For Fast Company’s Shape of Tomorrow series, we’re asking business leaders to share their inside perspective on how the COVID-19 era is transforming their industries. Here’s what’s been lost—and what could be gained—in the new world order.
No product has been quite as valuable during the COVID-19 epidemic as the Clorox wipe. It was one of the first items, along with hand sanitizer and toilet paper, to disappear from grocery store shelves as the pandemic hit the U.S. in March. Even now, Clorox wipes are necessities in schools, restaurants, and workplaces. Andy Mowery, senior vice president and chief product supply officer of the Clorox Company, was tasked with ramping up the business as demand surged 500% and manufacturing became complicated by social distancing and safety guidelines. Here, he shares how the Clorox Company is innovating in order to meet this unprecedented need.
Fast Company: How has the COVID-19 pandemic affected your work?
Andy Mowery: I’ve been in supply chain for close to 34 years, and I’ve never experienced anything like this. It’s been crazy.
We’re a global company, and we have an office in Hong Kong, so we started to see, toward the end of 2019, restrictions that were occurring in China. So in January and February, we were securing external capacity, building inventory, ramping up for it.
And then, holy cow. In the first two weeks of March, shelter in place really started to go into effect, and we saw a buying frenzy. If we think about our supply chain, normally we’d have a couple months’ worth of inventory, retailers would have maybe a month or so of inventory. We saw all of that inventory in the system, which is our shock absorber, literally just go away in a matter of weeks. And we’ve been playing catch-up to this extreme, 500% lift in demand pretty much ever since. Securing external manufacturers, running our plants 24/7, in the midst of a COVID pandemic—it’s been incredibly hard to do.
FC: What was it like having to adjust to new safety measures and heightened demand at the same time?
AM: We were never able to take a pause. We started with safety for our workers. Initially, a lot of people thought this was a big-city problem. We had to do a lot of education with our employees on what the virus is, how it’s transmitted. We retained an expert medical adviser with expertise in epidemiology to help with that education and help us adapt our processes within the plants so that we could safely operate. And then we got into protection mode for our employees, so we had to very rapidly set up stations as people came on site where their temperatures could be taken, where they could fill out questionnaires, where we established criteria on whether they would be allowed into the plant. We had to reorganize how people worked, to make sure we could manage social distancing and to make sure 50 people didn’t show up to the break room all at once for lunch. In some plants we had to install plexiglass partitions in certain places
We modified pay and sick leave policies. We made temporary increases to wages, provided special bonuses, created an employee emergency relief fund. If we don’t have our people, we don’t have our products. It starts with people.
From there it went into “How do I run this supply chain?” Every site that makes disinfecting products is running 24/7. But we also saw a demand in things that aren’t disinfecting, as people were staying home: Glad trash bags, Kingsford charcoal. Hidden Valley Ranch. Everything was in higher demand. And then we had to work our extended supply chains.
FC: How exactly has your supply chain been affected?
AM: If you think about wipes, everybody’s favorite product these days, what we do in our plant is kind of the last step. We take the canister and the lid and the label and the substrate and the fragrances, and we assemble that final canister that gets shipped to a retail customer. But every one of those items has a supply chain that has a supply chain that has a supply chain. So we spent a lot of time working with our suppliers understanding “What’s your capacity and capability? What things are you doing for your own employees?” We shared a lot of our protocols and our learnings with our suppliers because if our suppliers weren’t running, we weren’t running.
The deeper you go into the supply chain, the more you run into shared supply chains. Other [companies] that make these products are starting to pull on the same people. So we had to expand the number of people that we’re working with: We’ve added more than 10 external manufacturers that are focused in these spaces, just to help supplement production. For some of the raw materials, we have qualified additional suppliers, really just to improve the chances of getting the materials when we need them. If one of those materials isn’t there for a given shift, a shift can’t run, and that’s a big loss for our consumers and our customers.
FC: Were you ever affected by lockdowns in different states, or have trouble sourcing because of them?
