There are reports and discussion aplenty these days about the global skills shortage in manufacturing. Recently a World Economic Forum Report published in collaboration with Deloitte Touche Tohmatsu Limited on the Future of Manufacturing: Opportunities to drive economic growth estimated 10 million jobs globally in manufacturing cannot be filled today due to the growing skills gap.
If you are CEO of a manufacturing company currently facing a skills shortage or one that has yet to feel its impact, surely you recognize it is time to elevate talent management to a strategic level in your organization. Without it, you may lose your ability to compete with other manufacturers who are putting talent first.
Some Troubling Statistics
The 2011 report Boiling point? The skills gap in U.S. manufacturing published by Deloitte and the Manufacturing Institute, found 68% of manufacturers cited a highly skilled, flexible workforce as most important to their company's future business success during the next three to five years.
However, the 2011 Next Generation Manufacturing Study (PDF link) prepared by The Manufacturing Performance Institute reported only 13% of manufacturing companies surveyed have a company-specific strategy for human-capital management with full functional involvement and buy-in. The same study also found 71% of companies had no talent-development program to drive world-class human-capital management into the next generation.
From page 11 of the 2011 Next Generation Manufacturing Study:
Manufacturers have a fundamental disconnect when it comes to talent management. How is it that most manufacturers identify a highly skilled workforce as an important driver for future business success, but almost the same number has no talent strategy in place with full functional involvement and buy-in?
CEOs: Invite HR to the executive table and make talent management a strategic objective
The manufacturing company that raises talent management to a strategic level will see payoffs in terms of its ability to stay competitive in the market. The most practical and strategic way to manage a skills gap is through employee retention. Employees who are valued, adequately trained, coached, and who understand their unique impact on company growth have a higher propensity of staying with the organization.
Retention is a critical part of a larger talent-development program. But how can HR carry out such a program if there is no strategy for human-capital management? CEOs, if you are not equipping HR with the tools, direction, and executive support for an integrated talent-development program to support a retention strategy, you are losing your competitive edge.
As Craig Giffi, Vice Chairman and Consumer & Industrial Products Industry Leader at Deloitte LLP in the United States, who helped author the Future of Manufacturing: Opportunities to drive economic growth report (linked to at the top of this post), said: "In the race to future prosperity, nothing will matter more than talent. The skills gap that exists today will not likely close in the near future, which means companies and countries that can attract, develop and retain the highest skilled talent-from scientists, researchers and engineers to technicians and skilled production workers-will come out on top."
Create a Feedback-Rich, Development Focused Culture
Today's competitive manufacturing environment requires a high-performance workforce that is skilled, engaged and accountable, and a strong talent management program can help.
Watch this short video to learn how Basic American Foods (BAF) created a development-focused culture to improve employee engagement and productivity. You can also read the full BAF case study here.