Factories of today would be wholly unrecognizable to those working in manufacturing 100 years ago. Human labor is no longer the only fuel added to fire up the engines of productivity. With increasing levels of product sophistication and plant automation, technology has gained the pivotal role in determining output in the enterprise. Consequently, IT systems have taken a critical role to enable operational excellence.

With the rise in importance of these systems comes a requirement for employees who can manage and improve how these systems operate. Manufacturers now face huge challenges sourcing qualified and ever more skilled workers to make the most of it. The question now facing many business leaders is how to cope with a skills shortage in a more specialist, competitive and performance driven environment?

Addressing the Skills Shortage on the Shop Floor

If you were to look at the job description for a shop-floor job in a plant, prospects should expect to see a desire for a deep knowledge of manufacturing and technology. In a high-tech environment, the demand for highly qualified manufacturing employees is becoming increasingly acute. In the long-term, businesses are looking to invest and take advantage of university courses to encourage skilled individuals to explore this avenue. But we live in the short-run. Business cannot wait for a new generation of skilled workers.

Across the manufacturing ecosystem, technology is responsible for driving down costs while improving quality and operational efficiency. The employee in the factory of the future will require many skills – from IT system usage and support to scheduling, collaboration, multi-tasking, and communications excellence. More importantly, employers will need to better allocate these skills across various cultures, geographies, suppliers and peers.

Given this problem won’t go away overnight, what is the short-term solution? Manufacturing as we know it today is truly undergoing a transformation. In the short-term, employees and employers must learn to do more with less.

Establishing a Center of Excellence as a Solution

One strategy that is paying a strong return on investment is the concept of a “Center of Excellence” or COE. First, let me provide a definition. When I refer to a COE, I am including both the team that comprises the staff to run it, as well as the IT infrastructure necessary to enable efficient management of the processes that are being managed by that team.

A best-in-class approach is to concentrate your company’s best subject matter experts – each well skilled in manufacturing, logistics, quality, maintenance, or engineering – into one “core” group. This “A-Team” can then work together in a centralized location to identify and define operational best practices. With the support of the right IT infrastructure, COEs can help define the overall operating structure, identify and tap the right resources to address challenges, and help employees stay focused on a common business goal.

5 Benefits of a COE Strategy

Leading manufacturers such as Cummins and L’Oréal have adopted a COE strategy and have found several key benefits, including:

1. Greater opportunity for process improvement – The group of skilled workers with a greater level of training, teamwork, and empowerment will be better able to influence and maximize operational efficiency and process improvements quickly, on a global scale.
2. Better visibility across the enterprise to improve efficiency – A COE allows for consistent measurement of output, standard metrics and efficiency from a common viewpoint.
3. Incentivize “bottom up” process improvement – The staff actually performing a process often has greater understanding of where future performance improvements can be extracted, when compared to corporate-led process-improvement mandates. A COE is an ideal way to establish a bridge to better connect these groups, which can then lead to better evaluation and sharing of process improvements as best practices.
4. Knowledge sharing – A COE framework allows for suggestions from the shop floor to be heard, acted upon and rolled out across the entire organization.
5. Improved training effectiveness – A COE is an ideal way to collect, store, and document knowledge and best practices, which can then be retrieved to better, more consistently train new employees.

The status quo of an increased shortage of skilled factory workers is not going away soon. The decision to embrace a COE approach is a highly effective way to leverage the shrinking pool of labor resources tasked with greater responsibility, and to ensure higher operational efficiency and uptime on a smaller budget.

The factory of the future will, without a doubt, need to be people-driven. Successful manufacturers must invest in skilled labor, advanced IT, and new automation systems to support an increasingly complex production line. Those manufacturing organizations that best leverage their scarce, highly skilled workforce will ultimately achieve greater market share and profits – becoming the new leaders of tomorrow. Do you have a COE? If so, how has this strategy worked for you? I would be interested to read your feedback below.

If you liked this article, here are others you might also find interesting:

• How a Center of Excellence Can Become an Engine for Continuous Improvement
• Leverage People, Processes & Technology to Achieve Operational Excellence
• A New Model for Manufacturing Innovation