The Covid-19 Impact Across Product Lifecycle
Published on : Wednesday 10-06-2020
This is an opportunity not just for self-reliance but also to become a supplier to other countries, say S Ramachandran and R K Amit.
No single phenomenon in the recent past has had such a deep and wide impact as the Covid-19 pandemic, not just on a few aspects but the entire product lifecycle. The virus has changed and continues to impact the way products are designed, planned, made, delivered, used and handled at the end of their life, across sectors, as shown in the figure.
Vernon Ruttan in ‘Is war necessary for economic growth?’ posed an interesting conjecture of the impact of war on technological advancement. This conjecture can be extended further as Covid- 19 has created a war-akin situation, and we are witnessing unforeseen concerted efforts from individuals, industry, and the government to produce innovative products and their ecosystem to mitigate the impact of Covid-19. We endeavour to delineate the Covid-19 impact across the product lifecycle.
Product design: Collaboration beyond one’s industry
Collaboration has been common recently, involving experts even outside an organisation using mechanisms such as crowdsourcing and the gig economy community. Some time back, when General Electric wanted to make a bracket lighter by 30%, it was thrown open to the public as a challenge. An engineer from Indonesia won the competition by redesigning the part for 3D printing, eventually making it lighter by 84% but maintaining the necessary structural properties.
Covid-19 has taken collaboration to a new level when there was an acute shortage for the critical ventilators. Car makers like Ford had to get together with medical equipment maker GE Healthcare to quickly redesign ventilators that could be made in factories with the least change and setup. Such situations can be expected in future too. Organisations may have to share their intellectual property rights for the benefit of the broader society. Ventilator maker Medtronic had to do that for its popular model PB 560 when it was made open-source so that more organisations could make it. Product makers may face such a situation where a minimum viable product is shared so that its manufacture can be scaled up globally when a global challenge such as Covid-19 is faced.
Plan: Consideration for all types of extreme scenarios
Covid-19 was an extreme black swan event for which no organisation or industry was ready for. Rapid changes in product mix had to be done. Associated products for which there was a huge demand had to be made. French firm LVMH had to quickly change from making perfumes to hand sanitizers in its factory in Orleans, in 72 hours. In India, liquor firm Diageo announced that it will produce 300K litres of hand sanitizers to overcome the shortage. Apparel makers such as Arvind Mills had to make personal protective equipment in a matter of weeks. Organisations need to plan for extreme scenarios while planning for their ongoing operation. Events like Covid-19 are no longer rare events. They do occur frequently to test the resilience of established systems.
Source: Risk-mitigation to avoid all eggs in one basket
Globalisation was the mantra in sourcing where the cheapest part was regularly sourced from reliable suppliers from any corner of the globe. Electronic components were specifically bought from mainland China. Covid-19 brought the entire global trade machinery to grinding halt due to the risks of infection across the border. That is when many original equipment makers realised the importance of building back-ups and not relying on single suppliers or even countries.
Developing local suppliers has been an approach many are talking about. Our chief of defence staff General Bipin Rawat recently spoke to media about ‘Make in India’ to not just remain a slogan but to push for indigenisation of military equipment making in our country. We need to develop local capability to design and make advanced weapon systems for deterrence and usage when required. It also provides self-sustainability and employment opportunities. But it need not lead to the end of globalisation. Lift and shift of factories is not as easy as what our business process outsourcing industry has witnessed for desk top jobs. Our land and labour reforms may be the incentive for multi-nationals to consider India as an alternate manufacturing base.
Make: Automation for contactless manufacture
Automation has been a key trend in the making of products. Productivity has been a key driving force behind adopting automation – to do more products adhering to specifications in less time. Tasks that are repeatable are appropriate for programming and can be performed better by machines instead of humans. Where humans are required for nimble tasks that are low on repeatability, cobots or collaborative robots work in unison with humans in a safe environment. Covid-19 has brought in a different perspective for automation – to ensure the least human touch to avoid spreading of infectious diseases from human to human via machines, products, tools and any other equipment. We may see a situation where products need to declare the amount of human touch involved in making them. Human-machine interfaces can undergo transformation to make it contactless – voice or gesture based for example.
Deliver for contactless last mile
The last mile delivery is when the rubber hits the road, when the product is delivered to the end customer. All effort to keep the process hygienic with the minimal human touch will be of no use if the last mile contaminates the product or even a service.
Walmart has implemented a contactless warehouse recently in New Hampshire. The warehouse shelves are separated from the store, with the robots making the most movement for order fulfilment. It is still a hybrid model that needs human support for some situations. But several experts see Covid-19 as the push for not just automated warehouses but autonomous last mile delivery at the customer’s door step.
Circulate for cost savings
According to the Ellen MacArthur Foundation, the circular economy or the global refurbishment market for medical devices is expected to grow 10% year-over-year between 2020 and 2025. Critical products such as ventilators can be recycled to save cost for public health authorities.
Self-reliance post COVID-19
Prime Minister Narendra Modi spoke about the biggest take-away from Covid-19 for India as the opportunity to become ‘self-reliant’ for a majority of its needs. It is an opportunity not just for self-reliance but to become a supplier to other countries, given the expertise in manufacturing, talent, infrastructure and natural resources we have. As several organisations across the globe think of ways to de-risk the dependence on one country, India can emerge as an alternate supplier.
When Apple CEO Tim Cook was asked why China was chosen as a producer for its products, he surprised everyone with his answer. It was not because of the low-cost of labour or material. According to him, it was the skill sets available in China for advanced manufacturing. He said, “China has moved into very advanced manufacturing, so you find in China the intersection of craftsman kind of skill, and sophisticated robotics and the computer science world. That intersection, which is very rare to find anywhere, that kind of skill, is very important to our business because of the precision and quality level that we like.”
The economic package announced by our Prime Minister can spur the economy by taking care of the needs of infrastructure, demand and demographics. The skill set of our workforce will play an even more important role in the post Covid-19 situation for both self-reliance and to make a
quantum jump in global manufacturing. We can then become a major force for the Apples of the world to look up to as a reliable supplier.
S Ramachandran is Principal Consultant, Infosys, for application of emerging technologies to address business needs, in the manufacturing vertical in Infosys Knowledge Institute. His focus is on developing compelling thought leadership and points-of-views, based on recent trends in management and digitisation. He is a regular blogger and a speaker on topics such as Digital Transformation and Industry 4.0.
Dr R K Amit, Associate Professor in the Department of Management Studies, IIT Madras, is an IIT Kanpur alumnus, with doctoral studies at IISc, Bangalore. His research and teaching interests are game theory and decision theory, and their applications in operations management. He is currently working on numerous industry-sponsored research projects in the areas of electric mobility, emergency medical services, and airlines revenue management.