How one company turned their business on a dime…and back again
By John Graham
On March 20, 2020, Winkler, Manitoba-based ICON Technologies, a manufacturer of after-market parts for recreational vehicles, decided they needed to quickly pivot their business in response to the hard-hitting effects of the COVID-19 pandemic.
Faced with an immediate halt of new orders, current customers deferring delivery of orders or cancelling altogether, and an order book that basically emptied in a matter of days, the company was in crisis.
However, they didn’t shutter their operations and there was limited to no reduction in staff count. How did ICON do this?
Well, they pivoted their business in only weeks from the usual plastic repair and replacement parts for recreational vehicles that have gone out of production due to model changes or where companies have gone out of business, and the OEM parts to manufacturers in both Canada and the USA. They went full speed ahead in developing, testing, and producing a line of personal protective equipment (PPE) that found an immediate market in the new normal of the COVID-19 pandemic.
I spoke with John Loewen, CEO and Owner, and Howard Sawatzky, Production Manager, to learn more about how ICON Technologies weathered the unprecedented economic storm. They also brought in their colleagues, Jordan Martindale, Marketing Manager, and Harv Giesbrecht, Business Development Manager to provide additional comments.
John Graham (JG): What happened at ICON when the COVID-19 pandemic hit?
John Loewen (JL): In mid-March, orders from existing customers just stopped. Delivery of orders in-hand were either postponed or cancelled, and by April 1, we had no orders and no indications of orders to come.
JG: What options did ICON consider?
JL: Senior management got together and weighed a number of options, including staff reductions or workshare, building inventory and waiting to see where the downturn would go, working on internal improvement projects, and product development in line with the current business.
While layoffs or workshare were on the table, they didn’t get the most consideration. The tone was focused on “things will get better” kinds of initiatives. The greatest goal was to keep our team intact so we could react quickly if/when things turned around again.
JG: How did you end up deciding to produce PPE?
Howard Sawatzky (HS): I have family working in health care, so I knew the needs first-hand.
The first question was “can we build ventilators?”. This was the item in demand at that time and seemed most critical. I reached out to CME Manitoba, who connected us with people in the medical device field.
As we talked over the idea, it became apparent the technology involved was too proprietary to get into quickly and make a real difference. Face shields, on the other hand, were comparatively simple given our equipment and our supply chain connections, so I decided to explore that more carefully.
JG: What support did you receive from senior management?
HS: Our structure at ICON is pretty flat. I had a crude prototype ready to go Monday morning and hung it on John Loewen’s office doorknob where he couldn’t miss it when he arrived.
Over coffee, his first question was “Is this what I’m going to be wearing now?” He was on the phone right away to our suppliers to see how quickly we could have material delivered, and from there it took off.
It set the tone for how quickly we could pivot. All it took was one meeting, and we were in the medical device business.
JG: What might have happened if ICON hadn’t pivoted?
HS: We were facing immediate layoffs for 90 per cent of our staff within the first few weeks.
JL: Government wouldn’t have had a chance to work with local manufacturers and see what we are capable of. They learned what we could do virtually overnight to give them a local source of supply gave them a great degree of comfort. With overseas supply chains strained by global demand, it was good to know what we could do here to meet our health system’s needs.
Our material suppliers also had to reopen their facilities, so their employees’ jobs were secured by this, too.
JG: Talk me through your first weeks of producing face shields.
HS: Once we decided on shields, it was a quick transition. It was easy to quickly involve all our production staff and use all our capacity to produce and market it.
After the first crude samples, we continued prototyping and solicited feedback from medical professionals in the community and from Boundary Trails Health Centre.
From there, we went into production and began to refine our processes. We managed to ramp up production to over 6000 units per day within a matter of days.
We began to get some media coverage and more web traffic, and we began to get requests to customize our shield. We added shields for use in food processing industry and dental practices.
We also developed a portable countertop cough/sneeze guard and even social distancing barriers for golf carts.
JG: What obstacles did you overcome?
ICON: The biggest obstacle was securing our supply chain. With the whole world trying to secure the same raw materials, demand was huge and competition fierce. Solid business relationships developed through years of working together doing the little things right, like meeting delivery schedules and paying bills on time were critical in this moment.
Another challenge was learning about the customer and the market. How many shields would be required? How much raw material do we need? Who might need them? Where are they located? No one had any firm answers to any of these questions, yet they were all critical in being able to secure supply, plan production, and sort out distribution
Learning how the Health Canada certification process works was another challenge as many jurisdictions were unable to deal with us if we didn’t have a Medical Device License for our product. This process was made even more complex by rules that seemed to keep shifting as the situation changed
JG: How did your ICON team respond?
HS: Every department pitched in and contributed their expertise. The team really felt they were making a contribution to our local and larger community in the pandemic response.
Workstations were created to optimize flow while still maintaining safe distancing requirements between people.
Production staff from our roto-molding and thermoforming divisions were suddenly face shield assemblers and were joined by customer service staff when demand increased.
Graphic design and marketing staff created packaging, labels, and even talked our customer service staff into becoming product models for our website.
Behind all of this was our production planning team who worked at procuring materials, scheduling production, and figuring out logistics for distribution as orders began to flow.
Q. What were the business results?
ICON: First and foremost, we were able to make a contribution by supplying governments, organizations, and individuals with PPE.
We were able to connect on a different level with many of our OEM customers to offer them assistance with PPE as they looked for ways to reopen after shutting down their operations.
We’ve been able to keep our staff fully intact and fully engaged. As the economy has begun to reopen ICON has been able to focus on handling increased demand without having to deal with the issues of reopening after a shutdown and getting everyone back up to speed. Our transition back to regular production has been seamless.
This was a great team building experience as staff from different departments worked together. It kept spirits high during some very tough times, we’re a more unified company as a result.
JG: What are the plans for your PPE products?
ICON: We’ll continue to make PPE available as long as
there is demand. We have raw material and the expertise to begin production overnight if needed. While we’re not PPE experts, the knowledge we’ve gained could be put to use if someone in this area has a need for product with enough volume to start production.
JG: What lessons have you learned from this experience?
JL: It’s like a punch in the gut to have a goal and work hard to follow your dreams and make a difference in the world, only to have a market shift disrupt your business. Maybe the reason so many CEOs don’t survive financial crises is that their egos kick in and they go into denial. It’s easy to brag about successes, and few would describe a downturn in their business as a blessing in disguise, but that’s what we feel.
After going through three market downturns and one global pandemic, we feel we are turnaround experts, not that we want to brag! No leadership book ever has a chapter Manage Change by Pretending It’s Not Happening. I know if our market turns on a dime and chaos ensues, our team will dive into problem solving and adapting our processes to meet the challenge.
JG: What final advice can you share with other manufacturers?
JL: Every organization is going to be challenged, and when the situation is restored, the business is better and stronger than it was before. In fact, celebrating challenges as much as successes is clever because they are flip sides of the same coin.
It’s rewarding to observe chaos and market disruption and know we will not be left out in the cold, because we have the processes and people in place on which we can always depend.