MANUFACTURER PEER PULSE

Preparing for Reopening and Workforce Reentry Under COVID-19

May 1, 2020

1

REOPENING SOON

2

What is your best estimate for the earliest date by which all of your company’s U.S. facilities will be fully reopened or restored to new “normal” operations?

9%12%

28%

20%

5% 5%

1% 1%

5%

1%

13%

Alreadyfully

operational

May June July August September October December 1H 2021 Untilvaccine isavailable

Too hard tosay

n=75 MAPI member executives who completed an online survey, April 23-28

CONTENTS

Current Conditions

Assessing Readiness

Prioritizing Safety

3

• Operational status and capacity utilization

• Management challenges

• Supplier and customer stability

• Milestones and approvals

• Plan input and decisions

• Plan documentation

• Executive confidence

• New work arrangements

• Emerging safety policies and practices

• Asia-Pacific insight

KEY TAKEAWAYS

• High confidence to fully reopen – respondents report confidence in preparedness to execute effectively on

critical return to work policies under COVID-19, including: screening, use of facial coverings and PPE, social

distancing, cleaning and disinfecting, workforce safety communications, telework, and travel restrictions.• Coronavirus testing requirements is a critical exception in preparedness.

• Uncertainty of COVID-19 spread, slumping demand, and workforce safety top management challenges.• Capacity utilization is lower for 9 in 10 companies during the pandemic, and over half of executives report moderate to

extreme change in number of factory employees working regular hours right now.

• Industry consensus is emerging on must-have safety practices at facilities – 89% are requiring 6 feet of

distance between employees, and more than two-thirds are banning outside visitors except for deliveries.• New work arrangements include reinstating employees in stages, rotating teams, staggering start times, and

customizing hours and shifts, among other creative solutions.

• Policy setting is mostly centralized but implementation varies by facility – about 90% of companies

report documenting screening protocols, for example, and the standards differ by facility for 46% of them.

• Government guidance, demand levels, and other metrics are key indicators to proceed – 74% of

approvals for return to work will require CEO sign off with a longer tail of internal and external stakeholders. • Return to work in the Asia-Pacific region offers important lessons on key protocols, leadership, and government roles.

4

Current Conditions

Assessing Readiness

Prioritizing Safety

5

• Operational status and capacity utilization

• Management challenges

• Supplier and customer stability

LARGE DROPS IN CAPACITY UTILIZATION

6

What percentage of your U.S. locations are either

partially or completely shut down? (i.e., a majority of

workers are not working in-person at company buildings

due to company policy and/or local restrictions)

Overall, which of the following best describes the change to your company’s U.S. operations from levels prior to the COVID-19 pandemic? (e.g., due to closures or decreased demand)

n=75 MAPI member companies

42%

23%

28%

8%

12%

1%

8%

4%

10%

35%

29%

Factories Corporate offices

All76% - 99%51%-75%25% - 50%< 25%None

n=75

7%

31%

11%

15%

20%

31%

31%

43%

35%

23%

29%

19%

29%

9%

23%

21%

9%

6%

6%

2%

Capacity utilization

Percentage of factories that areoperational

Number of factory employeeswho are working regular hours

Average weekly hours of factoryemployees who are working

No change Low Moderate High Extreme

44%

39%

37%

33%

28%

27%

19%

19%

19%

9%

3%

1%

1%

8%

Uncertainty of COVID-19 spread (e.g., second wave)

Financial stability of end customers

Employee willingness to return to work (e.g., safety concerns)

Ability to source PPE and other medical supplies (e.g., masks, thermometers)

Employee ability to return to work (e.g., illness, child care, public transportation)

Supplier capacity (e.g., disruption, financial instability)

Coordination of workforce reentry (e.g., cadence and phases)

Compliance with all local and federal regulations

Ability to source materials to run facilities and offices (e.g., hand sanitizer, paper products)

Implementations of employee safety standards (e.g., screening)

Consistency in internal guidelines across regions and localities

Union concerns

Leadership consensus on policy or procedures for reopening

Other

COVID-19

CHALLENGES: COVID SPREAD, ECONOMY, SAFETY

7

What are your company’s top three challenges to reopening or fully restoring operations?

n=75

• Changing the mindset of

leadership and employees long

term about the new normal and

prolonged, rigorous adoption of

safety protocols

• Screening and testing both

antigen and antibody

• Customer demand

• Efficiently running plant at low

utilization rates = bigger losses

• The lack of general population's

understanding of face covering

recommended use

Demand or Supply

Workforce

MANAGING SUPPLIER UNCERTAINTY

8

Is your company providing assurance to suppliers

about the status of your company’s workforce and

operations?

Is your company requiring assurance from customers

about the status of their company’s workforce and

operations?

41%

21%

11%

3%

24%

Providing when requested

Providing voluntarily

No plans to provide information

Considering

Unsure

n=75

13%

40%

12%

35%

Requiring it

No plans to make this arequirement

Considering a requirement

Unsure

n=75

Current Conditions

Assessing Readiness

Prioritizing Workforce

Safety

9

• Milestones and approvals

• Plan Input and decisions

• Plan documentation

• Executive confidence

KEY INDICATORS: AUTHORITIES, METRICS, DEMAND

10

Which of the following metrics or milestones is your company using to determine timing of reopening or

fully restoring U.S. operations?

