In an era of ever-evolving technology and increasingly complex manufacturing processes, the skills gap in the manufacturing sector has become a pressing concern. Finding and retaining qualified talent for specialised tasks can be a daunting challenge for manufacturers, often leading to delays, increased costs, and compromised quality. However, a promising solution was recently discussed at this week's Made in the Midlands monthly industry meet-up: outsourcing specific manufacturing processes to specialised organisations. This was the message made by Tony Hague, CEO of PP Electrical Control & Automation in Cheslyn Hay, who expertly led our keynote prior to the round table on this topic, In this round table, we explored the advantages of this approach and outline a roadmap for its implementation with Made in Group Members; Tony Hague of PP Electrical Control & Automation Stephen Crow of Clarion Solicitors, Carl Hollier of Industrial Washing Machines, Caroline Findlay of LG David, Alex Podesta of Central Fasteners, Cherelle Jones of Partners Group, Pete Robinson of In-Comm Training and Mark Roberts of Hucknall Sheet Metal.
In a concerning backdrop to this topic, despite less than 4% unemployment, 600,000 economically inactive have been added to the employment shortage since the pandemic - where fewer people are offering their labour to the market, it limits the wider economic opportunity for growth as there are simple fewer people available to work.
The Skills Gap Challenge
Manufacturers across various industries are grappling with a shortage of skilled workers. Whether it's CNC machining, welding, or advanced quality control, finding individuals with the right expertise can be a significant hurdle. Many manufacturers are hesitant to invest in extensive training programs or take on the burden of hiring and retaining specialised talent due to the associated costs and risks. This has happened faster in some industries than others, Stephen Crow of Clarion Solicitors pointed out the UK Textiles industry has been consciously outsourcing labour around the world for more than 100 years, where much of the I.P and skills have been now lost, but some is slowly coming back, through what we're seeing in the circular economy.
The Outsourcing Solution:
Outsourcing specific manufacturing processes to specialised organisations can be a game-changer for manufacturers facing the skills gap challenge. Here are some compelling advantages of this approach:
Expertise and Specialisation:
Outsourcing companies often specialise in particular manufacturing processes. They have a team of experts who are well-trained and experienced in handling these tasks. By partnering with such organisations, manufacturers can tap into a pool of specialised knowledge and skills that might otherwise be challenging to acquire in-house.
Building an in-house team of skilled workers can be expensive. Outsourcing allows manufacturers to avoid the costs associated with recruitment, training, salaries, and benefits for specialised employees. Instead, they pay for the specific services they need when they need them, making it a cost-effective solution. This is an area of expertise for In-Comm Training who's new cohort of 75 learners starts next week as manufacturers are sending engineers of all ages to In-Comm - not just apprentices to lower their own training costs.
Reduced HR Burden:
Outsourcing eliminates the need for manufacturers to manage the human resource liabilities that come with hiring specialised talent. This includes handling recruitment, employee retention, performance evaluations, and compliance with labor laws. Manufacturers can focus on their core operations while outsourcing partners handle the rest.
Scalability and Flexibility:
Manufacturing demands can fluctuate, making it challenging to maintain a consistent workforce. Outsourcing offers scalability and flexibility. Manufacturers can scale up or down their outsourcing arrangements as needed, ensuring they have the right resources at the right time.
Specialised outsourcing partners often have rigorous quality control processes in place. This can lead to improved product quality and consistency, ultimately benefiting the manufacturer's reputation and customer satisfaction.
Roadmap to Implementation
Implementing outsourcing as a strategy to address the skills gap in manufacturing requires careful planning and execution. Here's a roadmap to get started:
Identify Critical Processes:
Begin by identifying the specific manufacturing processes that are causing skill-related challenges. These could be tasks that require a high level of expertise, are time-sensitive, or have a significant impact on product quality.
Research and Select Outsourcing Partners:
Research and identify outsourcing partners with a strong track record in the identified processes. Look for companies with a history of delivering quality work and a commitment to continuous improvement.
Define Scope and Objectives:
Clearly define the scope of work and objectives for the outsourcing partnership. Establish key performance indicators (KPIs) to measure success and ensure alignment between your goals and the outsourcing partner's capabilities.
Legal and Contractual Agreements:
Consult with legal experts to draft robust contracts that clearly outline roles, responsibilities, pricing structures, and expectations. Ensure that all legal and compliance aspects are addressed, this was an area well covered by Clarion Solicitors.
Integration and Collaboration:
Foster open communication and collaboration between your in-house team and the outsourcing partner. This ensures a smooth transition and ongoing success
Monitoring and Evaluation:
Regularly monitor the performance of your outsourcing partner against established KPIs. Use this data to make informed decisions and adjustments as needed.
The skills gap in manufacturing is a significant challenge, but it's not insurmountable. By embracing the power of outsourcing, manufacturers can leverage the expertise and capabilities of specialised organisations to bridge the gap. This strategy offers cost savings, reduced HR burdens, and access to high-quality work. With a well-planned roadmap for implementation, manufacturers can navigate the changing landscape of manufacturing with confidence and success. The main takeaways offered by members were; Keep it local when using this service!