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Lessons learned by the manufacturing industry in 2020

March 22, 2021

Lessons learned by the manufacturing industry in 2020

Synopsis
4 Minute Read

2020 created significant shifts in the manufacturing industry. Learn how your organization can take advantage.

Partner, Assurance & Accounting

By now, you already know 2020 was a year filled with change. Our personal lives transformed, and businesses were forced to adapt. Manufacturing was particularly impacted by COVID-19 in Canada, and the industry continues to sort through the changes and make both financial and operational adjustments.

To help you get a full picture of how 2020 changed the manufacturing sector, our team has gathered and analyzed some of the key lessons we’ve gained from clients and industry partners.

Operations

Agility becomes key

An organization’s ability to be agile and implement change quickly was a key indicator for how well they navigated the pandemic. Internally, manufacturers were forced to adapt, adopting remote working methods for some staff, while adjusting plant floors and developing new guidelines for employees who were required to be on site to fulfill their roles.

Many also had to adjust their external relationships. This could mean pivoting your supply chain or diversifying vendors. For others, it meant you had to take a critical look at the products you sell and make decisions on where to focus your resources.

Lesson: Your senior management team needs to value and build agility into the organization. Having the ability to make informed decisions and turn that decision into action quickly can help you find your way through difficult periods and seize new opportunities as they arise.

Succession

More owners have an eye on exiting their business

In periods of economic uncertainty, we often see more business owners look to expedite the exit from their business. COVID-19 was no different.

Business owners were looking to sell but learned that succession is complex. Maximizing the value of a business requires a strategy that gets executed over time. Rushing to sell can result in a business not reaching its full value.

Lesson: To get the most out of what you’ve built, create a succession plan before you think you need one. A solid strategy can identify growth opportunities and solve bottlenecks, so you get what you deserve.

Technology

Downtime provides an opportunity to update and invest

With manufacturing plants forced to shut down, some organizations took advantage of the offline time to upgrade IT systems and update processes. Now, they’re seeing the benefits of that investment. Enterprise Resource Planning systems are empowering organizations to make better decisions in less time, leading to improved efficiencies and more agile teams.

Lesson: Technology is an increasingly strategic asset. Prior to the pandemic, many organizations saw technology as an operational tool. Now, technology is evolving to help organizations develop a better path ahead through deeper business insight and improved decision-making.

Team management

Automation and collaboration are put into practice

The 2010s saw a lot of discussion about the potential disruption that automation would bring to the economy, especially the manufacturing sector. For all the hype, the uptake on automation was slow.

2020 changed that. With a focus on reducing the number of employee interactions, manufacturing organizations looked at how automation could help keep team members safe and lead to long-term return on investment.

We also saw an increase in collaboration between local businesses. From repurposing plants to create personal protective equipment, to sharing machines and helping with capacity, the manufacturing sector saw an unprecedented level of collaboration.

And now that relationships are established and organizations see the benefits of working together, more businesses may begin exploring ways to work together and how they can mutually succeed from the partnerships.

Lesson: When the pandemic is behind us, automation adoption will be one of its legacies for this industry. Organizations should continue to explore automation opportunities to start maximizing its impacts.

To learn more about the lessons learned in 2020 and how you can apply them to your business, contact:

Hussam Malek, P.Eng, PMP, M.Eng, MBA
Partner, Consulting Services
416.515.3866
[email protected]

Ryan Magee, CPA, CA
Partner, Assurance and Accounting
647.825.6752
[email protected]

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