91%

43%

39%

33%

25%

11%

11%

5%

Federal, state, and local regulations and guidance

Downward trajectory of documented cases within a 14-dayperiod

Level of demand for products

State and/or local Chamber of Commerce guidance

Implementation of policies and procedures for workforcecontact tracing following a positive employee COVID test

Percentage of employees tested for COVID-19

Percentage of employees able to return to work

Other

n=75

• Institute for Health Metrics and

Evaluation (IHME) analysis by state

• Ability of people to work effectively/

productively remotely versus in the

office environment; availability of

treatments, vaccines, and/or sufficient

testing to reduce exposure risks

DIVERSE APPROVALS REQUIRED

11

Whose approval is required for reopening or fully restoring operations at your company’s facilities?

74%

56%

41%

32%

26%

23%

23%

14%

8%

8%

5%

4%

1%

1%

1%

18%

CEO

Crisis management team

Chief Human Resources Officer

General Counsel or Chief Legal Officer

Plant manager

Head of EHS

CFO

Head of Safety

Head of Risk

Centers for Disease Control and Prevention (CDC)

Public Health Department

Occupational Safety and Health Administration (OSHA)

Factory Investigation Commissions

Union representatives

Head of Internal Audit

Other

n=75

• Head of Operations / COO

• Division Presidents

• Our Executive Leadership Team

together

• Collaboration of business units and

location leadership with Corporate

Executive Council

• Supply Chain and Manufacturing VPs

• Corporate Medical Advisor

EXTENSIVE INPUT INTO COMPANY PLANS

12

Which of the following sources is your company using for input into plans to reopen or restore

operations at its facilities?

96%

88%

83%

55%

49%

41%

40%

31%

24%

19%

17%

11%

9%

4%

State and local governments

Centers for Disease Control and Prevention (CDC)

Federal government

Existing internal plans (e.g., protocols for crisis management)

Occupational Safety and Health Administration (OSHA)

Local Health Department

Regional leadership at your company

Outside legal counsel

State and local Chamber of Commerce

Equal Employment Opportunity Commission (EEOC)

Outside infectious disease doctors/specialists on retainer

Unions

Currently under consideration

Other

n=75

Institute for Health Metrics and

Evaluation (IHME) analysis

MOSTLY CENTRALIZED POLICY SETTING

13

For each of the following areas please indicate where decisions on specific policies or procedures are

primarily made?

n=75

21%

23%

31%

33%

36%

36%

52%

77%

40%

39%

43%

36%

24%

37%

28%

15%

36%

32%

24%

27%

13%

24%

17%

4%

3%

7%

3%

4%

4%

3%

1%

1%

23%

1%

3%

Use of personal protective equipmentand face coverings

Cleaning and disinfecting protocols

Safety communications to employees

Screening protocols (e.g., temperaturechecks)

Testing requirements for COVID-19

Social distancing

Telework policy

Business travel restrictions At corporate (i.e.,centrally managed)

Mostly corporate,with some local input

Mostly local withsome corporate input

Locally, by facility(e.g., plant leadershipand authorities)

Not applicable

SOME DOCUMENTED STANDARDS VARY LOCALLY

14

To what extent has your company formalized each of the following policies or procedures for

facilities in the U.S.?

n=74

32%

43%

55%

64%

64%

72%

77%

96%

11%

46%

41%

36%

26%

28%

22%

3%

42%

8%

4%

9%

1%

1%

15%

3%

1%

Testing requirements for COVID-19

Screening protocols (e.g., temperaturechecks)

Use of personal protective equipment andface coverings

Cleaning and disinfecting protocols

Telework policy

Safety communications to employees

Social distancing

Business travel restrictions

Documented anduniform by facility

Documented butvaries by facility

Not formalizedcurrently

Not applicable

3%7%25%

4%

3%2%4%9%

13%

21%

19%31%

28%39%48%44%

41%

25% 81%69%66%59%

48%47%39%

25%

Business travelrestrictions

Safetycommunications

to employees

Telework policyCleaning anddisinfectingprotocols

Use of personalprotective

equipment andface coverings

Social distancingScreeningprotocols (e.g.,temperature

checks)

Testingrequirements for

COVID-19

Not applicable Not at all confident Not very confident Confident Very confident

LOWEST CONFIDENCE IN COVID TESTING

15

With current policies and resourcing in place at your company right now, how confident are you that all of

your company’s U.S. facilities are prepared to execute effectively on the following upon reopening?

n=75

Current Conditions

Assessing Readiness

Prioritizing Workforce

Safety

16

• New work arrangements

• Emerging safety policies and practices

• Asia-Pacific insight

61%

46%

37%

34%

30%

25%

22%

19%

14%

10%

34%

41%

37%

31%

34%

52%

42%

48%

52%

25%

4%

10%

21%

28%

22%

17%

30%

30%

28%

55%

1%

3%

5%

7%

14%

6%

6%

3%

6%

10%

Telecommute (part-time remote work)

