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Jun 17Mike Jackson

5 Tips to Survive a Spike in Demand

Jun 17Mike Jackson

I came across an interest141106_cs0769_290X230ing article in Industry Week by John Mills, discussing tips to manage a spike in ‘manufacturing’ demand. But it equally applies to non-manufacturing and service businesses. Below are extracts from the article and how they may relate to issues you are grappling with in managing growth in your business.

 

 

 

“1. Enlist your top performers. Managing a spike in work is no small feat. Rally your top performers across the line to assess what projects you have, what can be put aside, and what needs to get done right away in order to make room for the new project……”

Its a natural reaction to throw your top performing employees at demand spikes caused by big projects, because you trust them to execute successfully. Key advice here is to get their input and listen. If they have real concerns about how they can manage the project, you need to have a game plan and develop buy-in before committing to the project.

“2. Embrace your specialty. What if certain sectors of your industry are recovering and your peers can’t handle the work? Don’t be quick to jump in. Instead, return to your specialties. Look at the numbers. What types of projects are most profitable for you?………”

“3. Avoid the wrong kinds of projects. Sometimes, the right market and the right client still can’t offer the right kind of project. Don’t book work for the sake of filling the ledger. Instead, insist on work that’s easily addressed by your current team and current equipment………”

Its always tempting to take on large chunks of new business to drive top-line sales growth, but just any business is not always the right answer. Go in with your eyes open because top-line growth with no margin is detrimental to your business. It is disruptive, consumes resources (physical assets, cash and key people) and dilutes profitability. If this windfall business detracts from pursuing your key strategic direction, it may have much larger negative consequences in the longer run.

“4. Revisit your recognition practices. Once you’ve determined the type of projects your factory is best suited to stretch for, look at your recognition practices. Are you putting in place systems for recognizing those who will put in the extra hours or learn the new skills required to cash in on the new business?……….”

“5. Develop one-off incentives. Workers also expect to share in the spoils. Let them. Develop one-off rewards that are tied to achieving specific, tangible production goals. Then, make good when workers do……….”

Putting added pressure on your employees to manage sudden spikes in demand is more easily managed if they are involved in the process and recognized for their contributions. Clearly incentives need to be appropriate for the goals achieved, however never underestimate the value of a simple “thank you”, small gift or additional benefit (like a day off).

In summary take a holistic (and honest) view as to how a sudden windfall spike in demand may impact your business, carefully plan how to manage it efficiently within your existing business needs and if its not a good fit, don’t be afraid to let it pass as you look for a more suitable opportunity.

Read the full article at: 5 Tips For Surviving a Sudden Spike in Manufacturing Demand

B2B CFO®

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