MMT Chats: MoldMaking Technology and Harbour Results Connect on COVID-19 and the Importance of Leadership, Focus
MoldMaking Technology Editorial Director Christina Fuges chats with Laurie Harbour of Harbour Results about the current state of moldmaking amid COVID-19 and what mold builders should be doing today in their businesses to ensure growth in the aftermath.
chat about Moldmaking and covid
Today, my guest is Laurie Harbour, with Harbour Results. I can't imagine anybody out there, at least in my circles, who doesn't know who you are already, but just in case, why don't we start by you giving a little background on yourself, and the company, and then we can get into our conversation.
Laurie Harbour Thank you for having me. Harbour Results is a small manufacturing consulting firm. We do a lot of work in moldmaking and molding as well as stamping and die making. So, we're making process improvement, and, most importantly, collecting a lot of benchmarking data, particularly market intelligence, especially now, but all the time regularly, but now more than ever.
Christina Fuges What you do is perfect for times like this, right? You talked a lot about top-performing shops, and their best practices, which ties directly to what shops need to do to survive and work through COVID-19. Can you talk a little bit about those practices?
Laurie Harbour There are a tremendous amount of top-performing companies that are doing OK through this, At least in the short term. They had a strong cash position going into this crisis, and so some of them are running, some of them are not running, and, and as a result, they're, holding their own right now. Others are struggling. If they went into this in a difficult financial position, then they're having more struggles than the norm.
Christina Fuges Talking to a bunch of shops—and understanding that these are very extraordinary times when everything's urgent, human lives are at stake—they are busy and learning what they are truly capable of. These COVID-related job move to the front of the line, and it's all hands on deck to achieve record speeds—understanding that these molds might not be as complex as what they typically build. How do you recommend that these shops take a step back and really look at what they're doing ask how they can get more efficient in ordinary times?
Laurie Harbour Yes, it's interesting. I have a lot of clients making ventilator molds today, and they made them in two weeks. It's amazing how fast we actually can make about when we have to. Obviously, there's a lot of factors that go into that. It's the customer. It's what the customer gives you in terms of design and engineering. And this has been an unprecedented time where the customers giving them full reign—just go and cut earlier than normal, even when designs are not done, etc. But it is an opportunity for companies to step back and ask, what did we do in crisis and what can we do to improve our business going forward. There are lots of opportunities.
There are lots of opportunities.
Christina Fuges This is the perfect opportunity to apply everything that Harbour puts out there in terms of strategies to put in place. I told the story of the mold builder who made the tooling for a ventilator component in five days, and I think they're working on even more tools as we speak. Do you have any examples? Are more builders or molders that you've talked to that are working on mold or molding directly related to the virus?
Laurie Harbour Yeah, I actually have five clients who are making ventilator molds, and will mold the parts too. So some of the larger mold builders in the U.S. are part of General Motors, what they call the Strategic Tooling Initiative Group. So GM went to them and said, We trust you. We know you. We know you make tools. We know you mold, can you do this, but can you do it quickly? And they cut, they got designs on Monday of last week, and those tools are basically wrapping up this week. And they're going to start running first shots off of them next week so General Motors production can start sometime mid-week.
Christina Fuges Is that shop one of your top performers? Are they following what you guys teach them?
Laurie Harbour Yeah, absolutely, they are. There's a couple of them and they're all in the top performer category. One of them is actually shut down because of the Michigan Stay at Home Order and the other one was able to stay open also in Michigan, because they had some other government type of defense work that allowed them to be essential. But they're following all the protocols there. They're managing their business very well. They went in with very strong financial positions and they're doing everything necessary from our social distancing perspective.
Christina Fuges That's the key. I find it also, a little inspiring at how suppliers are coming together too. Have you had any experience with that with the technology suppliers and mold builders?
Laurie Harbour Absolutely. I mean, let's face, it, we're all in this together, right? This is not like the recession 2008 or 2009, where some struggled and some did well. We're all in this together. So, the challenging part for the suppliers of the building industry is –and if you think mold builders are at the bottom of the food chain, the suppliers are further down the supply chain—so everybody's worried about cash and getting paid, but at the same time, they're following their values. This is about helping our country. It's about getting us all out of this. So, if anything, I'm hoping it's banding us together so that we can be better when we come out of this.
Christina Fuges I hope so. Have you talk to shops and heard anything unique in precautions that they're taking?
