In a webinar entitled “The Art of Possible: Manufacturing Priorities that Will Define 2021,” Çağlayan Arkan, Microsoft’s VP of manufacturing industry shared: “From extreme disruption comes extreme transformation.”
His point is well taken. In the aftermath of the pandemic, supply chain has raced to the top of the news and manufacturing is centerstage. Arkan followed up his comment with a quote by Microsoft CEO Satya Nadella: “We have seen two years’ worth of digital transformation in the matter of two months.” AI has been a major force in accelerating progress and expanding the opportunity for greater inclusion among the manufacturing workforce.
The need is more urgent now than ever before. Arkan’s special guest, Enno de Boer from McKinsey & Co., outlined what will remain as remnants of the ongoing uncertainty and disruption. We are most likely never going to return to “normal,” however there is a positive story ahead:
- Agile, customer-centric supply chains
- A more resilient supply chain ready to handle the disruptions ahead
- Greater productivity and speed as a response to rising economic pressure
- A focus on sustainability as we explore systems with greater efficient
Rethinking Workforce Solutions
As we continue to shape the fourth industrial revolution, otherwise known as Industry 4.0, I believe we have an unbelievable story to explore with our workforce. Workforce development is closely tied to digital transformation, an undisputed requirement for a global supply chain, competitive edge, capacity building, time savings, cost containment, customer experience and capitalizing on the steep growth of emerging markets over the next decade.
According to an article in Assembly Magazine, author Zoe Leduc writes: “The most significant way a company can optimize the workforce is to build on their talent with training and skill development.”
This means all members of our workforce. The pandemic has become a wake-up call for digital transformation to create positive change. It is time to ready ourselves for the future and help our workforce thrive. But how?
Getting People Ready for the New Jobs Ahead
Don’t buy into the myth. People have always been both enthralled and intimidated by new ideas. It’s human to feel threatened by change. Thus, the myth perpetuates that automation will replace humans and lead to job loss.
Terry Gregory of the Institute of Labor Economics (IZA) disagrees. He says, in a 2019 article published by digital news magazine Worldcrunch that “automation has brought Europe an additional 1.5 million jobs in the past decade.” One basic premise is that automation allows manufacturers to produce goods with less expense, increasing demand and creating more jobs.
Reassess operating procedures and priorities. We know safety is a given. We know supply chain management is a must-have. But what about other operating procedures and priorities within your organization? What part of automation can be automated in the long term? How has the business imperatives evolved in the wake of so much change?
For example, 20 years ago, food manufacturers primarily invested in operations to handle capacity and launch new products. Today, many are using external manufacturing to meet demand. How has your industry changed? How has your organization’s vision changed?
Stay current with technology. The value of data and the ability to turn data into actionable insights using tools like Power BI is an opportunity that did not exist even 10 years ago. Low code and no code solutions mean you don’t need to be a data scientist in order to understand the story behind information. Manufacturers that stay current with technology have far less chance of falling behind.
Retrain your workforce around digital transformation and innovation. In one-on-one interviews with team members, assess their skills. What are the top five skills each person can learn? What are their interests? What are their goals? Where can they contribute to the innovation side of your manufacturing company?
Data mining, data analytics, IoT, AI fueled by data, mixed reality and context, intelligent cloud, hybrid cloud, and planning the factories of the future are all examples of skills that are not only possible, but fascinating to learn. As collaborative robots, robots and automation handle the mundane, undesirable or repetitive motion tasks, what new skills might people learn in the era of Industry 4.0? As workers reskill, they redirect their focus around human-centered skills that fuel innovation, problem-solving and the customer experience. Also, if part of manufacturing’s ongoing labor shortage is attracting talent and debunking the myth of the assembly line worker in a dirty factory, how might technology entice more people to get excited about a career in manufacturing?
De Boer points out that reskilling operators leads to safer and more productive work environments. It also allows them to concentrate on the work they do best, eliminating repetitive, boring tasks. Interestingly, he pointed out that he has talked to many people on the plant floor who are excited about these technological leaps.
Digital transformation ultimately leads to making customers more successful. All roads lead to an elevated customer experience, an aspect of business that some studies indicate will eventually out distance price and product.
The Story of Clover Imaging Group
We’ve seen technology’s transformative power in the wake of the pandemic make tremendous strides with companies like Chicago-based Clover Imaging Group. The largest collector and re-manufacturer of printer cartridges in the world, Clover used Microsoft’s Azure technology to empower warehousing employees with cognitive disabilities through conversational AI and a mixed-reality platform that acts as a “virtual guide . . . to performing a job and a series of tasks that they might not otherwise be able to complete on their own,” according to a news story in business journal “Wisconsin Inno.”
The result: more satisfied customers who appreciated increased fill rates, a significant reduction in backorders and shorter lead times.
Azure’s machine learning capabilities enhanced Clover’s company-wide digital transformation initiative and provided the company with data that uncovered major inefficiencies in inventory, transportation and distribution sectors. For example, at the company’s distribution centers, Azure’s machine learning and data analysis capabilities help minimize order assembly by determining what products and how much to stock in each warehouse and where best to stock products within the warehouse. Thanks to the technology, processing teams nearly tripled their efficiency.
Clover saves, on average, $15,000 per month as Azure helped eliminate seven MS exchange servers, six Skype servers, nine file-shares, and more than 25 domain controllers.
“We are excited to have driven key global skilling initiatives to address the widening skill gap, in the era of data and AI. Grounded in partnership and collaboration across industry, government and academia, we have been able to bring about impactful outcomes with our manufacturing partners and customers,” commented Walid Ali, a thought leader in AI and digital transformation at Microsoft.
In 2019, Microsoft hosted a webinar featured Carolyn Lee, executive director of the Manufacturing Institute, the country’s largest industrial trade association. Lee explored the compelling workforce need among manufacturers, pointing out that between 2018 and 2028, the manufacturing sector will have to fill 4.6 million jobs due to baby boomer retirement and economic growth. According to a joint study by Deloitte and the Manufacturing Institute, 2.4 million of those jobs may go unfilled due to a lack of skilled workers.
For manufacturers, the future is less about hiring data scientists and programmers and more about creating an environment to upskill a workforce capable of managing the new demands of work while leveraging the power of technology to support efficiency, open up more space for innovation and fuel growth.
When we align around a common purpose, we become invincible. As manufacturers, technology providers like Microsoft, supply chain partners and customers come together to collaborate in solving problems, we become a force for positivity and real solutions.
What if every person in manufacturing could learn one new skill in the next six to 12 months? That would be an enduring story for the art of possible.
Helen Yu is founder and CEO of Tigon Advisory, a CXO-as-a-Service growth accelerator. She has led multibillion-dollar revenue growth for Fortune 500 enterprises, including Oracle, Adobe and Marketo. She was dubbed a Top 10 Global Influencer in Digital Transformation by IBM and a Global Top 10 Thought Leader in AI by Thinkers360.