Even before the COVID-19 pandemic, companies were seeing significant changes in labor patterns. Two major developments were in play. On the one hand, as baby boomers reached retirement age and started leaving the workforce en masse, they took much of their legacy knowledge with them. On the other, companies relying on outdated paper-based procedures experienced issues with productivity, quality and even safety in an increasingly digitized world.
The events of the last year and a half exacerbated these challenges. Massive global upsets have plagued the manufacturing industry, from personal protective equipment and chip shortages to storage drums and everything in between — a crisis affecting the entire value chain. Supply is down, prices are up, and even though certain regions of the world are starting to experience some level of normality again, logistics operations across the board are far from “business as usual,” and will likely never be the same.
Adding to these ongoing problems is a widespread shortage of talent. The combination of supply chain disruptions and a lack of human workers is wreaking havoc on the industry, causing manufacturers to reevaluate short- and long-term strategies. The most forward-thinking of these organizations are turning to technology for help.
Companies can look for opportunities to shorten the distance between suppliers and manufacturing facilities where possible, but they can’t move supply chains from overseas to region-based networks overnight. A more near-term solution is needed.
Digital transformation strategies and connected technologies that support workers offer an immediate opportunity for improvement. With connected work, employees have access to the people, information systems and machines that help them do their jobs more efficiently.
Organizations that adopted these technology options before the pandemic have fared better over the past year and a half than their slower-moving competitors, who tend to be at the center of supply chain disruptions. The digitization of work can have a tremendous impact on operational efficiencies for all players in the supply chain. For example, the ability to share data between suppliers and customers enables processes to be measured, evaluated and transformed, allowing manufacturers to address supply chain issues before it’s too late. Technology can also provide visibility into the factory floor for other parts of the organization, such as quality assurance or compliance, and can enable a more integrated approach to resource planning or internet of things (IoT) initiatives.
Supply chain disruptions make it difficult for manufacturers to keep up with demand while keeping expenses down. In this landscape, even the most prepared companies are forced to do more with less, and workers are often the first to go.
Though the manufacturing industry has been facing talent shortages for some time now, last year’s lockdowns exacerbated the trend. Seasoned workers either were laid off or opted for early retirement during the pandemic, taking with them decades of experience and institutional knowledge. Now the skills gap is expected to leave 2.1 million manufacturing jobs unfilled by 2030 in the U.S. alone.
Human talent is undoubtedly the industry’s most valuable resource. As the talent shortage continues to worsen, manufacturers must make changes now to bridge the gap.
To take advantage of a finite number of skilled workers, employers need to take a holistic approach by enabling workers to collaborate with machines on the factory floor. Human talent, in combination with digital tools, makes the “more with less” mantra a reality.
Even as life returns to a sense of normalcy, the pandemic will continue to have long-lasting effects on the supply chain and manufacturing. Not all of these effects, however, are negative. Despite the challenges of the past year and a half, the pandemic enabled certain overdue changes for a new generation of manufacturing. By adopting digital technologies that amplify human talent, companies have the opportunity to emerge from this crisis with operations that are more productive and resilient than ever before.
Lawrence Whittle is chief executive officer of Parsable.
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