Main » Labour market challenges, stay on the sunny side of the street

Many companies experience shortages on the labour market (manufacturing, logistics sectors, but other as well). High employee turnover, difficult recruitment process.

Temporarily you may handle this with overtime but does not work in a longer term. Market opened up for economic migrants, it helps, but I would not expect the trend will change and companies will enjoy employer’s market in a foreseeable future.

It is a new business reality, you better consider it to stay. As such, ability to manage it, becomes just one more competitive advantage factor. It is one more know-how you need to build in the organization. The similar approach as for building a brand, distribution channels, perfecting a technology. You need a plan coherent to you vision, goals and culture.

The needs are easy to understand across the organization and you may align wide groups along these goals. What is even more important, your activities will result in sustainable improvements and re-design, so you do not face the dilemma of the compromising with long term objectives.

Sounds promising. Combine soft and process programs and succeed.

The example of the systematic approach may be as follows:

Recruit

Monitor closely frequently local trends and offers of your competition for critical positions.

Monitor and follow local offers, search for details to understand well all components, you offer needs to be competitive, but you do not want to go overboard.

Hit the labour market with customized channels.

Each targeted group has its own scheme of contact with employers offers. Learn it. Use internal employees’ recommendations, invest in employer brand in the region.

Retention

Reinforce the business culture components that makes your company attractive.

Social benefits - copy from others but stay pragmatic, it may cost much. Be creative, flexible hours, home office, training etc. Help people to like the place. Positive atmosphere, respect, integrity, personal development - sky is the limit. It pays off much quicker than you may think.

Reduce the internal cost of the higher turnover.

Quick and low cost for the new employee on-boarding

The turnover will be higher, you need to accept it. Minimise the cost of the on-boarding. Smart induction training, clear SOPs, elevate Visual Factory and 5S concepts to the new level.

On the top of that process programs.

Improve the pipeline

Ergonomics

Improvements in ergonomics will reduce turnover, help in retention may positively impact safety, quality and productivity. In addition, open the positions for new groups of the employees. Make working area safer, nicer, friendlier and wider pool of candidates may be interested in those positions. Open you space for 55+, women, temps, you name it.

Upgrade the offer, pay more

Increase the value of the position by higher performance.

Pay more get more. Put in place CI programs, make it a part of the core scope of the responsibilities. Combine various methodology and create your own Lean, but make it lean and make it yours. You may incorporate monetary award scheme for higher performance, but do not overestimate it, long term may have adverse impact.

Upgrade the value of the position by process re-design.

Pay more but modify the scope of the job. Add value-added activity. Even low-skilled or semi-skilled persons may contribute to quality assurance, audits, incoming materials check, logistics, material handling support. There are more possibilities than you may think. Allow teams discover them. What is equally important put in place a practice to eliminate and reduce activities that are of less importance or less priority. That exercise itself builds new competitive advantage, as simplifying procedures or eliminate lower priorities is not a common practice across the organizations.

Reduce the demand

Reduce labour intensity by minor but massive improvements and continuous semi-automation program.

Big automations, breakthrough projects are always on the radar screen of the management boards, but do not happen every year and cannot be an excuse for not doing minor/medium improvements and continuous semi-automation. Include and involve wide group of people across the organization (supervisors, operators, engineering team, technology team, quality, shop floor crew, you name it) for micro projects. Make it a routine activity and monitor progress monthly. Tangible benefits come quickly. Sometimes reverse logic may help, instead of automation of existing operations use available automation solutions and redesign the process to utilize them.

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With comprehensive approach and systematic, structured programs you cannot fail to address labour market challenges. Success guaranteed, but that road map hates shortcuts and appreciates some patience.