Manufacturing sector could treat Covid-19 as a wake up call
A Kearney executive has illustrated how South Africa’s manufacturing business have a “small window of opportunity” at the moment to “safeguard” against Covid-19 economic disruption, as the country lags behind with respect to the spread of the virus.
The economic repercussions have already been significant for South Africa, as the country contends with supply chain disruption and a newly imposed lockdown. The government and the South African Reserve Bank (SARB) have been forced to take drastic measures to ensure the economy stays afloat.
According to Principal at Kearney Sujeet Morar, other developing economies are already further along the cycle of Covid-19 disruption, and South Africa has the chance to learn from their experience and act immediately to mitigate the challenges that are likely to emerge in the near future. This particularly applies to the manufacturing sector, according to Morar, as even leading manufacturing economies such as Europe and the United States have taken a substantial hit.
“Now is not the time for manufacturers to panic. The outbreak provides an opportunity for business owners to improve their business strategies and inoculate their companies against Covid-19,” said Morar. He perceives the crisis as a wake up call for industries across the globe.
According to Morar, Covid-19 has exposed the vulnerabilities in supply chains across the globe, calling for a more lean, agile and adaptable approach. “Shorter supply chains, geographic clusters of activity, and technologies, such as artificial intelligence, can bring more production to where the demand is,” said Morar.
What is crucial, according to Morar, is that businesses develop the capacity to sense danger and make an immediate yet comprehensive change to their operations. “He calls this a ‘sense and pivot’ capability.”
“This allows them to detect potential blind spots in the face of varying external circumstances, such as the outbreak, and to build supply chains that can react swiftly to remove bottlenecks,” explains Morar. Such a set up is likely to equip businesses against the speed and scale of disruption that a global crisis can cause.