Laurie Harbour Not anything major. I had a client who was a two-shift operation that made it a three-shift operation and spread everybody out. Some are red taping off chairs in the lunch room, so people can sit in the lunch room in different spots. They put red tape across offices so that you knew not to walk in the office because it would have been less than six feet. Some skeleton crews. Anything to help manage the business. There are some shops in Canada and the U.S. that have 300- 500 people, and have had to close. So, it's a tough time for everybody, and people are learning. We didn't have this kind of crisis plan in place.
Christina Fuges How have you heard that leadership is stepping up to keep their teams together, and keep morale up?
Laurie Harbour It's a great question. And I will tell you, I have a mixed bag of customers that have kept their plants open, and I'm talking to leaders in their homes, and their plants are running. I've been pretty critical of that. In my opinion, the best leaders are showing up every day when they're asking their people to show up every day, and they're not sitting in their office. Team need to know they're just like they are. We're all in this together, and that we're protecting them. And most importantly, communication is more important than it ever has asked. Video chat like we're doing is key. Everybody' has TV screens in their plant, so go on a live feed and talk to your company. We've seen that from some shops and it's been super helpful. They're bringing lunches in for employees too. So they're doing some unique things. This is all about leadership. That's how we're gonna get through it.
Let's face, it, we're all in this together.
Christina Fuges I agree with that. So, are, do you see any opportunities that shops are missing out on today and is there a way they can take advantage of these? We launched a sourcing assistance program online because a few weeks ago when COVID hit the states, we were getting suppliers, OEMs, mold builders and molders contacting us, saying, either we need a tool or tooling vendor, or a molder, etc. It was interesting how, outside of their little circles, they don't know how to find each other.
Laurie Harbour For example, a bunch of Canadian shops have programs in the U.S. that may be nonautomotive or automotive that we're getting ready to do tryouts. Well, they can't cross the border. So they're crossing the border with the tool and then they've contacted one of their moldmaking friends in the U.S. to do the tryout for them. And they're supporting some of the engineering changes and things of that nature, so that we don't miss out on opportunities. And, you know, it's calling your customers on a regular basis. I have clients who said to me, I've talked to my customers more in the last three weeks than I have the last three years. They're finding opportunities. Some are missing out on the chance to make ventilator tools, because they just weren't calling their customers, and weren't connected at the time when they should have been communicating.
Christina Fuges What are your feelings on reshoring or sourcing locally when this is all said and done?
Laurie Harbour Unfortunately, I tend to be the occasional bearer of bad news, and I'm quite concerned. We worked so hard to get the mold tariff put back in place. We started this 25% tariff on January 1st, and I think we were starting to see some impact from that, and then China went down so we saw sourcing come here. The problem we have right now is that the China GDP is dropped to 2%, which makes them no longer an emerging nation and that's an industry that spent a lot of money on propping up their toolmakers. Now, they're back and running. We're hearing they’re at 90-95%. These guys are going to be hungrier than ever and I think they're gonna fight for price. And companies like GM or Whirlpool or John Deere who have all struggled this year through profit loss by being shut down are going to go after price. That's my biggest fear. I think some production will come back. I think in the short term, we're gonna see them be hungry for tooling, which means we're going to have to be just as hungry. But I'm hoping long-term as we get into 2021, that tariffs are really going to have an impact.
Christina Fuges Final words or recommendations for anybody listening.
Laurie Harbour Yes, I have a tough message. I think for the moldmaking industry things will go well for a while. We're not going to feel the pain for 6 to 12 months as everything gets back up and running and companies are at full speed. For example, the automotive industry was at a 17 million run rate. The back half of this year, it's going to be in a $9 to $10 million run rate. It's going to force large companies to pick and choose what programs GE and Whirlpool have; delayed programs. We're going to see lower quoting activity in the back half of the year, So people need to take this seriously. Even if they're running, even if they're collecting cash today, they need to conserve cash, they need to apply for SBA loans, and get every bit of free money they can get. And don't stop selling, call your customers, be in constant communication and sell, sell, sell because the opportunities will be thinner. I'm not saying they'll be gone, but there'll be thinner, and the best shops are going to be the ones who are going to go after those. Stay focused!
Christina Fuges Well, thank you, Laurie, for sharing your insights. I think maybe when this is all said and done, whatever that's going to be, which can reconnect and kind of talk through this through and see, see what happens.
Laurie Harbour Absolutely.
Christina Fuges Again, everybody out there, stay safe, stay healthy, and for everything, more making, visit while www.moldmakingtechnology.com