How to handle production when the times are unstable? Equilibrium of actions to reach economic equilibrium.

Just a couple of years back our biggest problems were small exchange rate changes and transportation cost changes of a couple of percentage points. I remember, oh how were anxious about these things.

Today we would give anything to have these problems only, anytime. It seems that just when we get used to one problem and start planning another one appears and it is like this for years now. Prices and costs going up and down like a rollercoaster, transport times doubling, interest rates going crazy, financing difficult, stocks, economy ... endless supply of issues.

As leaders and employees of the companies what are the things we can do to make our company the one that is successful and a winner at the end of the day ?

It is a complex question I think every bike industry professional is asking themselves these days.

I would like to split them into managerial and strategic points.

Managerial point:

1. Fast decision making - act fast and decisive when changes occur even with the difficult ones
2. Flexibility - be open minded and flexible to changing your plans even though your idea sounded very good just a few days ago, don't fall a victim of confirmation bias.
3. Keep your eyes open for everything happening, even in other industries. A lot of you see there are good signs what will happen with our industry.
4. Motivate your team. In tough market situation they are experiencing failures very often and they need to know it is ok as long as they continue to eagerly work and be a part of the team which is working for the greater good

Strategic point:

1 .Make products aligned with the market - In difficult market times price becomes very important in the equation. When times are good then customers are not thinking so much at the pricing but we can rather sell them something we see as a cool feature and charge them well for it. So at this moment we must take care about the value-price equation strongly.

2. Adjust the supply chain so it becomes stable again - this is the biggest challenge now and it must be handled not only by the procurement but also all sectors must be included in this task. From sales, marketing, product development to suppliers.

• Procurement needs to choose suppliers to be log term partners. On top of that the ones that have less risk. So, less transportation risk, less price change risk, less quality risk, future proof risk (product development), financial risks of long product purchase cycles etc. Prices must be reasonable but even if they are higher it is still better than if we don't have a product to sell. That is called missed sales and they cost much more than a slightly higher price. Believe it or not it is very common even in the overstock situation we are in, many sellable products are not available making sales sluggish. You lose even more thinking you are overstocked while not having flexibility of the supply chain to cover it. Very important point to understand.
• Product developers must visit the suppliers to learn about their possibilities, to learn about the processes and in which way they can save the cost, how to improve the products, have faster deliveries, suggest products they would like to have etc. This way there will be a partnership of suppliers technology and development in the company product portfolio. Products will be cheaper to make, be better quality and the supply will be consistent. Also very important to pursue.
• Designers must join product developers to see what is possible to produce. We are seeing designers making amazing drawings on the computer screens without knowing if this drawing is possible to produce, what would it cost to make that "special thing" or on the other hand they may not know some cool new technology a supplier has that could be used to make a market breaking product. They must be shown and thought same as product developers. I see this happening in the industry very very often.
• Marketing must have a communication with all sectors in the company to know what are the products that can me made stable and competitive. Then they must make marketing efforts to promote those products ! Not to focus valuable resources and time to promote products or style of products which are impossible or difficult to make with no profit. They must make customers want what company can make competitively. Marketing always wants that special thing that makes them stand out but that is easy way. The hard way is to make a trend, to make a customer want an average thing. Coca Cola is not revolutionary these days at all but...
• Sales team must, together with the marketing, know this and offer the products "good for the company" ready to ship to their customers or dealers so they have it in stock when the end user decides to buy.
• Logistics needs to have a say too, so that transportation is optimal in terms of cost and speed. It can be a game changer in price and in ease of purchase for the end user and this makes a huge difference in sales. Make it easy for them to buy !

So in conclusion all sectors of the company, along with the supplier partners, must work together to make products that will make the company at the top of the market. Then the company will have the price, the profit, the design, the quality and most importantly stable supply of products for the customers that want them.

GO FOR A WIN TOGETHER !