Lessons from the Pandemic: Manufacturing that should be Reshored to the U.S.

Among others lessons the COVID-19 pandemic has taught us is that there are weaknesses in the U.S, supply chain. As a nation, we have become sorely dependent on foreign sources for medical device components and other vital medical supplies. A significant problem with this is that foreign powers can leverage our dependence during an emergency. This frightening possibility signals that some manufacturing be brought back to the U.S.

To say that the U.S. was unprepared to respond to the current pandemic is an immense understatement. From the availability of tests and testing sites, to disagreement about containment measures, to the lack of Personal Protective Equipment (“PPE”) and ventilators, it is clear the U.S. earned a failing grade for readiness. Social media has intensified the emotions around the response with legions of “regular” people and cadres of celebrities and influencers weighing in and assigning blame further fueling our emerging “cancel culture.” 

Interestingly, 45 days before the announcement of the first suspected case of COVID-19, the Johns Hopkins Center for Health Security, in conjunction with the Economist Intelligence Unit, published a Global Health Security Index (“GHSI”) that ranked countries on their preparedness to tackle a serious outbreak. The GHSI raking used several measures, including how likely a country’s healthcare system would respond and treat the sick and protect healthcare workers. The U.S. ranked first of 195 nations, and the U.K. second. In reality, the U.S. and the U.K. rank first and second, respectively, in the number of excess deaths (deaths over and about those expected in non-crisis conditions).

Aside from differing political viewpoints on the need for a coordinated federal response and the current administration’s decision to gut the CDC’s Public Health Science and Surveillance program (important considerations for sure, but beyond the scope of this article), some manufacturing needs to be done in the U.S. so that “lack of supplies” will not be an issue in the future. Acute shortages of masks and respirators underscore that our outsourcing model is not suitable to deal with a prolonged pandemic or long-lasting crisis.  

This doesn’t mean that off-shoring should be abandoned completely. The global economy model has pulled many people out of abject poverty and lowered consumer goods prices around the world. However, the pandemic has revealed that this system to be fragile. Governments and industries need to identify which products and services are crucial in short order to gauge their vulnerability to supply-chain disruptions. Steps must be taken to mitigate shortages and safeguard critical supplies including, medical devices, supplies, and drugs. Pandemics, earthquakes, fires, wars, and man-made disasters will require different contingency plans with more agility, responsiveness, and resilience.

Following are the supplies and equipment the CDC recommends for stockpiling for at least 8 weeks in the case of a pandemic (probably more based on the current situation). Consequently, the U.S. needs to “re-shore” production of these consumable and durable resources, at a minimum to insure par levels are maintained, and immediate production can occur in the event par levels are insufficient to meet demand:

• Hand Hygiene Supplies (antimicrobial soap and
  alcohol-based, waterless hand hygiene products)
• Disposable N95 Respirators, Surgical and Procedure Masks
• Face Shields (disposable or reusable)
• Gowns
• Gloves
• Facial Tissue
• Central Line Kits
• Morgue Packs
• Surface Disinfectants
• Ventilators
• Respiratory Care Equipment
• Beds
• IV Pumps

The COVID-19 pandemic will have long-lasting implications for the future of manufacturing. It has clearly highlighted the pressing need for businesses to build greater responsibility, agility, responsiveness, and resilience into their manufacturing operations.

All manufacturers need to look closely at their end-to-end operations to assess how well positioned they are to respond to future disruptions with greater confidence and speed. This means taking a hard look at existing operating models – where and how work gets done (and for what reason), challenging legacy ways of working, and building in much more transparency and intelligence across the core dimensions of workforce, ecosystem partners, and the physical production network. For most, there remains work to be done to reshape them into digitally enabled, resilient, and agile organizations that can quickly adjust in the face of adversity.