Personnel Stability? Print E-mail
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Written by Peter Grundy   
Friday, 31 October 2008 19:00

We in the know must leverage the tools available to use change to our advantage.

Better Manufacturing One is tempted to assume the slowdown in housing starts means all construction industries are afflicted. While those builders that concentrate on homes are, indeed, having a horrible time, others either avoid the housing market altogether or include it as a controlled part of their portfolios. These companies seem to be seeing stability. News broadcasts show dramatic coverage of unfinished houses and abandoned building sites, but rarely show the massive amounts of construction taking place on railways, airports, canals, power stations and so on. Demand is high for nuclear physicists, geophysicists, rail engineering specialists, and other specialties. In addition, there is demand for laborers and lesser-experienced specialists. While infrastructure work is always a part of the landscape, attention tends to center on the environmental impact associated with any large-scale projects. Renewable energy sources (wind, hydroelectric, solar, etc.) attract massive coverage when virgin land is needed or communities are moved, yet generate scant attention when greed in high places goes unchecked. It is undoubtedly correct to monitor and criticize industrial activity, but it is also correct to monitor and criticize excess wherever it occurs.

One of the reasons for the rapid peaking and troughing of economies is the amazing speed with which information flows around the world. Communications are so fast, an event becomes world news almost as soon as it happens. Those of us in the electronics and telecom worlds are entirely to blame. We have not learned to use this available speed to warn of impending change more vigorously and then use it to our advantage to plan effectively. The culture is “This is making money so I’ll continue as long as I can before there is trouble and then blame someone else when it goes wrong.” We need a culture that emphasizes long-term strategies. Banks and investment groups usually look for quick returns on investment, oftentimes failing to give the borrower time to plan an effective strategy and fund it to where it is stable and growing steadily. Some things fail because they were idealistic attempts that never would have worked in the long-term. Yet there are also ideas that need long gestation periods or continual investment. The latter should be made immune to peaks and troughs.

Industry’s immediate reaction to troughs is to scrimp, which in turn has an effect on long-term strategies. All companies react in different ways, but it is noticeable that most first trim training, marketing and HR services. It’s probably safe to say anything considered non-value-added to a product is a prime target for cuts. It is easy to see why CFOs prioritize this way, but this may be to the detriment of long-term growth and stability.

All people can offer something to society. Some are destined for power and leadership; some are healers and so on, but there is a strata of needs covering degreed education to manual labor that gets distorted by a desire by some governments to insist everyone must have higher level schooling. The original concept of a degree was to allow those who really wanted to stretch their minds to be put in a position where they could achieve this. If everyone is degree-educated, the result is unattainable expectations and not enough variety of ability.

Apprenticeships were usually owned and controlled by an employer that could advise an apprentice how to best use their abilities. In some cases this would lead to a degree, in some cases not, but the balance of talent available permitted continuous company growth (until long-term development strategies became difficult to fund because of economic instability).

I do not propose to rejuvenate apprenticeships as they once were, but rather assert properly constructed training programs can stimulate competition in global markets. We know low-cost labor regions attract manufacturing, but it is also true labor usually makes up only a fraction of the total cost of manufacture. Highly automated production facilities can be set up anywhere there are sufficient numbers of skilled people to look after the lines, and automation provides consistency and high quality (provided it is specified properly). Thus, it is possible for industrial societies to compete no matter where they are based.

The old structure of skilled manual labor, production controllers and so on probably does not apply to highly automated systems; that is where we need to maintain the optimum balance of skills. We need quality, degree-educated engineers and scientists, as always, but established industrial societies now need fewer manual laborers than we did 50 years ago. However, we still need the balance of skills, and calling for 100% degree education is not the answer.

Steady growth in a stable environment may not be flashy, but it permits long-term strategies to be put in place and the planning of change to make true progress occur. Stability is the key to our future.

Peter Grundy is director of P G Engineering (Sussex) Ltd. and ITM Consulting (itmconsulting.org); This e-mail address is being protected from spambots. You need JavaScript enabled to view it . His column appears bimonthly.

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