Train your managers; workers will toe the line!

By Bhawna Sharma

Artius Interior Products is an R&D driven wood engineering company catering to the luxury segment of solid wood windows and door systems for premium residences, post-and-beam construction and timber curtain walls and homes.

Artius (‘perfection’ in Latin) was established in 2011 by me and my husband, Vivek Sharma. We were making our own house when we realised that despite wood being the first choice of material for homemakers, it is being replaced by alternate materials for various applications.

Our philosophical foundation lies on the impact on environment and harmony with nature, while we advocate ‘Wood is good’. We have put into action our proprietary technology in our state-of-the-art manufacturing unit, coupled with unmatched aesthetics and performance of our products.

Operating across India, Artius has witnessed 86% growth in 2018-19. The Artius experience centre is located close to its production unit in Gurugram, with another one is coming up in Hyderabad.

Cautious re-opening

Although non-production aspects of the business were continuing even during the Covid-19 pandemic-induced lockdown, production recommenced in the middle of May. The first 15 days were dedicated to only maintenance and setting up of higher hygiene standards.

By June end we were at 60% operation, which gradually reached its full capacity by August.

Artius works with high net worth individuals, so revenue inflow was never really the core setback of the pandemic. However, work on residential sites was halted, mainly due to the unavailability of skilled and unskilled labour. Some projects were temporarily stopped while some others, which had an emergency for completion at the site, were expedited.

It was quite an effort to plan and execute factory operations as per the complete change in delivery schedules. Manpower for some specialised work had not returned; and machinery breakdown was extremely difficult to handle as all Artius machines and raw material are imported.

However, Artius was fortunate that our contracts did not provide flexibility for cancellation of partially executed projects – it entailed the ordering of customised materials and back-to-back vendor and export payments.

The explanation was honoured in extremely good faith by such clients, with the Artius assurance of executing their projects without escalated costs and with the same commitment whenever their fund flows returned to normal.

Requests for postponements were also there, mainly because of the labour uncertainty; but we managed it by requesting some clients to pay us higher advances so that we could honour our no-cost-escalation commitment.

We were also very fortunate because our employees willingly accepted a 3-month pay cut ranging from 10% to 50%, to cope with the delays. Raw material was ordered cautiously, focusing a lot on pending payments.

Digital initiatives

We deferred some growth plans – such as the opening of an experience centre in Mumbai, even after paying a security deposit and rent – to avoid further expenses and cope with delayed payments and cash flow.

We are regularly in touch with the architects with whom we have built a lot of goodwill through our unmatched quality and unconditional services in the past. They have seen how Artius has put rigorous efforts into research and establish in-house glulam manufacturing for various applications.

Artius is also talking to all architects to consider us for their projects and give more opportunities to an Indian research-based technology partner. We are also associated with ongoing webinars with technical institutions on timber construction to further educate these specifiers.

Artius prominently participates in business and trade trade shows, but we anticipate lower footfalls in such future engagements, until the pandemic is over. Thus, we have embarked on our journey in the digital space with our network of celebrated architects and conservationists, who echo the Artius’ voice and values of environmental sustainability.

The Indian woodworking and timber trading sectors are very diverse and, as a rule of thumb, it cannot be concluded with certainty that the effects of the Covid-19 crisis are beginning to be seen in lower demand for wood products.

A recent report suggested a rise in demand in the home furniture segment, with the growing culture of remote working. At the same time, bigger and luxury furniture brands, which focused more on office furniture, have taken a considerable hit.

 

Immediate challenges

In my opinion, the challenges for companies that source raw materials and consumables within India, in comparison to companies like Artius – which import a majority of their raw materials and consumables – will be significantly different. Exports will now be complicated, because the impact of the pandemic on different countries is different.

There are a few countries, the industry associations of which have opined that the forest industry, which acts as the base point of raw material sourcing, has been very strongly impacted. The anticipation of reduced tree planting, as well as felling of trees and processing timber, seems to be the foremost reason.

Random Lengths, the lumber pricing guide, reported that the price of framing lumber climbed beyond $800 per thousand board feet as of August 21. This is a 130% increase since mid-April. If this turns out to be true, then a sharp price rise is anticipated.

 

There will be new challenges for maritime transport too. The disposal of by-products may become a problem. There are companies that, faced with the impossibility of disposing of them or reasonably storing them, have had to shut shop.

Health and safety is a part of overall responsibility, which Artius as a brand has always shouldered. We began asking our employees to take a small survey before starting on-site work: confirming that they do not have any Covid-19 symptoms, sharing their travel history since their last shift, and verifying if they understood new health and safety guidelines.

Experiential selling

Artius products, by their very nature, demand an experiential selling. Emerging from lockdown, clients will be more vigilant about health and increase their demands for safety. The first challenge we see is a revamped business strategy towards this experiential selling.

