Jeff Neild, national head of employee and industrial relations at EEF, explains why communication is the key to workforce flexibility.
UK manufacturers have responded successfully to global competitive pressures by moving away from cost-based production towards innovation and product development. The ability to seize opportunities and respond quickly to changing market circumstances has underpinned this transformation. In consequence, however, the industry has seen increasingly unpredictable order flows coupled with a need for capabilities spanning design, manufacture and servicing.
As manufacturers strive to exploit niches, respond to customer needs and tap into new export markets, a flexible workforce is crucial to success. Competitive pressure means it is vital that employee resistance to new ways of working is overcome – and the onus is on leaders to communicate what change means for the company and individuals.
In a recent EEF survey, most manufacturers (80%) said they had achieved the flexibility they needed through a cooperative relationship; a whopping 94% said cooperation would be vital in the next three years.
Changing working practices and hours is not easy but the benefits could be considerable. Manufacturers can use a range of practices to achieve flexibility and managers should have a set of tools to choose from depending on company circumstances or market conditions.
Changes to hours worked
Overtime can provide a quick response to unexpected situations but it can be costly. It should only be a short term approach, particularly as many overtime agreements are voluntary.
Varying shift patterns through annualised, banked or compressed hours systems may be a better long-term solution to achieving flexibility.
Annualised or banked hours systems are helpful to businesses with volatile demand patterns. They can be used to reduce working hours in a lean time, holding them in reserve for a ‘return to usual’ scenario. Compressed hours also help to match the availability of labour to fluctuating demand, although the approach may be better suited to industry sectors where fluctuations are predictable.
Changes in workforce size
Decisions to reduce or increase the workforce can be vital to maintaining flexibility. Many manufacturers use temporary workers on non-standard contracts, however, those with short order books are less likely to find temporary workers effective in achieving flexibility.
During a downturn, companies can retain key skills and minimise job losses through a variety of measures including job-sharing, multiskilling, voluntary unpaid leave, short-time working and a tighter control on pay.
Varying production practices
Many companies operate at multiple sites and have collaborative working relationships with supply networks. This allows them to move production across facilities in response to demand.
No single answer
The measures manufacturers apply to achieve day-to-day flexibility are influenced by their size and sector. There is no “one size fits all” approach.
In today’s manufacturing climate, change management can be tough. It is not easy to win-over employees or trade unions in an economic squeeze. But with the right HR approach and understanding of employment law, employers can create a flexible and productive workforce without the risk of litigation.
That is why EEF is providing resources and events to support manufacturers. To kick off we are offering an HR Change Assessment Tool that allows managers to find out where they stand against best practice in change management.
In May, we are releasing free resources to help managers build flexibility into their workforces. These include guidance on how to change workers’ terms and conditions, implement lean manufacturing systems, optimise working time and reduce overtime while managing absence effectively.
Take advantage of EEF’s free online resources. Visit www.eef.org.uk/change
On July 5 will host a flexible workforce event: Flex for the Future. See www.themanufacturer.com for more details
