By Asa Fitch 

March probably felt like the longest month ever for many chief executives. In a matter of weeks, the new coronavirus went from a major disruption in Asia to a full-blown global pandemic that shoved business-as-usual out the window.

Sanjay Mehrotra, chief executive of Micron Technology Inc., has been weathering the storm for the past three months. The chip maker has testing and assembly operations in China, so the 61-year-old executive has been addressing Covid-19's toll since January.

He retooled procedures to keep production lines running. As a result, Micron products have remained in supply as America increasingly works from home--a migration that heightens demand for the memory chips fueling the necessary tech infrastructure.

"We're doing our part in terms of being ahead on the curve," Mr. Mehrotra said in an interview.

Micron started handing out protective gear to employees across its many sites throughout Asia on Jan. 23. It started to take employees' temperatures in the region the same day.

Realizing in early February that some disruption would be unavoidable, Mr. Mehrotra deployed a "red team, blue team" approach to working at its Asian factories. Micron sent two sets of teams with overlapping skills to separate parts of facilities. If individuals on one team fell sick, the other team stepped in, minimizing stoppages and containing the spread of infection.

To avoid cross-contamination, red and blue teams were assigned different entrances, cafeteria shifts and buses to go to and from factories. Many people were moved onto work-from-home rotations to reduce the number of people in factories at any given time.

Micron also set up backup remote-operating centers at all its factories. That way, even if people working the machines got sick, chip-making operations could keep running using automation.

Mr. Mehrotra assigned Manish Bhatia, the executive vice president for global operations in Singapore, to oversee the system.

Also in late January, Mr. Mehrotra investigated the supply chain for potential choke points. Micron started to stock up on silicon wafers--the thin substructure on which chips are built--and industrial chemicals at its chip-making factories, allowing production to continue even if raw materials became harder to ship.

New suppliers were tapped to further mitigate disruptions.

The CEO's strategy was tested on March 18, after the Malaysian government restricted movement and shut nonessential businesses. This affected Micron's facilities that test and assemble chips.

The company joined other electronics producers and lobbied Malaysian officials to be classified as essential, arguing that memory and data storage products allow millions of people to work from home. Micron pointed to its red-team, blue-team approach as a way to manufacture chips safely. The government agreed and allowed Micron and others to restart operations on a limited basis.

Similar efforts by the U.S. semiconductor industry to convince state and federal governments that chip production is essential are now under way.

"Managing the mix of this has been certainly challenging for our team," Mr. Mehrotra said. "Things have been brought upon us, even with the proactive work, rather suddenly."

The U.S. semiconductor industry has yet to face large disruptions. Still, Mr. Mehrotra has rolled out the safety precautions he created for Micron's Asian facilities at chip-making factories and other key facilities in Idaho, Virginia and Utah.

The mix of products has also changed to reflect changing demand. It has shifted production from memory for smartphones, where sales are falling, to products for big data centers that support cloud-computing services needed for remote work.

Last week, following a favorable earnings report, Mr. Mehrotra said Micron would spend $35 million on initiatives that fight coronavirus or blunt the financial pain the pandemic inflicts on people. This plan includes $1,000 checks to U.S. employees making less than $100,000 annually.

Mr. Mehrotra, of course, is by now a videoconferencing veteran. Virtual happy hours are commonplace, and company leaders conduct weekly calls with thousands of employees at a time. Nobody's dressing formally these days. Mr. Mehrotra only puts on a button-up shirt if he's going on television.

"I wear normal shirts, and I may be wearing shorts underneath," he said.

Write to Asa Fitch at asa.fitch@wsj.com

 

(END) Dow Jones Newswires

April 01, 2020 08:14 ET (12:14 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.
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