Now more than ever, manufacturers need to ensure that their workforce is as productive as possible. Constraints on available labor resources, fluctuating production demands, and unplanned absenteeism are driving manufacturers to develop flexible operational practices that maximize resources while implementing processes and policies that support agility in the current challenging business environment.
With that, manufacturers know that continuing their digital transformation strategies is crucial to remaining competitive now and in the future. Implementing new technologies that provide the workforce timely access to the right information is now an urgency rather than a luxury.
Employees need real-time data to fuel informed decision making to navigate today’s volatile conditions, and manufacturers need to drive collaboration between processes and people to support that.
Why Now? Accelerating Performance Management and Reducing Costs is Critical
Digital transformation enables manufacturers to experience dramatic workforce performance improvements and cost reduction, and increased employee engagement. A survey of Fortune 1000 executives found that one of the most valuable transformation initiatives was decreasing expenses by implementing data-driven decision making to processes – 49% of those surveyed saw value in the projects it was applied to. 1
Additionally, the current state of business operations has made cost saving efforts and profit-making opportunities harder to find. Labor is virtually every manufacturer’s biggest controllable cost, and at the same time the largest value creation mechanism. Investments in digital initiatives tied to labor, like labor analytics, need to be prioritized.
Access to Information Drives Workforce Performance
While technology is the foundation of digital transformation, people are the driving force. It is the intersection of the workforce with technology that will foster a more powerful future of work.
To realize the full value of transformation, manufacturers must not only have access to the right real-time data, they must also provide that data to their workforce. Creating a connected business empowers the workforce to make informed decisions while building a culture of trust that will also help in the battle to attract skilled talent.
How can Manufacturers Shift Their Practices to Realize This Value?
1. Define & Drive Strategies Via Better Decision-Making
The workforce is traditionally starved of useful information and not given any context or insight into how their work impacts larger initiatives. Use of latent data often results in disjointed workflows, limiting the ability of employees to make informed decisions. In this state, manufacturers cannot increase the operational agility needed to support rapid shifts in consumer demand.
Leaders can counteract this in two ways; first by connecting the workforce with real-time data needed to support strategic decision making by using the technology and analytical tools needed to provide insight into the data available. Second, by encouraging an all-inclusive look at the data available to ensure it supports goals effectively.
2. Empower Employees to Maintain Top Talent and Reinforce Organizational Culture
Now is the time to transition employee empowerment from buzzword to actionable reality. Why? Employees that are empowered on the job are a major component of a strong corporate culture, which is critical to retaining top talent. Per Gallup, strong cultures drive employee engagement, and organizations in the top 25% of engagement have employees that are 87% less likely to leave, experience 22% greater productivity, and are 21% more profitable. 2
What can organizations do to foster a strong culture?
Provide employees with access to the information needed to execute their jobs successfully, empowering them with ownership over their performance.
3. Support Employee Experience through Innovative Workforce Management Strategies and Technologies
Many manufacturers are using the same shift schedules, labor strategies, and information tools in their hourly operations that they used fifty years ago. Why is this a problem?
93% of millennials cite modern and up-to-date technology as one of the most important aspects of the workplace. 3 Consumer-grade technology that connects and informs employees empowers them with the freedom needed to work their way and helping to build the foundation of a strong culture. This includes workforce management tools that allow employees to access instant pay, streamline their work communications, allow for their voices to be heard through surveys, and easily view their schedules or swap shifts when needed.
Successful Digital Transformation Requires Practices that Fuel an Empowered Workforce
The most successful digital transformation strategies are implemented with a holistic view of the organization. A thorough understanding of how access to the right data, employee adoption of new technologies, and effective people practices work together is essential to drive the highest value from transformation.
Practices that Fuel an Empowered Workforce
Although it always felt good to say: “we care about employees,” following through to compete in today’s landscape is now a necessity. This means changing operating models and workforce strategies. Consider six key practices:
1. Create and articulate clear goals. Communicate how your goals are linked to the organization’s future vision. As a leader, it is important for you to connect the work to your company’s overarching strategy and your employees’ day-to-day efforts.
2. Align around the strategy. To achieve organizational goals, a clear strategy with alignment and buy in from the workforce is needed. Strategy requires trade-offs and the goals you are focused on now will require a reassessment and redeployment of resources. Clearly articulating urgency and purpose can help drive continued alignment over time.
3. Create an environment of transparency and trust. Using exaggerated language about a great culture and a management team will be weaponized by employees who have experienced a different reality. They will take to social media, including Glassdoor, Indeed, and LinkedIn to share their experiences. These reviews can be damaging as Gen Z and Millennial workers research potential jobs through these sites.
4. Provide employees access to relevant information. Management teams often deprive employees of useful information while simultaneously providing them with untenable, unusable data. This dichotomy creates paralysis, and companies continue to operate under the status quo rather than implementing change head on.
5. Give employees decision rights and connect their work to organizational strategies. The Ankura cultural diagnostic tool, Diialog™, which helps companies identify opportunities for cultural improvements, includes the question, “Are decisions made higher up than they need to be?” Why? Because the answer to this question is a key indicator of culture. Without decision rights, employees are often left to feel helpless, without impact, and frustrated. Help employees make the right decisions by linking the work they do to the organization’s strategy and goals to support better, more agile decision making and effective execution.
6. Let employees work their way. Flexible work practices, such as creative time off strategies and shift schedules, can drive employee empowerment by allowing them to work their way. For example, the 8-hour shift is slowing dying as employee preferences move to longer shifts to acquire more days off. Organizations need to adjust their practices to meet these changing expectations.
The Time to Transform is Now
In today’s environment, manufacturers must change. True transformation requires examining all inputs, processes, and stakeholders to drive success in the face of complexity. Prioritizing the implementation of labor-focused technologies will help amplify the value driven from digital transformation.
This blog was adapted from a white paper written in collaboration with John Frehse and Zach Warrick at Ankura Consulting. For more detailed information on how access to information can drive performance improvements in the workforce, as well as where your organization falls on the digital maturity matrix, the full whitepaper is available for download here: Improving Workforce Performance Through Digital Transformation.
1. “If You Want Your Digital Transformation to Succeed, Align Your Operating Model to Your Strategy,” Harvard Business Review, 1/31/2020.
2 “How Companies Say They’re Using Big Data,” Harvard Business Review, 4/28/2017.
3 “How Employee Engagement Drives Growth,” Gallup, 6/20/2013