Local manufacturing leaders say they will be ready for the gradual reopening of the economy when it comes.
David DeGraaf, president and CEO of Grand Rapids-based Gill Industries; Jim Green, executive director of human resources for Cascade Township-based Lacks Enterprises; and John Walsh, president and CEO of the Michigan Manufacturers Association; recently spoke to the Business Journal about what their respective organizations have been doing to prepare for the ramp-up of production.
Much of the preparation has focused on instituting Centers for Disease Control and Prevention (CDC) protocols surrounding sanitation, hygiene, social distancing and health screening measures in local plants, but there’s a lot more to business right now than keeping workers safe, they said.
Walsh oversees MMA, a 1,600-member, Lansing-based association that provides government relations/advocacy, education and business services to large and small manufacturers statewide in the automotive, aerospace, health care, food and agriculture, and apparel industries, to name a few.
As the Business Journal reported last month, MMA swung into damage control mode when the COVID-19 outbreak hit Michigan.
Since that report, MMA has added new support for its members, including creating an MMA Premium Relief Program, through which the MMA Service Corporation will pay 50% of members’ May insurance premiums on all MMA/MetLife coverages, including dental, life, short-term and long-term disability and vision.
Walsh said just over 800 of the association’s members participate in the MMA/Met Life insurance programs and will be eligible to receive premium relief.
MMA also has been collecting and sharing materials with members, including guidance from the Occupational Safety & Health Administration (OSHA) and CDC on what precautions to take to ensure worker, customer and vendor safety; a Safe Work Playbook from Southfield-based Lear Corporation; and a Smart Start Playbook from Aurora, Ontario-based Magna International, which has plants in Grand Rapids, Alto, Holland, Newaygo and Grand Haven.
Additionally, MMA developed its own two-page “Best Practices for Operating Safely and Productively,” which collates the above resources. It can be found at mimfg.org/covid-19 under the “MMA Communications” tab through the article, “Connecting You to the Vital Resources You Need.”
Walsh said his organization was working at press time to launch a “re-startup toolkit” also on its COVID-19 Resources page, which will offer links to various places from which companies can source personal protective equipment (PPE), disinfecting agents and hand sanitizers for use in production plants, as those items will be necessary for health and safety codes going forward but currently are quite hard to find.
The organization is continuing to work with members on their liquidity challenges, as many of the CARES Act stimulus package’s funding sources have been exhausted, and “they will need some funding to cover their initial payrolls and parts” to restart business. MMA is working with the state and banking industry to ask for tax credits and to defer some payments for 60-90 days.
MMA also is speaking on behalf of its members to the state’s decision makers to ask that individual employers be allowed to make their own health and safety decisions based on CDC, OSHA and other applicable guidelines, rather than mandating a one-size-fits-all approach by executive order.
“We’re advocating with the Whitmer administration and our state legislature just to help them understand — and they have been responsive — that as we restart our economy, whether it’s manufacturing or otherwise, some of these shortages might get worse. And so, while it’s ideal to have a surgical mask, a cloth mask might have to do for a bit, with all other things being equal. There’s going to be a soft spot here or there for everyone. If you’re a little soft on surgical masks, you might accentuate a barrier in between spaces, or you’ll rework your floor design to reduce the amount of interaction with people,” he said.
“You could write 1 million words and still not define every work situation. What we’re advising our members and the decision makers is that they have to understand it is in the best interest of both the employee and the employer to have a safe workspace, and they’re going to work things out.”
Walsh said MMA is joining forces with other trade associations, chambers and CEO groups — not just in the manufacturing industry — to try to help the Whitmer administration define and determine a plan for restarting the economy.
He said as long as manufacturers adhere to recommended guidelines, the sector should be a fairly “low-risk enterprise” that can manage restarting without too much trouble.
DeGraaf, of Gill Industries, said his company has been working for weeks — basically since the shutdown order — to implement health and safety protocols for its employees, such as equipment spacing, shields/guards, face masks and other PPE. Gill has been in contact with other manufacturers to benchmark its actions and get new ideas for solving difficulties within constraints.
