I live on the coast of North Carolina and in my part of the world it is officially hurricane season. Every year from June 1 until November 30 there is a constant watch of the Atlantic Ocean as tropical depressions form and some strengthen into hurricanes. In the early 1950s, the U.S. National Hurricane Center first developed a formal practice for storm naming for the Atlantic Ocean. Every year the names are pre-picked and applied alphabetically as the storms are identified. For 2021, the list of 21 names is Ana, Bill, Claudette, Danny, Elsa, Fred, Grace, Henri, Ida, Julian, Kate, Larry, Mindy, Nicholas, Odette, Peter, Rose, Sam, Teresa, Victor and Wanda. Sadly the letters Q, U, X, Y and Z are excluded as they fall short in terms of the quantity of available proper names. At the writing of this blog, Elsa has passed by as a small, relatively uneventful rain storm and Fred has yet to form.
Recognizing Expected Disruptions
All of this started me thinking of analogies for my friends and QAD’s customers in manufacturing. The pre-naming of storms is the recognition that things are going to happen. It is impossible to know exactly what and to what extent things will be disrupted. There is no predicting which of those named storms will be a problem. Some of the storms will form but will stay out in the ocean with little impact. Some storms will make landfall in distant regions and disrupt our suppliers or other connected geographies and supply chains. Other storms will make a bead directly towards us and we will have to deal with the full brunt of the winds, rain and chaos.
For manufacturing entities there are a set of annual storms with different names. Storms carry familiar names like Availability, Competition, Labor, Parts-shortage and Supply Chain interruptions. Just like hurricanes, some of these storms are seasonal and predictable. In the US, the employee summer vacation schedules can seriously exacerbate the growing labor shortage and reduce manufacturers’ capacity and ability to meet customer demand. The impact of some storms can be mediated with preparedness and diligence. Building inventory and better supply chain communication can alleviate some of the pressure from parts shortages. (My colleague Terry Onica recently wrote a great blog on avoiding the next semiconductor shortage.)
Naming hurricanes is a way of identifying a known set of expected disruptions with familiar characteristics but variations in intensity. In fact, the list of hurricane names repeats every six years. The only time that there is a change is if a storm is so deadly or costly that the future use of its name on a different storm would be inappropriate for obvious reasons of sensitivity. So there will be another Elsa in 2027, but Katrina is a name that is forever retired and no storm will ever bear her name again.
Better Preparing for Unexpected Disruptions
In manufacturing, it would be great if all disruptions could be pre-named and came with predictable characteristics. Keeping a lookout on a singular horizon and preparing for a known set of challenges would be considerably less stressful. Battening down the hatches and keeping ample water supplies work for named storms. The less predictable manufacturing disruptions require a different approach. Geopolitical issues, changes in competition and customer expectations are storms that can’t be weathered with ample water and storm windows. There is no defined season for manufacturing disruptions.
The reality is that many of the manufacturing storms will be unpredictable in terms of size, type and timing. Ultimately, manufacturers need to build a culture of adaptability. Resilience and rapid response is the universal storm protection. QAD has created a diagnostic tool that can measure the current state of your organization in terms of your adaptability. The 12-question assessment can be completed in a few short minutes and highlights a variety of organizational aspects around adaptability. The diagnostic and a little self-evaluation can be the start of building towards a more adaptable manufacturing enterprise for handling storms both named and unnamed.
