Corona-Chan strikes again

I don’t know who created the above image.  If you know, tell me and I’ll credit them.

Measures to prevent the spread of the Wuhan virus (also known as Winnie the Flu, or Corona-Chan — pictured above in a frightening incarnation) led to my company laying off an entire division last Friday, and a smaller number of people at headquarters today, including me.   But, that’s not the full story.  My ex-employer has been circling the drain for a while.  That division was scheduled to be shut down in May, but the virus gave them a way to not look like the bad guys.  People at the company knew I was planning to leave around April 10th, so I guess I was another convenient push-forward.

My point in bringing this up is that you’ll see a lot of unemployment and financial loss numbers attributed to the virus in the future, but I wonder what percent of them will really be opportunism.  Accountants use tricks to move revenues and expenses backward and forward in time, and when they see a time period that will inevitably have bad numbers for an easily explainable reason, they try to pile all of management’s mistakes in there as well.

My previous employer (not the one I left today, before that) recently declared bankruptcy.  There are far too many reasons to go into here, but I’m wondering if Winnie the Flu might have helped push them over the edge.  After the company was bought by a private equity firm, a series of managers unfamiliar with the industry kept insisting on “lean manufacturing” (what we used to call “just in time”), presumably because they heard someone else parrot the term during a meeting somewhere.

Lean/JIT is where a company basically keeps no inventory of finished product or raw materials.  Things arrive right as they are needed and go out as they are needed.  Sounds efficient, except this company is a custom manufacturer whose customers expect to place an order and receive their product two weeks later, but one significant component takes four weeks to arrive from China, and that’s assuming it’s not Chinese New Year.  So, the managers had a choice:  alienate customers by delivering products two weeks late (leaving the customer shut down and unable to earn revenue), or tell their higher-ups they couldn’t activate the buzzword they’d promised.  I’ll let you guess what they chose.

Well, once China started putting places on virus lockdown, I imagine that two week delay turned into “we have no idea how long” delay, and may have been what finally tanked the company.  I can’t say for sure, as most of my contacts have been fleeing the place over the past year.

This drive for lean inventories might be what’s behind today’s toilet paper shortage.  I’ve been to six stores in three different cities in the last few days, and none of them had toilet paper.  I bought some earlier, so I wasn’t searching for it, but I was curious, so I checked out the aisle while I was picking up other things.  I’m curious whether any of you live in cities where toilet paper is still for sale, but I don’t actually want you to tell me, because people here would probably hijack a train, drive it to your town, and load up all your paper products.

I’m not sure how my unemployment will affect my blog posting.  Normally, when I’m out of work, I obsess over job hunting and it consumes all my time.  But, there may be little point in doing so now.  Companies I’ve dealt with have been incredibly indecisive concerning hiring over the last couple of years, and this virus is the perfect excuse to avoid action.  A couple of employers I’d already interviewed with are putting positions on hold.  So, maybe I’ll resume active blogging and hold my job search to a minimum.

I hope all of you stay employed, avoid as many viruses as possible, and find some toilet paper.

Tags: business, China, corona, coronavirus, covid, covid-19, economics, economy, flu, toilet paper, unemployment, Virus, Wuhan