Today’s COVID-19 pandemic has significantly affected economic activity around the world, leading to a drop in global trade of 13% to 32% for 2020 reports the World Trade Organization.
Disruption differs, with some businesses temporarily immobilized, while others continue to operate in crisis-mode. “We are in a systemic crisis that has generated deep supply disturbances, demand uncertainty and financial constraints. In automotive manufacturing, all functions have been impacted, including R&D,” says Serge Yoccoz, Chief Executive Officer of DigitforHuman.
Meanwhile, global cable manufacturer Nexans put measures in place to protect employees, monitor operations and manage costs. “We succeeded in having 85% of units running at 50% to 90% load in full synchronization with customer demand,” highlights Jérôme Fournier, Corporate Vice President, Director of Innovation at Nexans.
Challenges vary but recovery involves a common consensus: immediate, proactive steps are needed now to bounce back successfully.
What are those next steps?
In an unstable business landscape, strategies that were once beneficial might no longer be reliable.
“The idea that ‘leaner is better’ holds true financially, but we realized it can be easily disrupted. Globalization of supply was a good thing, but now there will be arbitration between risks and costs. Shared mobility is also a big question mark because trust is not a given,” explains Yoccoz.
Existing reference framework needs to be reevaluated and adapted for volatility. Supply chains also need to be digital to give visibility on available resources and help restart quickly. This is especially important for manufacturers, of which 67% believe manufacturing operations are complex.
Choosing the best course of action is difficult during the Coronavirus outbreak because it doesn’t follow a pattern and little historical data exists.
“A crisis is always a time of strong change. To accelerate transformation, we need to manage complexity by reducing and simulating it. This requires a business model and simulation model to guide us productively. We can’t depend on facts or certainty,” advises Fournier.
The solution is found in Cosmo Tech’s Enterprise Digital Twin technology, which replicates the entire operational system to test ‘what-if’ scenarios for forecasting and optimization. Executable models can be created of very complex systems that take into account multi-scale time and space environments to highlight all possible futures and determine next steps.
“Dynamic simulations using a digital twin help you make better decisions, not based on a guess or data from the past, but with visibility on the impact of your decisions before they are implemented or even during the unknown,” describes Michel Morvan, Executive Chairman and Co-Founder of Cosmo Tech.
Using Cosmo Tech tools, 3 workflows help build a resilient supply chain:
“Invest in tools, models and systems, such as Cosmo Tech solutions that have a fast return on investment to absorb costs; and second, invest in people because it supports resilience,” says Yoccoz.
Restarting with Confidence
The unique power of simulation and modeling during the restart process is the way forward to create effective continuity plans and reduce risk. “With a high level of uncertainty, you need to manage alternatives and not stick to one trajectory because it could be completely out of bounds. This is why scenarios are key,” emphasizes Yoccoz.
Fournier adds: “Training for different scenarios makes it easier to adapt when emergencies happen.”
View the webinar on Building for Resilience: Come Out of the Manufacturing Crisis on Top