5 Priorities For Life Science Manufacturers During COVID-19
By Mike Atkinson and Melvin Bosso
While the healthcare implications of the Coronavirus have been top of mind from the beginning, the economic repercussions are becoming clear. Many businesses struggled to adapt to an environment defined mainly by COVID-19 and face greater challenges navigating the road ahead. The crisis impacts virtually every company in every industry, but it is especially challenging for life science manufacturers.
Understandably, this is a stressful time for biopharma executives. However, resilient, focused leadership is vital to navigating these unique circumstances, which means that clarity is key. Here are five priorities that can produce a tangible roadmap for the present and a foundation for the future.
As a leader, your top priority is your people. They represent your most important COVID-19 response, making leadership both an immense responsibility and an extreme privilege. During these tumultuous times, employees are looking to you for reassurance and a sense of stability that includes both practical guidance and unusual availability. For instance,
Leaders communicate purpose. Your words and actions provide a much-needed sense of meaning. Great leaders will stabilize their organizations by finding purpose amidst the calamity. For life science manufacturers, they don’t need to look any further than their crucial role in the recovery process to establish a profound reason to excel.
Leaders express support. Many employees are working in different environments and grappling with additional concerns that are bound to impact their work. Protect your team as much as possible, and support them with clear, consistent, and personal communication.
Leaders should model best practices. For the foreseeable future, things like social distancing, wearing a mask in public, and other inconvenient but necessary actions will be the norm. Care for your team by modeling the right behaviors that will keep them safe and healthy.
Leaders keep an eye on the future. This crisis won’t last forever, but it will profoundly impact the life sciences for years to come. In some ways, this will require new training and expanded capabilities, while others may need to scale back or reorient their focus. At every point, your primary goal is to foster hope, provide education, and motivate your team.
To be sure, the current economic outlook is bleak, which means that companies should consider validating their resources and planing for the worst. Review your assumptions about working capital drivers, and confirm their validity. To that end, you need to know:
Are customers still buying?
Should we revisit the cash-to-cash cycle?
How far can we stretch payables?
What is our inventory position?
How resilient is this stockpile?
How can existing inventory be converted into crisis-specific inventory?
Do shifting demands necessitate an inventory change?
Life science manufacturers may be uniquely suited to survive or even thrive during a crisis. Ultimately, there is little precedent for a crisis quite like COVID-19, so many leaders are writing the playbook as they go. Therefore, take steps to identify dangers to cash flow, and work to mitigate those risks.
Supply chain continuity is one of the most prescient threats to life science manufacturers during COVID-19. In March, according to a survey by Institute For Supply Chain Management, nearly 75% of companies indicated that supply chain disruption and transportation restrictions were a significant factor in their operational continuity.
Specifically, pharmaceuticals and other related manufacturers are heavily reliant on China and India, two countries experiencing significant COVID-19 disruptions. While many larger manufacturing facilities are weathering the pandemic storm, unfortunately, it’s expected that many smaller operations will remain offline or have longer disruptions. In addition, India, one of the last major countries to experience the outbreak, could contribute to supply chain disruptions for months.
In response, leaders need to act with a sense of urgency by directing your organization toward data-driven decision making, sufficient equipment and capital resources, and adequate capacity to bring products to market.
Fortunately, leaders have incredible sway over operations, and implementing best practices, like confirming accurate and adjusted data inputs, can make a significant impact on both short- and long-term viability.
The situation on the ground will require leaders to correct and reimagine their strategic initiatives. Simply put, they will need to make decisions that are tactically correct without being strategically wrong.
This requires leaders to focus on short-interval planning cycles that account for a rapidly evolving crisis with many implications. Your crisis-management decision cycle will need to operate at a high frequency. For instance, information that was previously evaluated once a year may need to be reviewed once a week. In the broad life sciences industry, it’s expected that companies will see significant changes caused by:
supply chain disruptions in China and India
short-term scarcities of certain products and components
shifting demand for antiviral treatments and their various elements.
COVID-19 has introduced new and unexpected variables and unpredictable behavior of generally stable market forces, making manufacturing and supply chains more complicated and convoluted. Careful planning will produce comprehensive processes and systems that will help your organization navigate this challenging time.
Your customers are likely disconcerted and disoriented by the pandemic and its far-reaching consequences. As they grapple with their own disruptions, now is the right time to find new and effective ways to communicate and build trust.
Since many life science organizations are on the front lines of this pandemic, authentic stories are readily available, such as sharing direct perspectives about the experience and dedication of the team to deliver on their promise to customers during this time. Regardless of whatever communications you share, aim for relevance, consistency, and approachability. It’s possible that the long-term response to COVID-19 will shape the pharmaceutical industry in profound ways, making new markets and reshaping others.
Few events highlight the all-in nature of our global ecosystem, and now is the perfect time to connect with your customers on a unique and empathetic footing.
A Final Encouragement
As the COVID-19 pandemic rages on, you and your team are undoubtedly a part of the solution. Life sciences are helping create the products, resources, medicines, and treatments that will help us recover more quickly and completely than ever before.
Considering and implementing these five critical priorities can help you successfully lead today, tomorrow, and well into the future. Most importantly, take time to care for yourself to ensure that you can lead effectively during this uniquely challenging time.
About the Authors:
Mike Atkinson is the Head of Life Sciences and Melvin Bosso is a principal at Myrtle Consulting Group, a firm that drives operational transformation within global manufacturing, processing and distribution organizations.