skills gap

How Forges Can Attract Millennial Operators

January 25, 2015 / , , , , , , , , ,

As more and more Baby Boomers near retirement, many forges are faced with the challenge of replacing the lion’s share of their workforce, including senior management. Unfortunately, a lot of workers that should be the natural replacement—Generation X—never really took an interest in manufacturing, so many companies are now looking to Millennials to fill the gap.

But how do you make a career in manufacturing attractive to an entirely new generation? The literal generational gap between Baby Boomers and Millennials means that today’s manufacturing companies need to get creative and even more so, be flexible, when seeking out new talent.

As this guest editorial from Forward magazine explains, Millennial attitudes and behaviors are vastly different from those of the previous two generations. The author, Neil Howe of LifeCourse Associates, provides a few attitudes and behaviors that define Millennials:

The good news is manufacturers can leverage some of these traits to their advantage. For example, being “team-oriented” is ideal for any operation looking to implement (or has already implemented) lean manufacturing principles. In fact, many of these characteristics point to one overarching theme: Millennials want to be engaged. They want to be acknowledged, active participants in their jobs.

Here’s the bad news: Even with the lean movement, this isn’t the manufacturing industry’s strong point. According to this article from IndustryWeek, a Gallup poll showed that when looking at engagement among different occupations, “manufacturing came dead last, with just 24% of production workers rated as engaged.” That is below both clerical workers and government workers. Why the low rating? Gallup said the problem might be that “the management culture in these companies tends to focus on process ahead of people.”

Back to some good news: The talent gap presents the perfect opportunity for managers to start creating an engaged work environment, both for Millennials and current employees. Using suggestions from the IndustryWeek article, here are a few ways managers can do just that:

Perhaps the best news is that the Forging Foundation (FIERF) and the Forging Industry Association (FIA) are already working on multiple fronts to help reach out to the next generation’s workforce. According to this article from Forge magazine, the two organizations are teaming up with both academia and industry to tell the forging story and to provide resources to assist in their recruiting and retention efforts. For example, FIA is currently offering members “Forge Your Future Toolkits,” which include an array of ideas and resources for forges trying to develop relationships with teachers and students with the goal of becoming an “employer of choice” in the local community. (Click here for more information.)

Clearly, gearing up for a new generation of workers will take time, combined efforts, and in most cases, some change. But like any area of your operation, hiring and maintaining talent requires continuous improvement—or at least it should. The future of your operation may just depend on it.

skills gap

Preparing Your Metal Service Center for the Next Generation

December 5, 2014 / , , , , , , ,

Metal service centers, just like every other segment of the manufacturing industry, are facing a huge challenge that is only going to intensify in the years to come. That challenge is the skills gap, and if you aren’t facing this issue head on just yet, you will be soon.

As stated in a previous blog post, skilled production workers are one of the largest workforce segments facing retirement in the near future, which will have an impact on the number of experienced workers on the shop floor. Meanwhile, the next generation of workers just isn’t interested in pursuing manufacturing careers. Large corporations like GE are trying to change that, but shifting cultural perception isn’t something that happens overnight. This is leaving manufacturers with a small pool of talent from which to choose.

Many experts believe that actively attacking the skills gap will require managers to adjust the ways they both hire and maintain talent. While larger company goals and expectations should never be compromised, part of the solution will be for your service center to adapt to a new generation of operators. In other words, it will serve you better to embrace—not fight—the generational traits of Millennial workers, which includes taking into account their upbringing, their strengths, and their weaknesses.

What are some of these traits? In a recent article published in Forward magazine, Neil Howe, president of consulting firm LifeCourse Associates, provides a few attitudes and behaviors that define Millennials:

According to Howe, companies need to re-brand their operations with these tendencies in mind if they want to attract a new generation of operators. For example, Howe says managers should focus on creating teamwork-oriented activities—a tactic that fits well within the premise of lean manufacturing. “Give Millennials shared responsibilities, the chance to learn from peers, and let them collaborate on design and production work,” Howe suggests.

These types of strategies, combined with community efforts such as plant tours and working with local universities, will not only help your service center close the skills gap, but just as importantly, prepare you for a next-generation of customers as well.

skills gap

Metal Cutting Experts Discuss What it Takes to Stay Competitive

August 28, 2014 / , , , , , , , , , ,

With this year’s International Manufacturing Technology Show (IMTS) just wrapping up, investment decisions about production equipment and technology are at the forefront of just about every manager’s mind. While unstable market conditions make it tempting for companies to keep their dollars close, demands for faster delivery and a shortage of skilled workers are making it hard for most metal-cutting companies to keep up without some capital investments.

