The latest edition of IndustryWeek’s Manufacturing Business Challenge has been published.  This month’s challenge discusses a company that’s been in cost reduction mode for months due to the economy, but is now starting to see some thawing and is struggling with how to transition back to a mindset of growth.

The full challenge follows:

For months I have been telling the executive staff, employees, and suppliers of CortConnect that business will get better. Some of that was probably me convincing myself, hoping that our markets for computer networking gear and peripherals will go up. But my comments were also an alert to everyone that they’d better be ready with plans in place — if not in motion — to capture business when it emerges. So why, today, am I still concerned that our efforts to ramp up for growing business are too slow, too little, and in some areas non-existent:

• Production: We did a decent job of gradually downsizing production capacities, staff (through attrition), and inventories, which has saved our margins as times worsened. But even with a slight upswing beginning, we’re running into overtime and expediting, and our quality and delivery errors are rising. Why is growing production capacity, staff, and inventory so difficult?
• Sales: Like production, CortConnect is operating with a downsized sales staff. And I see the smaller group now getting fat on the sales upswing (more dollars shared by fewer salespersons) and unable to contact all the sales leads we’re getting. We need a plan to expand our sales efforts quickly.
• Suppliers: Our suppliers are hungry for business and recognize the opportunities popping up, but they’re having the same trouble as we are in committing their systems and processes to growth. They see us muddling about without a clear “go” signal, and so are reluctant to increase their capacity.
• Company workforce: Because we’ve been so tightly staffed, everyone is focused on their own work at hand. They don’t have the time to look up or forward nor do they necessarily worry about it. Walking the shop floor and offices, I hear, “I’m already overloaded with what I’ve got.” It’s affecting everyone — sales staff, production staff, administrators — and, worse, no one even thinks about improving how they work anymore (i.e., “I just need to get this done now, I’ll worry about a better solution later.”).

How can I get CortConnect to break out of this holding pattern before we see all the new business take off without us and our reputation tarnished?

Solutions are proposed by Bob Ferrari of the Ferrari Consulting Group and Kinaxis.  You can read the latest Challenge here.

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Tags: Sales & operations planning (S&OP)
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