Tire industry insiders say some changes will stick once ‘normal' returns

Even one year into a COVID-19 lockdown that has staggered the U.S., there still are so many questions.

When will vaccinations truly be available to the masses? Where does the economy go from here?

And when will there be a return to normal, whatever normal is at this point?

"That is the question: What is the new normal going to look like?" said Jochen Etzel, CEO of Continental Tires the Americas L.L.C. "I guess nobody really knows 100 percent, but I think it will be a mix."

As the fog of COVID-19 eventually lifts, companies will use a combination of past practices along with what's been learned over the past year to navigate the future.

Virtual meetings, for example, are likely to supplement traditional business travel and face-to-face gatherings, Etzel said.

"I think that will stick," he said. "I don't think that will ever go away."

At the U.S. Tire Manufacturers Association, CEO Anne Forristall Luke said the pandemic has her questioning the idea of normalcy.

"I don't know what that means anymore," she said.

Regardless of how normal is defined, living through the pandemic has shown Luke there is a flexibility in the tire industry.

"What I learned about myself, the industry, our team and so many other partners that we've worked with in the past year is just how resilient and devoted to each other's success and wellbeing we are," she said. "We are agile and resilient and able to quickly figure out how to navigate and also how to help one another.

"In the tire industry, in particular, the pandemic gave us an opportunity, I would say, to reinforce and solidify how our industry is an essential part of the American economic ecosystem."

With more than 500,000 deaths in the U.S. and more than 28 million COVID-19 cases, virtually everyone has been touched by the pandemic. That includes Roy Littlefield, CEO of the Tire Industry Association, who lost a close friend to the illness on Christmas Eve.

"The whole work environment is going to change," Littlefield said. "I think there will be long-term impacts on this."

Still, work must go on, and it does at TIA, despite the challenges faced by the entire country—the entire world.

For many associations, COVID-19 has dented budgets as in-person meetings and conferences have been put on hold until the country can steer clear of the pandemic.

"It's really impacted a lot because of the financial challenges that come out of something like this, the health challenges," Littlefield said. "Everybody in the office has somebody they know who has got it, has passed away because of it, somebody in their family. It's a different environment."

TIA has not had to trim jobs or salaries, but with an uncertain future, the organization knows that day could come if COVID-19 impacts linger.

Human connection needed
The association also has seen first-hand how the virus has hit member companies.

"I think that we're all coming away from it with so many tragic stories from our members, that it has an impact on all of us, that what we do everyday really matters for so many people," Littlefield said. "So I do think it's tied us closer to our members, if that's possible."

At the same time, he said it's "very challenging and difficult not to see anybody."

Associations, like TIA and USTMA, are built around similar interests. But at their core, they are about the people whose work brings them together.

Missing out on that human connection that meetings and conferences provide has been especially difficult, Littlefield said.

The dramatic rise in the use of virtual meeting services such as Zoom and Microsoft Teams has created deeper bonds, in some ways, than actually being able to meet in person, Etzel said.

Past hesitancy to rely on virtual meetings has melted away in the face of the restrictions created by COVID-19. "All of a sudden, we learned that these things do work, and it was not as negative or risky as some people thought," Etzel said.

For Continental, that includes not only staff sessions, but meetings with customers as well as product introductions. "I think there were some people who, in the past, were very hesitant," to rely on technology to connect, he said.

Etzel also sees a future where online and in-person gatherings co-exist and complement.

"I think we're also at a point where we will be going forward much smarter with combining in-person visits, travel, but also then continuing to rely to some extent on virtual interaction," the Continental executive said.

"For me, one of the positive things, again talking about our teams, is really the trust across the organization that I hope will stick. Managers and team members have really experienced how they can rely on each other. I think that's definitely something I expect to stick. Also the stronger relationships and the more frequent interactions."

People are interacting much more online compared to less-frequent in-person visits of the past. While these virtual meetings are not as intense as meeting face-to-face, the increased frequency makes up for that to some extent, Etzel said.

Luke agreed that there is a dichotomy that being separate in some ways is bringing people closer together.

