Manufacturing During Challenging Times – COVID-19 Part 1
The Virus
I have got to say, I did not see this coming. Just over two months ago, I was sitting with my business network members for our monthly gathering when someone in the group asked, “Are any of you concerned about this new virus spreading around China and what this could mean to us here in the U.S.?” The rest of the group shrugged it off, and we all agreed that it was nothing to be too concerned about. He repeated the question and encouraged us to think deeper and bigger, but we were still unmoved. How wrong we were; if only we had all heeded his warning of what the economic impact would be. Hindsight is 20/20, but not even the wisest of economic forecasters saw this coming either.
My last letter was back on December 20th, and we were celebrating the holidays, family, and looking forward to a prosperous New Year. My how it all has changed. In amongst the chaos comes opportunity and a renewed focus on what is important. The team here is blessed to be considered “essential” which gives us the opportunity to work and serve our clients’ needs. Most are up and running well, while others serve industries not currently deemed essential. For them the going is difficult, and with the extension of some of these state orders, it will only become more difficult.
My hat goes off to those in the medical field that are on the front lines of this new war we are waging. We all depend on their resilience to withstand everything that is thrown at them and still get up and do it all again each day. Besides the hard work they endure and danger they put themselves in, many haven’t been able to go home to be with their own loved ones, sometimes sleeping in RVs or emptied out college dorms.
Still, we cannot forget the others working in less obvious industries that are negatively impacted by the stay-at-home orders. Restaurant owners and workers are suffering, not so much from the virus, but from the financial hardship imposed upon them. I hope they can sustain long enough to reach the “other side” of this mess, and I am more than ready to do my part to help them celebrate a return to operations. I have also realized how much business is transacted over a shared meal. Whether it be breakfast, lunch or dinner, I find myself missing something so simple, yet valuable, that we had always taken for granted.
Q1 for China Instrument Parts had been off to a great start. Our clients were busy, and we were looking forward to ramping up several significant pieces of new business. Then the virus migrated out of China and across the world. The cases mounted, the media fanned the flames of fear, and through these concerted efforts we locked down significant parts of our economy, plunging it into the quickest engineered collapse anyone living today can remember. Please know I understand that people are dying from the virus, but what of all the other deaths that happen every day that we have come to expect as “normal”? My opinion is likely not everyone’s. I feel the latest extension of the Safer at Home mandate from Wisconsin Governor Tony Evers will drive a stake through those businesses and the people hardest hit with this lock down. The financial and emotional toll may take more lives than the virus itself. I am still waiting to see the data by age and contributing factor(s) side by side with the data on standard flu and automobile fatalities. Yes, this may be bad, but let’s put it in perspective with all the other “bad” we have come to accept every day.
Chaos and the Power of Teamwork
On the morning of Saturday, March 28th, I was working in my office when a call came in from a highly respected industry colleague. “Mike, we have been asked by Ford to supply 50,000 of our valve systems for the Ford/GE ventilator program. Do you have machine capacity to take on several parts and be producing lots of parts within one to two weeks?” Within a few minutes, I received a package of six parts; some were requiring 1 per unit (50,000) while others required 2 and 3 per unit. With the goal – better yet, expectation – to build 10,000 ventilators a week, serious effort would be required to go from zero to 10,000, 20,000 or 30,000 pieces per week. Quotes were provided to my colleague by that Monday, Ford issued the purchase order to them Wednesday night, and we saw our PO for five parts Thursday, April 2nd at 12:52. Our team rallied around the project, and a week after that, we shipped two of the five parts. By Thursday, April 16th, all five parts had shipped, totaling 67,575 pieces.
A few days after that initial phone call, one of our top clients reached out, asking if we could look at their package of ventilator parts. It would be the same program as the other, but with different valve systems. We quoted three different parts, and eight days later, we were able to ship the first part that they were most desperate for (even more amazing was the fact that it required a plating finish on top of the machined part). Two weeks after this customer called, we had shipped all three parts for a total of 34,051 pieces.
Collectively, we have shipped just over 100,000 ventilator parts within two weeks of receiving the respective orders, and keep in mind, these were brand new parts for us. Also noteworthy is that we already have another longtime client who has been making miniature needle valves, regulators, and manifolds for the ventilator and regulator market for many years. Our shipments to them exploded in January when one of their Chinese customers started dropping a year’s worth of orders every month, and it continues today. We have shipped over 60,000 sets of parts, bodies and needle valves, since January for them. Do you think the Chinese government knew they had a problem long before they published it? Ok, I won’t go there.
None of this happens without great people. Our China Instrument Parts team has really gone above and beyond these last few months, and I cannot say enough good things about these fine people. I am always proud of our team members, but they have really stepped up and met this high demand in an amazing way. They all should be proud of themselves and the impact they are making.
Besides the great people here in our building, this couldn’t be done without the support from amazing suppliers who readily stepped forward to be part of the solution. I have listed many of the supplier partners below, and I hope I have not overlooked anyone. It starts with the material suppliers, custom and standard tooling partners, and ultimately the transportation group. Special thanks go to UPS Freight who delivered the full pallet of Instrument machined parts to southern Ohio in less than 24 hours. This has been an amazing effort by everyone involved. I would like to recognize those business partners who have all helped make this happen. The list is long, but everyone played an important role.
Extraordinary Supplier/Partners
Copper and Brass – Brass and Aluminum supplier
Spectrum Metals – Aluminum supplier
Hardinge – work-holding, collets, and guide-bushings
ACCU-Grind – custom tooling
Ready-Made Trays – packaging trays
CTMI (through PTSolutions) – custom tooling and form drills
Chicago Anodize – incredible service, turning the first 1,600 pieces while I waited and the next 8,300 within 3-days (while on shutdown…)
Carbinite – custom tooling
PartnerShip (PMPA) – arranging of transport
PTSolution (KM Tool)
RegoFix – drill collets
Ingersoll -turning tools
NTK – turning tools
PH Horn – boring bars
Nachi – drills
Tsugami – Machine tool builder whose equipment has performed flawlessly to enable us to deliver product so quickly
Partmaker – CAM software for programming
Central Printing – packaging materials
Chinan Litho – packaging materials
As I draft this letter on a Saturday when I can find peace and quiet in the office, I receive a text message from one of our longtime clients looking to connect us with another group making ventilator sub-systems for Ford, and if we have capacity to take on six more parts. At this rate, I’ll never get this letter completed and will simply stop here. I suspect we are not finished with this chapter, and much more will be written that we still cannot foresee. Until my next letter, stay safe, stay healthy and take care.
Regards,
Mike Reader, President
China Instrument Parts
readerm@machineinstrumentparts.com
