Veterans of manufacturing’s Golden Age — of assembly lines and make-to-stock inventory — will remember when industry classifications were clear-cut and definitive. Automotive manufacturers made cars. GE made light bulbs. Goodyear made tires. Whirlpool made washers. The customer was always right. It was all so simple then.
Fast forward to today. We all know manufacturing has changed tremendously with many positive advantages to the consumer. Auto manufacturers make cars that include entertainment and communications systems. Goodyear has an aerospace division. GE’s focus is on renewable energy systems and networkable kitchen appliances.
Defying old classifications — In today’s demand-economy, the consumer has more options for brand and product specialization than ever before. Waiting weeks or months for a special order is fading into history as something our parents and grandparents had to suffer. Today, next-day delivery is becoming the norm. And, we’re not just talking about standard products in inventory. We are talking about personalized products too, from custom imprinted T-shirts to sports bottles made with your team’s logo. We can clearly see how the consumer benefits, but what about the manufacturer? How does a manufacturer survive in this era of whirlwind innovations, mass customization, inter-operability, and internet-connected products?
It isn’t easy. For one thing, those clear definitions and industry segments of the Golden Age, are long gone, extinct with olive green appliances, watches that required winding, and doors that needed a key.
High-tech is pervasive. Nearly every product has some degree of high-tech or electronics associated with it. Think about it: After a few minutes of trying to list some products that are completely non-tech, your inventory may include salt and pepper shakers, shoelaces, toilet paper, and pencils …
Forget the old boundaries. Today, all manufacturing is high-tech manufacturing. For manufacturers, this means it’s time to step up to the challenge. Inventory systems must track versions, compatibility, and upgrade options. Products that have chips, electronic read-outs, digital settings, and smart sensors all have version-control issues and limited lifecycles to manage. An outdated inventory tracking system isn’t going to manage the modern complexities associated with electronic components, such as model obsolescence, safety compliance, parts traceability, and replacement/repair policies.
The expanding use of electronics in all types of equipment, from forklifts to road equipment, means manufacturers must also adapt their production processes. Changing quality control standards, establishing checkpoints, and redefining inspection protocols are among the changes. Personnel may need to be retrained, and new guidelines for hiring standards may need to be established. Assembly of high-tech components may even require special environmental conditions, such as temperature controlled warehouses, cleanrooms, or use of robotics for intricate work too precise for human hands.
It’s a new day in manufacturing, one that is far more high tech than ever. This is exciting, as well as challenging. Manufacturers must step up now, or make preparation so they aren’t caught off guard. Change is happening quickly, requiring constant vigilance. Manufacturers need to throw out the old classifications of what industries are considered high-tech. Everything is high-tech, especially today’s industrial equipment and machinery.
Fast changing opportunities require agility
Consumer trends have exploded into an era of high-tech, high fashion, and highly volatile fads that come and go in a blur. For manufacturers of consumer goods this fast changing environment is both problematic and exciting. Keeping up with ever changing trends requires responsive inventory, predictive analytics, customer insights, on-demand assembly, and an element of luck.
Each new trend provides opportunities to reinvent your company, appeal to new markets, and find a niche demographic that absolutely loves your product (until the next version of your product at half-price comes along).
Nothing lasts long. If your company is facing languishing sales today, tomorrow it may be thriving. Manufacturers can use this to their advantage, or they can remain firmly rooted in the past, eyes focused on their chiseled-in-stone mission statement, and watch as their customer base erodes, like a sand castle in a wind storm.
Manufacturers can take advantage of evolving customer demands by evolving at the same pace. This means operational changes as well as nurturing an opportunistic mindset among personnel, especially the C-Suite officers.
Operational flexibility is essential. Customers, including customers who purchase large industrial machinery and equipment, demand options and expect personalized attention. Speed of delivery and an enhanced customer experience are other must-have essentials. Thanks to technology, manufacturers can meet each of these requirements. Some common tactics include:
• Configuration tools help manage product customization, allowing customers to enter specifications and see virtual renderings of their MTO and ETO pieces of equipment.
• Modularized design and late-stage assembly support product customization. Modules are pre-assembled and stored, waiting for actual orders to come in so the assembly is completed according to the customer preferences for finishes or other details.
• Collaboration tools are used by some B2B manufacturers so that customers can work directly with design engineers to develop product concepts or confirm specifications.
