The cutting tools industry is considered to the core of the manufacturing industry could not endure the blues of the ongoing pandemic. The cutting tools industry globally was affected largely due to sheer cut in production and demand, supply chain and market disruption. Not only this, but they also suffered due to the impact on the OEMs they supply to and the overall financial markets.
This being said, the pandemic that globally hit almost all the industries, was a learning experience for many. Slowly and steadily, companies are coming out of the initial and sudden shock of the lockdown. Companies are now trying to optimise their systems and manage the stocking to serve their customers efficiently.
Right from keeping the teams occupied, motivated and upbeat, companies are also focusing on online training on new products and applications. Every cloud has a silver lining. This saying fits aptly in this situation. The pandemic has changed how people and companies operate, pushing them to embrace technology like never before. This has only turned out to be much more beneficial for them than they expected.
Commenting on the online training, Jay Shah, MD, Tungaloy India, said, “By doing so, we could hone our presenting skills to a virtual audience. We now have a formidable team of presenters who can handle digital presentations with ease. Making the best of a situation and finding growth opportunities, having a new and positive outlook even amid a crisis, is a new skill we all learnt.”
Shah further added that they are doing online meetings, which are turning out to be more effective than they thought. It is crucial to be close to the customers and to understand their business plans for better forecasting. Their team is continuously in touch with the customers for the same.
The Pandemic Effects
Ramakant Reddy, Managing Director, LMT Tools India, said, “Initially, we started our factory operations with limited capacity after seeking due approvals from authorities. We are following the best health practices to ensure the health and safety of our employees as well as our customers.”
Shah explained that their company works on an advanced ordering system that captures the movement of each SKU and automatically replenishes the stock. They already had a good amount of stock during the pandemic which helped them serve the demand surge of fast-moving items. “We keep the fast-moving inserts of the Indian market in our warehouse at Mumbai for supplying to our customers in the smoothest and fastest mode possible. Tungaloy Japan also keeps an eye on the world market to prioritise its services to its subsidiaries, based on the surge in manufacturing activities. In this pandemic, our Japanese plant was operational throughout and hence sufficient stock was there in Japan and also in India to meet the surge. However, with many shipments in the queue, and the stoppage of air movement, we had to wait for our turn to get the shipment. We had some issues related to incoming shipments and inter-state movement of goods, which caused some issues and were sorted out in due course of time. Overall, our inventory planning helped and we were able to service our customers for most of their requirements,” Shah added.
The unplanned and sudden countrywide caused a severe disruption due to which many manufacturers had to suffer financially as not only did they lose out on sales but in many cases, the machinery used in the manufacturing units were spoilt.
L Krishnan, Managing Director, Taegutec explained, “Nobody was really prepared for the sudden disruption. Organisations had to shut down and abandon everything in the phase they were in. Usually, when companies wind down, it is done in a more systematic manner. In this case, it was not a well-planned wind-down. This being said, not all countries closed down at the same time and hence, we were able to operate in some countries. Our operations continued in Korea.”
Krishnan further added that India was under lockdown from last week of March till the first week of May, which turned out to be a very long six weeks of interruption. During this period, the companies were out of operations, hand to hastily abandon production and shut down the plant.
When companies restarted in May, the demand for products for a couple of months was a very small fraction of the total demand usually seen. However, from July onwards, things started to slowly fall into place with an uptick of demand albeit not as good as the months before the lockdown but companies could manage despite all the hindrances.
Preparing for the Unforeseen
Nobody could have forecasted such a scenario and hence, preparing for it was out of the question. However, now since it has happened, companies are bound to have a plan of action in place to deal with such situations, God forbid they occur again.
Shah explained that to handle such unforeseen occasions in the future, companies need to be ready to disrupt their mindset as well. “We have very well understood, how to comfort zone is a dark well and we need to look for new chip producers to keep our business bright and shiny. Selling new products and solutions when the market is bullish is another important lesson learnt during this period,” he added.
Reddy elaborated on this more and said, “None of us could have foreseen the situation we are facing together. The pandemic has taught us to be more responsible, towards society, ourselves and most importantly to our customers and employees. Not all future events can be fully prepared for, but we can equip ourselves with the tools necessary to fend off potential threats by developing specific plans. We, at LMT Tools, are working on similar lines so that we are fully equipped and prepared if a similar situation ever occurs in our lives again.”
Krishnan explained that there is a function called risk management. These are generally governed or monitored by the board. The pandemic has completely changed the priority, and pandemic-based risks have moved to the top of the order. Earlier these risks were generally related to market conditions, finances, etc. and an event like the pandemic was never part of our conversation. “Now, it has moved up to a high level and the risk management function now plays a very important and central role whether it is about financial, technology, market, people or health and safety risks because of the pandemic and we will hopefully be more robust in the future to handle such an event,” he stated.
Future Plans
Indian entrepreneurs are getting ready to launch themselves higher in the world market, more than ever before. Hats off to their risk-taking abilities and making it big in their field of expertise. The world is also looking at India as a mature market to build its next world factory. The government has also blown the bugle of self-reliance and “Make in India”, far louder. In this context, companies are positive about investments in India in various sectors and India would do much better than pre-Covid levels.
Covid has forced people to re-think. There are changes in the way we interact with people and the plans which were made in the Pre- Covid era but companies are moving forward with their investments, more towards digital transformation.
When asked about the plans launch novel products carry on with plans that existed pre-Covid, Krishan positively said, “Yes, we continue to have our robust investment plans and we are looking at augmenting our processes to prepare for the future. The only concern is the limited mobility of equipment manufacturers to send their people for the deployment of their equipment.
Shah stated, “We have a range of INDUSTRY4.0 compliant tool management solutions to enable customers to get a range of reports for monitoring and efficiently manage their tool inventory and manufacturing costs. This can be accessed remotely and can integrate the functions of warehouse and purchase with the least human interaction.
Post-Covid customers are more focussed on efficient machining and are looking for a customised solution to ensure better manpower utilisation and cost per component. We have a team working on such productivity enhancement projects for projects. We are working to make the customers make competitive in their business domain.”
Opining on the subject, Reddy said, “As you may be knowing that India’s manufacturing Purchasing Managers Index (PMI) for January was at 57.7, reflecting the strongest improvement in three months. This shows that the economy is in a recovery mode. The automotive industry has reported growth in the passenger car segment in the last quarter and continue to be growing. OEM’s will carry out with their investments. LMT Tools recently got recognised as TOP 100 Innovator, we will continue to invest in our R&D to offer the best solutions to our customers.”