"If anything, these challenges have shown us in the last year, and the major disruptive forces that we see, the power of partnership, of collaboration, of working together. I think it's going to really define success going forward. Even more so than it has in the past," she said.

Despite the ability to connect online, Littlefield said there still is no substitute for certain face-to-face meetings, whether that means advocacy work on Capitol Hill or conference gatherings around the country.

"You can't go downtown right now and see any congressmen or senators," Littlefield said. "No reservations. No group of more than 10. You don't know if you are going to have Vegas in September," he said about the group of automotive-related shows held annually.

"That personal contact is very important for everybody," he said. "I'm concerned about that. I'm concerned about membership. We were very fortunate last year. We still had a very large membership increase. But that's unusual for an association right now."

Transformational change at Michelin

Michelin North America Inc. experienced a number of organizational changes as a direct result of what it learned from facing the pandemic's biggest challenges, Chairman and President Alexis Garcin said in an email interview.

"As a result of COVID, we're experiencing a tremendous transformation—in the way that we work, travel, consume, socialize and network, to name a few. In addition, our Michelin supply chain and manufacturing processes have evolved to address this transformation," he said.

"One clear example of this transformation is how we have approached communications since last March. We quickly evolved our communications with both customers and our employees to be much more transparent and frequent," Garcin said.

"Before the pandemic, our internal communication with employees was 80 percent top-down through monthly or quarterly meetings. When the pandemic began, we were all faced with a great deal of uncertainty. As people, we were looking for connections and reassurance. So we completely flipped our approach and began to reserve 80 percent of our time to answer employees' questions, and on a much more frequent basis—weekly via company-wide town halls," he said.

"And we have been going through this pandemic as one, generating trust, engagement and agility," Garcin's email said. "This is something we've learned, and we will never come back to where it was before."

COVID-19 also proved there needs to be a balance between mobility and protecting the environment, he said. And that will help guide Michelin in the future.

"The pandemic confirmed that we must balance the needs of people, profit and the planet with the same intensity: this is what we call our all-sustainable strategy. We saw the mobility being reduced sharply in the first half of 2020. The planet flourished. But look at the impact on the people side in society: furloughs, layoffs with more people facing poverty. This is not sustainable," Garcin said.

"So, clearly, this crisis confirmed that we must promote mobility—which is a proxy for the economical and human development—while protecting the environment. There are no other options. This is what is at the heart of our sustainable strategy that we anchor around people, profit and planet," he said.

As for the outlook for 2021 and any return to normal, this is what Garcin had to say:

"We are in a situational crisis, the full extent and consequences of which are yet to be measured. We will continue to enforce our stringent safety protocols that have helped to keep our employees safe for the past year. It is hard to predict how the pandemic will continue to evolve, so we remain vigilant."

Michelin has been focusing on "transforming through this challenge," Garcin said. "I have been amazed at the tremendous agility and resilience of our employees."

Michelin also has seen customer satisfaction grow during the pandemic as company employees set up weekly remote meetings with customers and adjusted to their needs, Garcin said.

"We have learned to be more agile, humbler too. Given the uncertainty we face, I think it is critical for us leaders to be humble and listen to our teams," Garcin said. "There is much power in collective intelligence, a lesson our employees taught us, and especially taught me, in the last months through their tremendous agility and perseverance."

Luke said that despite the challenges of COVID-19 that 2021 brings with it goals USTMA wants to achieve, including continued work on safety of both the industry's work force and consumers. And work will continue of ensuring that regulations allow association members to continue to innovate. There also are bridges to build with the new Biden administration.

Last year saw many forces at play, maybe like never before. And this sets the stage.

"It's not just the pandemic, right?" Luke said. "2020 had multiple transformational forces, whether it was the public health crisis, the economic crisis, the racial reckoning our nation went through starting this past summer and also the political divisions we had to deal with all at the same time."

Tire companies, she said, can help keep "a spotlight on the opportunity and responsibility for businesses to lead toward a better society, to be a constructive force in the midst of all these transformational forces."