March 4, 2014 / employee incentives, human capital, optimization, training
For the last several years, most metals companies have been investing in technology to improve productivity. And as the industry tries to deal with the skills gap, that trend will likely continue. In fact, a report from Fabricating & Metalworking expects 2014 to be the year of “unprecedented automation.”
However, industry leaders also realize that automation isn’t going to be the panacea for their workforce challenges, nor is it the only way they can optimize their operations. A growing number of manufacturers are finding that plant floor workers can play just as much of a role in improving efficiency and, if leveraged correctly, can be more of an asset than a cost.
According to this article in The New York Times, a few years ago, motorcycle manufacturer Harley completely redesigned its production system around this concept. The company built a brand new plant, but instead of relying on robots to ramp up productivity, the well-known brand put its value in its workers and the problem-solving skills they brought to the table.
Of course, Harley is a custom, unionized shop. Can the same hold true in a high-production metal-cutting environment? A recent column from IndustryWeek says yes. As evidenced in the winners of its Best Plants Award, IW says that leading manufacturers—both union and non-union—are investing in their plant floor production staffs and are seeing positive bottom-line results.
Here are a few metals companies that also finding that to be the case:
- Yarde Metals, a metal service center based in Southington, CT, has found that employee incentives can pay off. According to a case study from the LENOX Institute of Technology, Yarde has instituted a bonus system that provides operators with financial compensation when the company does well. To keep operators up to date on performance, managers post daily scorecards next to the time clock that lists productivity stats and other key operation metrics. Greg Sioch, lead foreman of the facility’s plate department, says the system has been very successful and that operators are used to getting bonuses. “Everybody knows that if you don’t send out a good product, you are going to be held accountable for it and it is going to ultimately affect the bottom line for everybody,” Sioch said.
- According to the Modern Metals 12th Annual Consuming Industries Survey, several fabricators, service centers, and metals OEMs are investing in internal training and education programs to combat the growing void of qualified workers. Safety, forklift, first aid, lean manufacturing, and operational training are just some of the programs being offered. In the article, “A Mixed Bag,” the magazine quotes one fabricator as saying that it plans to hire unskilled labor at lower rates and increase their pay as they learn skills. Another fabricator tells MM that it pays for any education relating to the metal industry and that it also offers apprenticeship programs.
To succeed in today’s competitive market, metalworking executives need to optimize all aspects of their operations—and that includes their human capital. Whether it’s incentivizing employees to keep quality high, leveraging their problem-solving skills to improve productivity, or providing them with the training to acquire the skills required in today’s automated plant, it pays to value your operators. Like Harley, metals companies have a choice: They can either treat their plant floor operators as costs, or they can turn them into valuable assets.