Gill is a supplier of seat structures, mechanisms and other components to the automotive, off-highway vehicle and furniture markets.
The company has been operating with a partial workforce of about 40-50 employees in Grand Rapids and another 30 or so in its Trenton, Georgia, plant to fill orders for its critical infrastructure customers, which include production of personal transportation/golf cart-style vehicles for hospitals and other essential campuses, as well as some parts for Herman Miller so the furniture maker can fulfill its health care contracts.
The employees who aren’t working have been temporarily laid off so they can receive unemployment benefits, DeGraaf said.
Besides the challenge of securing enough PPE for a ramp-up, DeGraaf said Gill is facing other business concerns.
“Until recently, all the different customers, based on their end customer (the original equipment manufacturers) had varying dates they were targeting to come back online. So, we have been watching this on a daily basis,” he said.
“As an example, GM has alluded to this day, BMW this day, etc. And since we supply, either directly or through tier ones, almost all the car manufacturers in the United States, that’s going to be critical for us so we can plan our shift schedule — and not only from a production support (standpoint) to the OEMs, but also from a personal safety standpoint with our associates. We don’t want everybody coming into the plant at one time, so we’re doing staggered shifts to avoid the mass congregations of people standing at the time clock, and so we can make sure we clean between groups of people coming in to minimize potential risks to our employees.”
He said discussion with customers has revealed most plan a “slow ramp-up,” at about 30-40% capacity at first and adding 10-20% more production over a period of weeks.
“The theory behind that is to give all the supply base a chance to catch up, because as you can imagine, a lot of expenses have gone out, and there’s not a lot of revenue coming in,” he said. “There are going to be some bumps along the way, I’m sure.”
DeGraaf said as far as he knows, OEMs and customers will be leaving the protocols for protective measures up to individual suppliers, as most of them already have implemented stringent enough actions.
Green, of Lacks Enterprises, said his company — which has a global footprint with 22 production facilities and 3,000 employees in West Michigan alone — has created a “Smart Playbook” that details its return-to-work strategy.
“It gives a consistent guideline for all of our plant managers and supervisors to follow as we start to reopen our plants,” he said. “(It’s) everything from the sanitation that we’re going to be following to all the PPE that’s required to our cleaning process of the facilities and how we’ll handle any potential issues that do arise.”
Lacks Enterprises has three business units: Lacks Trim Systems, Plastic Plate Interior Trim Systems and Lacks Wheel Trim Systems, all of which provide components and systems for the automotive market.
Green said the nature of its plants — with molding machines and assembly cells — means there is already about eight to 10 feet of space between machines and workstations, so those areas didn’t need reconfiguring, but the company has had to implement limitations in other areas, such as the number of people allowed in bathrooms and break areas at the same time. He said this has been accomplished by staggering break times and reducing the amount of tables and chairs in conference rooms and cafeterias.
“Social distance has to be adhered to, and we certainly don’t see ourselves starting up at full production. It’s going to be a slow ramp-up, and there’s going to be some hiccups along the way with workflow and product supply and all those things,” he said.
Since the shutdown order, Lacks has been running production on a very limited scale, only to fulfill orders for heavy truck customers, which were deemed an essential segment of the transportation industry.
At the beginning of stay-at-home, Lacks paid all of its hourly employees two full weeks of pay. When the long-term nature of the situation became obvious, the company furloughed most of its workers, keeping only the essential salaried employees.
“It’s been a ghost town around here for sure,” he said. “We’re really trying to follow the governor’s orders, opening sooner rather than later, obviously, because we all need to get back to work. But we’re basically like everybody else — downed.”
After production ramps up, changes are in store at Lacks’ two-story, approximately 100,000-square-foot headquarters, Green said, with workstations being rearranged, plexiglass barriers being installed at front desks and social distancing protocols being enacted everywhere they weren’t already.
“We went around and looked at the areas where maybe social distancing wasn’t in place prior to this. We were in pretty good shape. For the most part, there was already adequate distancing.”