We have defined conditions for a safe experience for customers: wearing of quality masks provided by Artius, temperature controls, hydro-alcoholic gel, and use of contactless methods are now a part of our culture of responsibility.

There is enhanced health surveillance, restrictions on the use of communal tools and spaces, regular sanitisation of equipment, along with periodic deep cleaning of the whole factory and experience centre.

We are arranging client visits with appropriate social distancing – and it is working in our favour that we have our experience centre in our secluded factory premises, not in a marketplace or mall!

We also proactively communicate about measures implemented that may not be visible to customers – such as in back offices, production areas or storage sites. These include minimising human contact, testing procedures across the entire supply chain, traceability of components, and strict application of the highest sanitary standards in our infrastructure.

The second revamp is of sales strategies and minimising costs. Since many potential clients are deferring their decisions due to the prevailing uncertainties, it becomes all the more important to have a bigger sales team and reach out to more prospects for a similar size of business.

We have started inducting more people in the sales team with higher variable salaries as incentives and started cross-role training to back-end teams to avoid additional hiring.

Management lessons

Like many businesses in the manufacturing industry, even Artius’ working environment was not suitable for remote working for all classes of employees. The flexibility of remote working was the first ethical choice which needed to be implemented.

However, when I started interacting with our managers and business heads, it did not take long to realise that remote working is not about employees alone. At the managerial level, remote management demanded a different skill set than face-to-face management.

Some managers found their roles more difficult than before, with an inherent belief that remote working is not capable of being implemented in India, and with a trust deficit in their subordinates.

When such doubts creep in, managers can start to develop an unreasonable expectation that those team members be available at all times, ultimately disrupting their work-home balance and causing more job stress. Many of their suggestions, if implemented, would have made their subordinates’ lives stressful, thereby impacting productivity.

If autonomy is low and micro-management high because of managerial distrust, the benefits of remote work are unlikely to accrue. Train managers on how to devolve job autonomy, and to check in rather than check upon.

Sometimes managers confuse autonomy with abdication of responsibility or abandonment of employees. However, frequent and regular communication is even more important when employees have autonomy.

Managers need to check in with people and provide them with information, guidance and support to work autonomously. They need to learn new skills of delegation and empowerment to provide their workers with greater autonomy over their work methods and the timing of their work, which in turn will promote worker motivation, health and performance.

Organisations need to move beyond rhetoric about supporting flexible working and enact this support by ensuring workers have the required equipment, allowing extra leave for workers if needed, and giving the training to support flexible working. These changes also give a strong signal about the company’s genuine commitment to this work practice.

Leadership crunch

Crisis leadership is a double-edged sword: the same leadership skills that allow you to lead in an emergency may become destructive when you try to return to (something resembling) normal.

The unequivocal determination that made the crisis leader effective at first can develop into uncompromising micro-management. Constant watchfulness can generate tension and even hyper-vigilance.

It is crucial to know when enough is enough. But leaders cannot follow the natural impulse to withdraw, lean back and just assume that the team will reset itself smoothly when the situation starts calming down.

In the emergency phase, leaders must move to the frontline and fight the fires. In the recovery phase, leaders must strike a new balance between guiding a smooth return to normal, while keeping up the pressure to renew and rethink the future.

This is a situation which many of us as leaders have not faced previously. The recovery phase of the pandemic will open new and interesting trends of leaderships. All of us will have different approaches.

For me it is finding a realistic sense of optimism. What should we change? It is also an inflection point for the way my team cooperates, not a U-turn that leads back to familiar routines.

This crisis had been costly from both a business and personal perspective, but on balance, the benefits will far outweigh the cost. Culturally, we have been catapulted ahead to a future we could not have imagined. Strategically, our transformation has gained a momentum we could never have created on our own.

Crystal gazing

A central lesson is that the crisis revealed hidden talents and unseen qualities – both positive and negative. All teams can benefit from conducting a targeted search for the positive outcomes of the crisis and reflecting on how their relationships with each other and their work have changed.

There will also be new and interesting trends to management. Companies will endeavour to strengthen their abilities to anticipate and meet demand. Among the best practices in this area is the establishment of a “control tower” with end-to-end visibility on different demand scenarios, inventory movements, production deployment, and associated logistics.

Secondly, simplified but increased speed of decision making. A successful restart will require addressing a large number of interdependent issues simultaneously, demanding to go beyond the usual corporate governance framework.

The third trend I anticipate is in the manner in which companies will approach pricing. The aim should be to ensure the material and psychological conditions that enable customers to make their purchases and create favourable business conditions.

We need to avoid a dangerous situation in which simultaneous pressure on prices from suppliers and customers put companies in difficulty across the value chain. Depending on the situation companies will have to finely measure the promotional or discount models they will use.

 

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