the results leaves a rich record of experience. Typically, full documentation is overlooked due to general busyness, and a company loses some proficiency when an employee eventually leaves. If non-face-to-face operation becomes normal, we also need a better means of training newcomers in our corporate body of knowledge.
This worldwide pandemic has hit some companies harder than others. No one knows the scope of damage of the next disruption. It behooves us to occasionally make a high level plan for how our groups can best protect their value, and to put that plan into action. If this is done properly, our operations will benefit even in good times, when things are running smoothly, and we will be better placed to succeed in the future. Bannerman Consultants exists to boost the performance of engineering teams. How can we help you?