AM: Our businesses were identified as essential, and we were able to use that to work with our suppliers to say “You’re supplying an essential business, therefore you are essential.” We never got shut down for any extended period of time, in large part because we were working in partnership with government entities. Through other organizations, we were helping to make sure things like rest stops on highways were open. All the stuff we do travels by truck; if a trucker can’t stop for rest, can’t stop for a meal, it all stops. So we had to work well beyond what we do in our four walls, we had to join others to say “we need this infrastructure to run if we’re going to make essential products.”
FC: Some other companies have made cuts to the number of products they make to account for high demand. Have you cut down on your products at all?
AM: One of the very early things we did was work with our business units, sales, [and] customers [to get down to about 15 SKU’s] and focus our energy on disinfecting. We had just launched a compostable wipe, but it did not have an EPA disinfecting claim, so we stopped making that so we could focus on disinfecting, focus on those products that have a priority in a healthcare setting. We made some other choices to preserve raw materials.
It’s been a lesson for us on the value of SKU simplification.”
Clorox’s Andy Mowery
When you get outside of wipes, there are some spray products that use similar ingredients, so for a short period of time we discontinued 409, which is a product that many people may not associate with Clorox, but we discontinued that so we could make more Clorox Cleanup [and] allocate more materials to things like wipes. We’re starting to be able to add stuff back in. Bleach was the first to recover. If you go to the store you’ll be able to find bleach now, and we’re starting to add back more variety of products. But I don’t know that we’ll ever want to see it go all the way back. It’s been a lesson for us on the value of SKU simplification.
FC: Have you used any smart factory technologies to fill in the gaps in your manufacturing?
AM: Something we’ve been working on is the use of portable wearables. We were working on it before all this happened, but this environment turned it into something we had to do. We’re in a situation where we couldn’t fly an engineer or a technician to a plant to troubleshoot if we have an issue. So now we have someone in the plant who can put on a wearable technology, like smart glasses with an iPad, and an engineer sitting anywhere in the world can help them diagnose and fix that issue. We [used this technology to approve] new suppliers, where normally we would want to go put feet in their plant. We sent them a set of smart glasses and said, “Walk around the plant, I need you to go here, I need you to see this.”
We even did it with our auditors. When we do wall-to-wall inventory, normally your auditor sends two junior auditors and they stand there and watch you do your counts, but we couldn’t do that. So we had people wear glasses and watch on a laptop, so they can visually watch the work that we’re doing. And that’s a game-changer. That’s the kind of thing that, even in a post-pandemic environment, I want to do more of that. Fortunately, we were using it to a degree prior to the pandemic, so we didn’t have to cold-start it. We’ve been making a lot of investments in technology and the supply chain leading into the pandemic, and they’ve paid off hugely.
FC: What haven’t you figured out yet?
AM: The $64 million question is: What is the future demand? Is it at this 500% level that we see today, is it at 50%? And you have to think about how you want to prepare for that. I don’t want to have five times as much equipment that sits idle for the next 99 years if this is a one-in-one-hundred-year issue. But if this continues, or we see resurgence two years from now, how do I want to handle that? Those are big, hard questions with no easy answers.
More from Fast Company’s Shape of Tomorrow series:
- Is advertising really dead? Here’s how the leaders of Droga5, TBWA, Wieden+Kennedy, and more are inching forward.
- The retail Armageddon may have finally arrived. Here’s what top executives at Nike, Athleta, and more think it will take for stores and brands to make it through.
- Top execs at the NBA, Major League Soccer, and more describe a touchless, waitless, and possibly even more connected and diverse future of sports.
- Four experts on why performance reviews might be a thing of the past.
- Watch out Amazon: Walmart could be the comeback story of the COVID-19 era. Here’s how brand perception is changing.
- How the leaders of Barry’s, Orangetheory, Peloton, and more are bringing fitness classes into people’s homes and rethinking the studio experience entirely.
- NHL commissioner Gary Bettman shares lessons from the bubble.
- Four higher-education experts on how COVID-19 is upending the college experience.
