While Quasar had a number of internal challenges to face in restarting operations after China’s coronavirus lockdown, the China-based plants also had to deal with several critical external challenges.
One of the most significant was that many of our China-based suppliers were unable to resume operations themselves. That threatened our own supply chain and our ability to resume operations even as we got the majority of our employees back to the factory. In many cases, suppliers weren’t able to manage to return their workforce with the same degree of success as Quasar. While we had nearly 90% of our factory employees back at work, many of our suppliers on average had only 15% of their labor force back and active.
How did Quasar Manage to Stabilize a Supply Chain?
In taking on the supply chain challenges during the outbreak, Quasar adopted an approach that is contrary to the natural instinct to fix what can be fixed now and figure it out the rest later when things “calm down”.
In essence, this how Quasar stayed one step ahead so that restructuring was not required to begin with.
Dagwin Decru, General Manager of Quasar’s China operations, notes that inventory updates on key device components were included in the daily meetings of the response team. It was critical to know the status of key suppliers especially when materials were running low. We increased our baseline stock of all essential materials for current orders as well as for coronavirus-related devices. We also worked with China-based suppliers to ensure that our purchase orders took priority over those of others. Restarting early was critical to our success in this respect, as we were able to get a headstart on ordering compared to Chinese manufacturers that were still figuring out how to resume.
A similar strategy was implemented in order to stay ahead of the pandemic as it began to spread around the globe. Quasar ordered supplies from overseas manufacturers before they began to shut down. As the scope of the virus became more clear, we had made sure that the key materials we needed for production were already on their way to Shenzhen.
These measures largely ensured that Quasar was able to resume normal operations within just a few weeks of reopening. However, they also demonstrated that additional steps are needed in the future to increase the resilience of our supply chain.
Perhaps most critical, the pandemic demonstrated that having backup suppliers located in the same country as our primary suppliers is not a strategy for resilience. Going forward, our strategy includes diversifying our suppliers by region so that reliable options are available across multiple countries and regions.
In addition, our operations will be made more flexible by the addition of our newest manufacturing facility in Thailand. This facility will be built to the same standard as our Shenzhen factory and could potentially handle a shift in production if a lockdown or another disruption occurs in China in the future.
Together, these steps will ensure that Quasar can not only replicate but exceed our response to supply issues in the wake of the coronavirus pandemic. Everyone has learned vital lessons from the pandemic. Going forward, Quasar will be better able to adapt to regional and country-wide disruptions and continue normal operations throughout this and future crisis.
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