For many companies, those investments will be in equipment and tooling. According to the 2014 Metalworking Capital Spending Survey by Gardner Research, U.S. metalworking facilities will spend $7.442 billion, an increase of almost 19%, on new metal-cutting equipment in 2015. The same report forecasts that tool sales will be at their highest level in more than a decade.

Another report from market researcher IBIS states that “private investment in metalworking machinery has been improving and demand has been steady.” IBIS also predicts continued growth over the next few years due to renewed demand from machine shops and an upturn in automobile sales.

Meanwhile, experts are saying that managers need to start spending more time and money on their human capital. As this white paper from the LENOX Institute of Technology (LIT) discusses, today’s metalworking executives need to optimize every aspect of their operation. While it is easy to rely heavily on equipment and tooling to improve efficiency, more and more companies are finding that it is just as important to account for—and correct—the human variables that can contribute to productivity. This could include everything from working with colleges to secure new talent to instituting ongoing training and incentive programs.

To help companies get a bigger picture perspective on where they should put their money, LIT asked two industry experts to share their thoughts on industry trends, the benefits of technology, and what they think it will take for metal-cutting companies to stay competitive. Read as Don Armstrong, national accounts manager at Marvel Manufacturing Company, Inc., and Rick Arcaro, vice president of Sales & Marketing at Hydmech, weigh in.

What technology advancements have helped metal-cutting companies address the challenges they face in today’s marketplace?

Armstrong: I think the problem of how to increase productivity without adding personnel has been greatly helped by the amount of automation that is available in today’s machine tools. In addition, the advances in cutting tools have given our customers the ability to process more product with fewer machines. The concern over the availability of skilled workers has been offset to some extent by user-friendly controls, preprogrammed settings, and the ability to network machines.

Arcaro: New machines and blades have improved productivity and lowered cost per cut, and simple controllers have allowed companies to hire a lower skill level of operator to run them. Machines that are simple to maintain with the availability of parts off-the-shelf when needed have also helped customers get parts out the door faster with lower processing costs.

How have these advancements contributed to the bottom line?

Armstrong: The highest cost for any business is generally people, i.e. salaries and benefits, so whenever you can increase productivity without increasing your workforce, the bottom line will benefit.

Arcaro: Companies that have adopted continuous improvement management have reduced processing bottlenecks, kept their operations and workers as efficient as possible, while lowering operation costs and increasing the bottom line.

What is one up-and-coming advancement that industrial metal-cutting companies should know about or should consider as today’s market evolves?

Armstrong: I think a trend that metal-cutting companies should keep an eye on is the increasing use of composites and other materials in areas where metal was once used.  This trend has been most noticeable in the automotive and aerospace industries.

Arcaro: Service centers need to continue to invest in value-added processing. Several factors are fueling investment in new equipment today: automation and computerized controls that make the latest machinery much more efficient, productive, easy to service, and user friendly. Companies should also look for machines and technologies that will extend tool life and reduce tool-change downtime.

What practical tip would you give an industrial metal-cutting company trying to compete in today’s marketplace?

Armstrong: I would advise them to build on their most valuable asset, their employees, by emphasizing training and ongoing education. I would encourage employees at all levels to get to know their customers in order to better understand their needs and help provide solutions for them. And, finally, I would remind them to look beyond traditional manufacturing processes for new ways to apply the knowledge that they have gained in metal cutting.

Arcaro: Knowing your place and position in the market is key. Trying to be good at everything is impossible—be great and profitable at something.

skills gap

How Forges Can Fill the Skills Gap

August 25, 2014 / , , , , , , , , ,

Forges, just like every other segment of the manufacturing industry, are facing a huge challenge that is only going to intensify in the years to come. That challenge is the skills gap, and if you aren’t facing this issue head on just yet, you will be soon.

As stated in a previous blog post, most manufacturers are trying to address two key gaps. First, skilled production workers are one of the largest workforce segments facing retirement in the near future, which will have an impact on the number of experienced workers on the shop floor. Meanwhile, the current talent pool isn’t what is should be. Streamlined production lines and more process automation have changed the nature of manufacturing work, and the incoming generation of workers lacks the skills and technical knowledge required.

As far as the forging industry is concerned, this issue is already affecting most of your peers, according to Forging magazine’s 2014 Business Outlook. When the magazine asked its readers what would have the greatest impact on the future of the forging industry, a little more than half said the “availability of qualified workers.”

