Volatility & Uncertainty Reign
There is no doubt that volatility and uncertainty reign in the world, the economy, and in end-to-end supply chains. From the bombshell tariff announcement that sent the market into a steep panic to wars raging around the the world (Russia-Ukraine, the Middle East) and tensions escalating (China and Taiwan and the Philippines) to cyber attacks on infrastructure and systems (Salt Typhoon, Silk Typhoon) and weather events (Hurricane Helene), risk is at an all-time high. Companies will reconfigure supply chains towards a regional and friendly partner view, manufacturing investments will soar, and AI will dictate the future. If you want to take advantage of the opportunities, focus on building your talent.
Why Should Talent Be a Priority?
Manufacturing will surge as companies move towards regional supply chains to secure supply, ensure customer success, and mitigate the impact of tariffs. There is a skills gap with estimates starting at one million people. Thus, manufacturers should invest in upgrading their capabilities, capacities, and choices.
- Capabilities: If you want to be prepared to fulfill orders when the opportunities arise, you must ramp up your capabilities (machinery, equipment, skills, supplier base, etc.).
- Capacities: Similarly, increase your capacities. How rapidly can you scale up or down without hiring and firing people like a yo-yo? Can you reallocate engineers easily in an ETO/ CTO environment?
- Choices: And, it is quite the challenge to manage in VUCA-laden times without choices. Can you reallocate production from one facility to another? Do you have multiple supplier options with the capacity to ramp up quickly? Do you have access to energy and natural resources to support growth?
What do capabilities, capacities, and choices have in common? People.
Building Your Talent Base
Thus, you must start by building your talent base. A few strategies to build talent include:
- Utilize talent: Take stock of your talent. In 20 years of consulting, every single client had an opportunity to better utilize talent. Some had hidden opportunities to leverage already-existing talent.
- Upskill talent: Provide opportunities for training and development. Invest in your people. Build their skills, provide new experiences, invest in their use of ERP and advanced technologies, and give them opportunities to try new ideas. Encourage collaboration and group learning/ contests. Developing leaders will be vital. Read more in our article “The Leadership Opportunity in Supply Chain“.
- Cross-training talent: Cross-training your people so that they can seamlessly move to additional functions, operations, and projects as needs change. Develop collaborative goals so that if the team (and company) wins, the employee wins.
- Support & supplement talent: People are far more successful when they feel supported and invested in. Supplement your teams with temporary employees, offload resources, consultants, trusted advisors, etc.
- Expand talent: One of our favorite client stories is a client that hired an engineer at the low point of a recession when everyone else was laying off employees. That engineer developed a new product line that helped them soar to the top of their industry several years later. Think about your future talent. Don’t sink funds into the past; instead, invest in the future.
- Expand & build talent relationships: Similarly to investing in employees, expand your supplier base, build collaborative relationships with customers and suppliers, expand collective relationships and capabilities with supply chain partners, build new relationships with other potential partners (competitors, other unusual partners with a potential win-win outcome, etc.
Create a culture of innovation: A key way to build your talent base is to invest in a culture of innovation. People will make mistakes. Consider it an investment so long as the same mistake is not repeated. In fact, celebrate unsuccessful ideas and trials.
The Bottom Line
Success or failure will depend on your talent. If you wait for stability to invest in talent, your competition will pass you by. On the other hand, if you think proactively, invest smartly, and build your talent, you will be able to take advantage of vast opportunities.
If you are interested in reading more on this topic:
Top Talent: The Key to Manufacturing Success