When an organisation undergoes change, managing directors and CEOs must try harder than anyone to make the change work. They also have to clearly communicate their own ability to change to management and staff. Jane Gray finds out what modern skills are required of manufacturing leaders.
Through-life System Sustainment
In this article, which looks at changing skills for senior manufacturers the demands of new, serviced based, business models are indentified. Recognising the importance of this, Cranfield University has launched a new MSc in Throughlife System Sustainment (TLSS). The course is designed for industry professionals only and is designed to equip senior engineers with the knowledge needed to compete more intelligently in a complex world.
Professor Andrew Starr is chair of maintenance systems at Cranfield University and will be responsible for leading teaching on the TLSS MSc. He explained why the skills and understanding being developed by the MSc are indispensible for manufacturers today.
“This will be the new way to differentiate,” he says. “Most companies in a sector will be using the same materials and often the same suppliers to manufacture their products.” So being able to innovate a distinct maintenance operation is what will set companies apart in the future.This will require a far more integrated perspective. Senior manufacturers who have been more accustomed to a silo-like approach to operations may be challenged by the trend to more cost centre analysis. However Prof Starr is confident that learning how to create a ’holistic solution’ will enable companies to become more than the sum of their parts, thus becoming able to compete confidently with countries with lower labour and energy costs.
“We will be getting people up to date with state of the art technologies and philosophies through in-depth investigative work,” says Starr of the new MSc. The course’s work is based on diverse, real-life case studies which Starr says is critical to the value of the course. In particular, he says that high tech industries like aerospace can learn much to from from lower tech sectors like food and drink. Such low tech industries that have been forced to become adept at optimisation, and are often more agile and open–minded to process.
As new maintenance and service models progress and movement of senior personnel between manufacturing sectors increases, there will be more demand for understanding of through-life systems. Starr emphasises that talented individuals will have a new way to take arguments for innovation to the board with a clear business case which articulates value.
Those in the aerospace, defence and power generation sectors are perhaps most familiar with the concept of through-life services, but Prof Starr says the course has received strong interest from a wide range of sectors including utilities, rail, food and drink, and mining.
The position of managing director or CEO is perhaps defined more than any other position in business by some very traditional preconceptions – and can be prone to allow the incumbent to become set in their ways.
In this article, academics, recruitment specialists and industry leaders discern if big changes in the nature of manufacturing, from a production processcentricity to a longer term intimacy with market dynamics, have shaped new skills requirements for manufacturing company leaders.
For Nigel Parslow, senior consultant at head hunting consultancy Harvey Nash, the first big trend in manufacturing change management was the evolution of manufacturing business models from product-centricity to service models. “Spares and repairs activities are no longer a distraction or a tedious side of business,” he says. After years of product and then process innovation, there is a new demand for those at the top, to become adept at business model innovation.
“Few CEOs have little experience in market development,” says Mr Parslow, “but there is a heightened demand for excellent communications skills. If we look at the traditional engineering company leader, the piece under trial today is engineering capability. The practical engineer who can solve technical problems tended to be slower moving.” Now, according to Rob Lanham at Harvey Nash, there is an appetite for recruiting CEOs with experience outside the company’s sector in order to bring greater perspective, but crucially to bring knowledge of service opportunities from parallel industries.
Dick Hunter, CEO of FMCG equipment manufacturer Molins, agrees with the Harvey Nash analysis, and says that the ability to be personable and communicate confidently is indispensible.
This means that leaders must be outward–looking and change their primary focus from the internal restructuring that many companies went through during and after the recession.
And there are other important criteria. . “Leaders must be internationally-minded,” Mr Hunter says.
“This requires tenacity and thorough knowledge of local practices on both a business and social level.” While Molins has operated in international markets for around 100-years, Hunter sees that smaller UK companies often underestimate the challenges of going global. “Simply exporting is easy enough, but to actually compete in local markets abroad is a different matter,” says Hunter. “You need to be able to sit down over dinner with a customer and empathise with what concerns [them].” Such interaction demands cultural and political sensitivity as well as harder knowledge of local business law and market intelligence.
Hunter believes firmly that international activity is essential for the future of UK industry as the economy stabilises and manufacturing pursues growth. This puts pressure on CEOs to be geographically mobile a demand which Parslow says is hampering some. “Large organisations, such as Procter and Gamble, recruit the best graduates with the prospect of an international career. But as these recruits progress into and out of their 30s, their appetite for travel diminishes.” High UK house prices are amplifying a situation in which potential leaders tend to become less geographically mobile at exactly the time when they might step into a top job [the point is not clear]. To combat this companies are often forced to provide temporary accommodation for as long as 18-months if they hope to catch the candidate they want for a leadership position. Smaller businesses often struggle to swallow this cost.
Understanding workforce requirements
The ability to perceive which capabilities are needed most within the workforce and to acquire those capabilities through recruitment and training is a major skill required of a manufacturing leader. Gary Wyles, managing director at Festo Training and Consulting, argues that while need to upskill front line workers is pressing, company leaders must think about how they enable development in this area.
According to Manpower’s newly launched ‘Talent Survey’, machinists and machine operators make the top 10 of the most difficult positions to recruit. Those that fill these roles play a critical part in many of manufacturing engineering businesses. Alongside recruitment there is also a clear and present need to up-skill organisations’ existing staff, as experienced staff retire or are poached by competition from companies in Europe, the US and emerging economies as well as by other often more attractive careers in knowledge and service-based industries.
Productivity is very important for the UK with a greater focus on rebalancing the economy. However, the Leitch Review of Skills in 2006 highlighted that the average French worker produces 20% more per hour, German worker 13% more and US worker 18% more than the average UK worker.
One fifth of this productivity gap is a consequence of the UK’s comparatively poor investment in training. UK manufacturers spend about 60% less on training than comparable Western nations.
Up-skilling machine operators to be able to diagnose faults and repair machines at the source may seem like an easy route to higher productivity.
But obtaining better results is not as simple as investing in technical training. The UK has researched skills gaps in industry since 1867, and the findings have consistently highlighted the same problem.
Technology moves fast but technical training can run alongside new machines, so this is not the issue. Rather it is management and leadership skills which are lacking.
There is an inability to engage people in the need and desire to upskill themselves.
This was seen in a recent workshop Festo conducted with one manufacturer. Engineers were placed on a course to improve their faultfinding skills. Instead of being pleased to be developed, they responded with the feeling: “Bloody management, they never look after us.” This ‘allergic reaction to change’ emerges when management is perceived to have changed the goal posts of a job without explanation or consultation. From an employee’s perspective responsibility has been increased without any perceivable reward. Managers need to adapt their style to embrace the attributes of leadership and coaching. To succeed, leaders need to influence three dimensions of their employees:
• Head: are they able to explain what the change is and why it is necessary?
• Heart: are they able to relate the change to the individual; can they empathise with their situation and inspire them to support the change?
• Hand: do they have the skills to guide, support and coach individuals through the change?
It is the responsibility of manufacturing leaders at CEO and managing director level to ensure they create an environment where this kind of management is enabled.
For some, this will mean a significant change to the issues they have traditionally considered to be leadership concerns.
Festo Training and Consulting is a subsidiary of Festo, a specialist manufacturer of pneumatic and electric drive technology. Festo has taken on the role of Official Supplier to WorldSkills London 2011 for the mechatronics, mobile robotics and polymechanics categories.