However, don’t be discouraged. An article from the Economic Policy Institute argues that most of the skills required of your operators are well within the reach of most people. In other words, the talent is out there; you just need to find, train, and maintain them. The following are a few tips for doing just that:

skills gap

New Trends Affecting Industrial Metal Cutting

July 28, 2014 / , , , , , , ,

There is no question: Lean manufacturing has forever changed the way the world makes products. However, as the market changes and demands shift, the manufacturing industry is starting to embrace strategies that either challenge or go beyond traditional “lean” principles.

And, really, that is what leaders should be doing. The world is much different than it was 25+ years ago, when manufacturers first starting implementing Toyota’s lean strategies. In industrial metal cutting, for example, the ultimate goal will always be to move more metal, but as this white paper from the LENOX Institute of Technology suggests, global competition, talent shortages, and an unstable market have created a whole new set of challenges that a simple lean tool won’t be able to fix.

Today’s market requires leaders to keep a pulse on “what’s next” so they can create innovative, strategic solutions that balance internal efficiency with external demands. Below are just a few leading-edge trends we found that are stretching the traditional notions of best-in-class manufacturing. Not all of these strategies will be directly applicable to every metal-cutting organization, but they certainly provide new perspectives and alternative approaches that could just change manufacturing as we currently know it.

skills gap

Empowering Operators in Your Metal Service Center

July 5, 2014 / , , , , , , , ,

Too many manufacturing executives underestimate the power of investing in their operators. As this 2012 study from PwC confirms, metal executives have traditionally preferred to invest more in technology than in their talent. However, that is slowly changing.

While the idea of empowering employees sounds a bit cliché, a growing number of managers are finding that operators who take ownership of their process or work area are truly invaluable. Employee “buy-in” can positively affect all aspects of an industrial metal-cutting operation, including quality, productivity, and in the end, the bottom line. Similarly, when employees don’t “buy-in” or feel disconnected, those same business areas can be negatively affected. High turnover is both expensive and time consuming, especially in light of the current skills gap. Finding, training, and maintaining talent are some of the biggest challenges facing today’s service centers, not to mention the manufacturing industry at large.

As this article from Reliable Plant points out, employee engagement is a complex, two-way process. “Companies must engage employees in their principles, programs and policies, and encourage them to respond through participation,” the article says, adding that this creates “loyalty, pride and a sense of identity and community.” This may start with basic actions like creating a safe and enjoyable workplace for operators, as well as more appealing incentives such as continuing education and bonuses. But it shouldn’t stop there. Investment needs to go both ways. In fact, according to Forbes, part of the goal should actually be to keep employees dissatisfied:

“Dissatisfied employees are actually more likely to deliver higher performance.  I don’t mean dissatisfied with their job, their company or their boss, but dissatisfied with their own performance, their team’s performance and their company’s performance.  One of the most important jobs of the mid-market CEO is to create an environment in which the team is dissatisfied with the current state of things and are striving to become more satisfied.” (Forbes, “Why You Need Dissatisfied Employees, 08/03/2012)

So how to do get your operators to be both (dis)satisfied and invested?  Below are a few best practices and resources that may help answer that million-dollar question:


skills gap

How Fabricators Can Identify Skills Gaps

May 10, 2014 / , , , , , , , , , ,

There is no question that the skills gap is one of the most pressing issues for industrial metal-cutting companies and, of course, the manufacturing industry at large. According to a recent article from the U.S. News & World Report, it is estimated that more than half a million skilled manufacturing jobs remain unfilled due to the labor skills gap in the U.S., and that number will likely increase as more and more Americans age out of the workforce.

As we covered here, this has prompted industry leaders like GE and industry associations like the Society of Manufacturing Engineers (SME) to take action. Just last week, JPMorgan Chase & Company announced a $5-million commitment to the city of Dallas to help shrink the skills gap within several industries. The move is part of a five-year, $250-million national initiative Chase launched in December to provide job training and fund local research to identify the areas most in need. As this video explains, the banking giant is using real data to identify real needs and then investing in those needs to fill the actual gaps.

While these types of large-scale initiatives might be left to large-scale companies, Chase’s strategy is one that just about any fabricator can apply to their own operations. Like Chase, fabricators that want to make a real difference in their business need to identify the actual gaps within their own company walls. This is especially true if a large number of your workers are headed for retirement. Once you have identified the gaps within your organization, you can determine the skills that are needed and then adjust your training and hiring programs accordingly.