• The customer experience, including aftermarket service, can be enhanced by Customer Relationship Management (CRM) tools and solutions to manage call centers and track maintenance contracts.
• Role-based workbench tools allow personnel throughout the organization to be attuned to the needs of customers, monitoring personal Key Performance Indicators (KPIs) so they can spot customer-impacting issues and take corrective actions.
• Cloud deployment provides ultimate agility. The speed of deployment allows manufacturers to follow opportunities into new regions, new markets, and new partnerships with co-manufacturers and fabricators. Cloud deployment lets IM&E manufacturers have new divisions and specialized shops up and running in weeks, not years.
Above all, manufacturers must have a new mindset. They must be focused on innovation, creative problem solving, and timely product launches. Today, new releases with enhanced features are the name of the game. If a manufacturer wants to stay competitive, it must focus on innovation and agility.
Blurring definitions for jobs, skills required
As manufacturers scramble to reinvent themselves and accommodate today’s demand-economy, staffing is one of the areas where old definitions are becoming blurred. The stereotypical blue-collar laborer, who stands at a station on the assembly line all day, mindlessly repeating the same task for an 8-hour shift, is becoming an outdated image.
In the heyday of mass production, manufacturers often prioritized a worker’s physical attributes over technical skills and education. In hot, noisy industrial plants, workers needed stamina to withstand the conditions, strength to hoist heavy equipment, and endurance to bear the monotonous, tedious repetition of assembly line life. Above all else, the worker needed to follow directions without deviation or debate.
Shop-floor operations have drastically changed, so it is logical that the workforce should be drastically different too. Today, workers assigned to operate large industrial equipment and machinery are typically educated, well trained, and encouraged to make suggestions. Rather than performing repetitive assembly line tasks, shop-floor personnel are more likely to be seen entering data at an equipment control panel, checking order details at a computer station, or monitoring digital stats and quality metrics on a hand-held tablet. Personnel throughout an organization, in multiple levels and roles, need to be computer literate and able to make well-informed decisions based on data and logic.
On the surface, this may sound like exciting news for the 8 million people in the U.S. who are unemployed. The new opportunities and new types of jobs have not always translated to successful alignment with job candidates, though. In fact, some manufacturers have faced obstacles in staffing for the new technology-driven factory of the future, hearing that candidates are reluctant to accept jobs in the manufacturing segment. Misconceptions about work conditions and job security prevent job seekers, especially millennials, from pursuing these positions.
There is also a national shortage of technology/engineering skilled workers, some say. The so-called “skills gap” left by retiring Baby Boomers is an issue that has been debated in the trade media with mind-numbing frequency. Finger-pointers often blame the low rate of STEM (science, technology, engineering, math) graduates from U.S. public schools and universities. The manufacturers themselves have to bear some of the responsibility, though. Apprenticeship programs, scholarships, and in house-training departments were largely eliminated from manufacturing budgets when the Great Recession hit.
The growing use of robotics also clouds the hiring environment for manufacturers. While robots have indeed helped manufacturers streamline activities and manage precision tasks, the use of robotics has also sent a conflicting message to workforce candidates, reinforcing perceptions that jobs in manufacturing are at-risk of being assigned to a robot.
Robotics Industry Association (RIA) estimates that 236,000 robots are in use in U.S. factories. Only Japan deploys more robotics in its factories. While robotics has influenced the workforce, robots certainly have not replaced the need for humans on the shop floor. Someone has to program the robots, monitor their performance, and provide service.
The changing workforce and need for redefined roles have kept manufacturing—and its growing pains—in the spotlight. These issues are certainly ones that need to be resolved by manufacturers. This is one more area in which technology solutions, such as tools for Human Capital Management (HCM), can help.
HCM helps manufacturers apply advanced talent science solutions to match the right prospects with the right positions. IT solutions also help to track training, certification, and the highly specialized skill sets of each worker.Such issues around blurring job definitions have made manufacturers go back to basics, building teams from the bottom up. Many have even reinstated apprenticeship programs and work with local trade schools on building curriculum to matches current needs. These are steps in the right direction. With such efforts, manufacturers will be able to nurture a new workforce that is aligned with new operational tactics. This is the future of manufacturing. And it starts today.
Larry Korak is the Director of Industry Strategy Direction, Industrial Manufacturing at Infor, a developer of enterprise software ranging from financial systems and resource planning to supply chain and customer relationships.