A new year offers an opportunity for reflection and resolution, and one area that’s seeing a great deal of momentum is HR transformation, particularly for manufacturing firms. Manufacturers face a critical growth hurdle moving into 2017 as the war for talent in engineering and manufacturing technology reaches a tipping point.
According to The Boston Consulting Group and other experts, talent management is the number one management issue facing the automotive sector. Lack of accessible, retainable human capital in key technical spaces will force manufacturing organizations off their growth plans. Successfully competing for and retaining this talent, and focusing it on the goals of manufacturing companies will allow these companies to accelerate growth.
In short: Talent is the new gold asset in many manufacturing organizations. One of my automotive customers recently remarked, “Access to talent is as critical today as access to working capital.”
So why do most HR transformations avoid playing into the huge opportunity to leverage growth through talent management? In my work, and the work of my colleagues in the automotive and manufacturing space, we see three key reasons for failure in broad HR transformations:
- The transformation is considered only an HR transformation. While there may be specific benefits related to the ease of executing and modernizing HR processes, employees are the lifeblood of an organization, and they exist everywhere—mostly outside of the HR organization. Bringing finance, purchasing, engineering, IT, and manufacturing into the mix not only allows HR to be the champion working on behalf of the entire organization, but also enfranchises these other key organizations.
- The transformation does not consider the benefits to other organizations outside of HR. In a recent series of workshops with a large contract manufacturer, our team was able to identify a host of manufacturing area benefits to implementing new HR processes, particularly learning management. These benefits ranged from the immediate (greater compliance, reduced safety incidents, increased talent for task-based improved skills visibility) to the secondary (reduced waste by “error-proofing” processes, increased quality management efficiencies, and reduced overall extraordinary costs). In this case, HR was invited to partner with the manufacturing organization to explore an entire set of outcomes that the organization had not originally considered.
- The transformation is purely business-driven, without regard for existing IT platforms and protocols. While it is essential that organizations leverage a business-driven approach to transformation, doing so without regard to the company heritage around IT can be catastrophic. Some key questions require consideration: Can the IT organization shift to a new or migrate a current platform readily? Can the employees adapt quickly to new processes without IT providing burdensome and expensive “concierge” services? While HR transformations enabled by cloud technologies represent a great method to kick-start a program, even a cloud approach does not operate in a vacuum. We witnessed one organization that had to reboot its discovery of a new HR platform because IT was not in the room, and HR did not have all of the necessary buy-in to actually pull the trigger on a decision. This is wasted time, and wasted time is wasted money to manufacturing companies.
By taking a broad look across the manufacturing organization, HR has a rare opportunity to enable top-line growth while protecting bottom-line operational performance by embracing the current war on talent and meeting it head on. Doing this requires a broad enterprise approach to an HR transformation.
For more future-focused hiring strategies, see Hiring In The Digital Age: What To Consider.