This spring saw an example of an industrial surge capacity as companies such as Ford and GM revamped factories to produce medical ventilators to respond to the COVID-19 pandemic. While the pandemic rages on, enough time has passed that we can look back at the surge and ask whether it was a success or failure. The answer is clearly yes – as this article from today’s Washington Post illustrates. The surge produced a lot of ventilators (so it was a success); too many in fact (so it was a failure according to some).
The ventilator case (which I’m sure will end in business school courses) illustrates both the strengths and weaknesses of the surge process. Successful surge requires a high level of adaptability. Such adaptability is beneficial for normal operations in a rapidly changing market environment. However, an ad hoc surge process risks the overcommitment of valuable resources. Having contingency plans that can be adapted to the situation would more effective and efficient.