Stagger start times

Reinstate activities by role or by type of work

Reinstate by function

Reopen by region

Rotate team (e.g., diving function in half)

Alternate days between shifts

Condense workweeks (e.g., 4-day work week)

Customize working hours (e.g., parents start work later)

Shorten schedules (e.g., leave 2 hours earlier)

Implementing Considering Not considering NA

PHASING IN NEW WORK ARRANGEMENTS

17

What work arrangements is your company implementing or considering for the first phase of

reopening or restoring operations at any of your U.S. locations?

n=69

EMERGING SAFETY POLICY ESSENTIALS

18

Which of the following general policies will your company have in place for employee safety at a

majority of U.S. facilities?

97%

89%

69%

65%

64%

51%

49%

13%

9%

15%

Cleaning and disinfecting protocols

At least 6 feet of distance between employees at all times

Bans on outside visitors except delivery services

Masks or face coverings required at all times in company buildings

Signs or floor markings to indicate barriers between employees

Common spaces closed (e.g., cafeteria, break room)

Physical barriers between employees

Tracking of employees throughout premises

Gloves required at all times in company buildings

Other

n=75

• Mandatory temperature checks

• Medical screenings

• We are still determining our mask

policy and visitor policies

• Closing smaller conference rooms

88%

67%

61%

59%

28%

22%

17%

7%

4%

6%

New/heightened hygiene requirements

New/heightened PPE requirements

Regular health screenings for all employees (e.g., temperature checks)

Requirement for use of facial coverings or medical facemasks on premises

Health screening for all employees in a facility after a positive test

Fitness for duty form from doctor

COVID-19 testing requirements

Medical staff on premises

Antibody testing requirements

Other

NEW MEDICAL PRACTICES AND PRECAUTIONS

19

Which of the following medical practices will your company have in place for employee safety at a

majority of U.S. facilities upon reopening?

• Testing requirements and

abilities to actually test are

still undetermined

• Common sense and

training

n=69

GLOBAL INSIGHT: ASIA-PACIFIC EXPERIENCE

20

Which countries/regions in which your company

operates is furthest in returning to a “normal” level

operations after partially or completely shutting down?

For the country or region specified, what has been the

most important factor in safely and successfully restoring

operations to a new “normal” level?

Protocols

• Strong emergency management team with established

communication and operating protocols

• Implementing a number of safety protocols such as

temperature checks, social distancing, including providing

company busing versus public transportation, focusing on

hygiene, etc.

• Stringent safety protocols in compliance with Chinese

government

• Testing where available (esp. China) and comprehensive

protocols for protecting employees

• Face masks, social distancing, temperature checking,

enhanced cleaning protocols

• PPE, temp screening, social distancing engineering controls,

such as plexiglass barriers

• Testing; confirmation of locations visited; travel bans

• Testing, social distancing and cleanliness standards

• Cleaning, testing, and PPE

61%

19%

12%

4%

1%

3%

Asia Pacific

We did not have closures

Our global operations are stillpartially or completely shut down

Europe

Mexico

We do not operate outside of theU.S.

n=74

21

VERBATIM: GLOBAL SUCCESS FACTORS (CONTINUED)Protocols (continued)

• PPE and social distancing

• Following guidelines of social distancing and wearing masks

• Formalized medical screening through an online questionnaire combined with some level of antigen/antibody testing

• Availability of PPE for employees; lower number of cases being reported

• Downward curve in new COVID-19 positive cases

Leadership communication and preparedness

• Very structured, well documented processes (program for all elements of employee return, entry, in place work requirements,

PPE, testing, quarantine, etc.)

• Experience in dealing with similar pandemic situations in the past

• Good employees, with careful distancing and especially keeping sick folks home for work

• Communication from our CEO, social distancing, and flexible schedules

• Pandemic health and safety precautions in place; regional state and local alignment to be considered essential to operate;

reasonable supply and demand to justify running

• Ensuring supply chain stability

Local government

• Government restrictions/guidelines

• China government control = reduction in infections

• This relates to China: reducing infection rates, ending lockdowns, and reopening of OEM customers

• The country metrics showing major decline in positive test results

• Government agreement and proper PPE and cleaning provisions

< $500M5%

$500M to $999M 17%

$1B to $2.9B31%

$3B to $4.9B 23%

$5B to $9.9B12%

$10B or >12%

16%

15%

14%

14%

11%

Miscellaneous manufacturing

Electrical equipment, appliance,and component manufacturing

Transportation equipmentmanufacturing

Machinery manufacturing

Fabricated metalproduct manufacturing

22

ABOUT THE SURVEY

Annual Revenue of Company

Industries Represented (Top-5)MAPI Member Executive Participation

n=75 companies

28%

20%

15%

9%

7%

5%

4%

4%

8%

EHS

Human Resources

Manufacturing

Risk Management

Law

Ethics and Compliance

Division Leadership

Engineering and R&D

Other