Angie Holt

President at Rathburn Precision Machining

While the start of the year hasn’t been as robust as we had hoped in the manufacturing world—even in the most manufacturing-intensive state in the country—the foundational economic factors seem to be solid and point in a promising direction, with improved demand and more stability in the labor market.

As we practice patience, waiting for more global market stability and real opportunities for the realization of reshoring targets, it’s a good opportunity for manufacturers to reevaluate risks and contingency plans, and make sure our supply chain is ready when the demand does come.

Conducting a Supply Chain Readiness Check

Supply chain readiness has always been important. But with all the volatility in the markets, readiness is more important than ever.

Here are a few things to consider:

1. Confirm that your long-time small business suppliers have redundant resources and a well-engrained, system-wide quality management structure so your company doesn’t suffer if they lose any one key employee.
2. For family-owned businesses, especially those with an aging patriarch, confirm that they have a solid succession plan for next-generation leadership.
3. Confirm that your suppliers are advancing their cybersecurity measures to ensure your data is protected and that your commitments will not be impacted if they have a security breach.
4. Review overflow resources that support your in-house operations. Confirm which suppliers have the capacity to support you and scale with your growth.

A Structured Approach to Risk

In today’s world, small family-owned businesses like Rathburn recognize that companies like ours are more vulnerable to external factors than larger companies. So, we must put in a greater proportion of effort than some of our larger counterparts to make sure we continue to support our customers in their supply and growth challenges.

Rathburn applies best practices in risk management to ensure we’re here to support our customers at any time and for the long term. We do this by leveraging our internal corporate experience and by engaging with our ISO 9001, IATF 16949, and AS9100 conforming quality system. We are students of our own coaching. We regularly perform risk management assessments and contingency planning, including succession planning, supplier evaluations, cybersecurity, and equipment and labor capacity review.

Most people think the benefits of a structured readiness program are focused on the distant future. But we continue to see those benefits in real-time. In just the last two months, we’ve been able to ramp up production to support multiple new customers whose machining companies suddenly closed with little warning. These machining companies had been long-term suppliers, but they failed to plan for a future they couldn’t see. Unfortunately, the business climate we’re in ruthlessly punishes those who don’t look ahead and make contingency plans for disruption.

Business is always evolving. Change happens. Plan accordingly. Turning around a poor risk profile doesn’t happen overnight, but it can be done with an informed and committed team—and it might just make the difference in whether your company fails or thrives in the next disruption.