The following are two strategies that can help you determine if (and where) there are skills gaps in your operation:

As the skills gap is proving, investing in your human capital is just as critical as investing in your technology and equipment. Taking the time to identify strengths and weaknesses within your operations staff—and then encouraging and rewarding improvement—is one way industrial metal-cutting leaders can equip themselves for today, as well as the future.

skills gap

How Machine Shops Can Make the Cut in 2014

April 20, 2014 / , , , , , , , , ,

Here’s the good news: Data continues to show that 2014 will likely be a year of growth. Gardner’s most recent metalworking business index (MBI), for example, showed that conditions in the metalworking industry expanded in March for the third straight month and the fourth time in five months. According to Modern Machine Shop, this was the fastest rate of growth since March 2012. Additional MBI findings revealed positive trends in several key business areas, including new orders and production, capacity utilization and spending, employment, and supplier deliveries. You can read the full report here.

All of this good news, however, comes with some uncertainty. As reported in LENOX Institute of Technology’s (LIT) 2014 outlook, most metals executives are only cautiously optimistic about the near-term future. Political issues, pricing pressures, and talent shortages are issues weighing heavily on industrial metal-cutting companies, leaving executives with no choice but to focus on continuous improvement as they attempt to strategically approach a shaky marketplace.

For machine shops, taking the time to make improvements is a challenge in itself, especially if business is starting to pick up. However, leading-edge shops know that in today’s demanding market, optimization is the only way to stay competitive. In other words, they are making time.

While you may not have the resources to undergo a major improvement initiative in 2014, the following are two key trends today’s machine shops need to consider:

To read more about trends we expect to see in 2014, check out LIT’s 2014 Industrial Metal-Cutting Outlook.

skills gap

Key Trends for Metal Service Centers in 2014

April 5, 2014 / , , , , , , , , , ,

As the industry heads into the second quarter, uncertainty remains. In fact, as we state in our 2014 Industrial Metal-Cutting Outlook, uncertainty may be the only thing that is certain right now.

Like most sectors of the metal-cutting industry, metal service centers have experienced little if any growth in 2014. January started off with a much-needed improvement over December, with small increases in shipments and reduced inventory levels. However, February wasn’t as strong as many had hoped. According to the latest figures from the Metal Service Center Institute, U.S. service center steel shipments in February 2014 increased by 0.4% from February 2013, and 2014 year-to-date steel shipments increased by 0.2% from the same period in 2013. When looking at total volume from January to February, service centers’ shipments of steel and aluminum actually declined, reports IndustryWeek.

In other words, we aren’t quite there yet. Experts like the Manufacturers Alliance for Productivity and Innovation (MAPI) are hopeful that the rebound is coming, but until then, there are several industry trends that we feel will be key for metal service centers in 2014. Here are a few to keep in mind:

skills gap

How Metals Companies Can Manage the Skills Gap

February 15, 2014 / , ,

At this point, most industrial metal-cutting executives are aware that the manufacturing industry is facing a tremendous workforce challenge. A widening skills gap is threatening U.S. businesses at large, and, according to Forbes, even the best firms are feeling the effects.

For manufacturers, the issue is two-fold. First, skilled production workers are one of the largest workforce segments facing retirement in the near future, which will have an impact on the number of experienced workers on the shop floor. In fact, recent reports say the mass “boomer exodus” has already begun.

Meanwhile, the current talent pool isn’t what is should be. Streamlined production lines and more process automation have changed the nature of manufacturing work, and the incoming generation of workers lacks the skills and technical knowledge required. What’s worse is that most young workers aren’t interested in working anywhere near a production line.

All of this is especially disheartening at a time when many companies are trying to bring manufacturing back to the United States. Industry associations like the Society of Manufacturing Engineers and major players like GE are attempting to get ahead of the problem by working closely with universities and government bodies to provide the necessary training and education to encourage students to pursue careers in manufacturing. And while these types of initiatives are certainly encouraging—and necessary—what can manufacturers do right now to help close the skills gap within their own operations?

For many companies, managing the skills gap will require changing the way they train and maintain talent, whether that means beefing up training programs or rethinking their employment strategies. This will mean different things for different companies, but here are a few of the talent strategies being used by some forward-thinking manufacturers:

The skills gap is a daunting issue for sure, and there is no “silver bullet” solution. However, manufacturers that fail to tackle this challenge now will find themselves facing bigger problems in the future. The next generation of manufacturing may offer a new set of talent challenges, but as proactive companies are finding, it also presents a new set of opportunities.

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