The business dynamics and the skills that are required to succeed were not present a mere decade ago. It’s a certainty that today’s tenured business leaders are challenged with the rate of change to their establishments and developing the next generation of leaders.
2. all with an acute awareness of their role in
the world at large. They will demand that
companiessharethesesamevalues.
Given that they are always connected,
they are comfortable with work-life in-
tegration, and are pre-dispositioned to
continuous learning and adoption of new
technology. Psychologically, this group of
the workforce is supremely equipped for the
dynamic, always changing business climate.
Through the prism of the digital glass, they
are eager to re-invent the world and chal-
lengeoldparadigmswiththenextbigidea.
While millennials may be mentally
equipped to reinvent their world, they are
also lacking in some key areas that are des-
peratelyneededinmanufacturing.Approxi-
mately 2.4 million manufacturing jobs may
go unfilled by 2028, reducing production
output by an estimated $454 billion in the
U.S., according to Deloitte. This is not so
much the result of an inadequate workforce
size, but more accurately the result of the
lack of workforce skill and will. Millenni-
als consistently rank manufacturing as the
industry for which they are least interested
in working. Raised in a world of high-tech
intrigue, a ubiquitous college degree, and a
mutually exclusive notion of environmental
awareness vs. industry, they are very unlike
the exiting boomers. There has been a major
cultural shift in the desirability of working
for a company that manufactures vs. other
business sectors such as services, finance,
andhightech.
Manufacturing executives, survey by
Deloitte, indicate that 60% of current open
positions are unfilled due to lack of skilled
workers. With the trend line of qualified
candidates going down, this represents a
major threat to a manufacturer’s long-term
success. In the coming decade, U.S. manu-
facturing will need to fill about 3.4 million
jobs. This is comprised of 2.7 million pro-
jected retirements and an increased demand
of 700,000 for a growing economy. These
labor statistics foreshadow business con-
straints to come that will profoundly affect
manufacturing operations. With such a
huge workforce requirement, it is likely that
the industry is going to face difficulties in
findingqualifiedtalent.
The technological evolution of manufac-
turing has also created a skills gap in these
projected jobs, further exacerbating the
workforce challenge. The skill set required
for the coming age will an add-on to re-
quired traditional skills. Repetitive motion
and assembly line tasks are being dimin-
ished by automation with employee duties
shifting to tasks that are more custodial.
These new jobs will require workers clos-
est to the material conversion processes to
think more in terms of the bigger picture.
While still in a shop floor environment, la-
bor must be able to apply critical thinking in
areas of mechanical troubleshooting, ma-
chine programming, and production opti-
mization.
The new manufacturing jobs will require
a high level of training and/or experience,
but the most experienced workers are retir-
AnInflectionPoint
fortheU.S.Workforce
I
t’s official. Having been born after
1980, millennials are now the largest
group in the labor force according to
the U.S. Census Bureau. Recently pushing
out Generation X as the workforce major-
ity, the U.S. fountain of youth continues
to spring as baby boomers retire. And the
incoming contingent is very different from
the outgoing. Baby boomers ushered tech-
nology into business, fought through the
energy crisis, and navigated global expan-
sion. Their millennial children think a tech
bubble is a fun party favor, a phone book is
an environmental crime, and everything is
funneledthroughthesmartphone.
Gen X’ers have a median age of 46 and
are inheriting the reigns of leadership po-
sitions. As a group, they have experiences
on both sides of the digital divide. Partici-
pating in the last industrial revolution, the
computerization of business, this part of
the workforce has become very adept at re-
engineering business processes and making
continuous improvements to existing para-
digms by applying new technologies and
techniques. Now they are filling key lead-
ership roles and managing the industry 4.0
revolution. Where the baby boomers were
“all in” on company loyalty and the “work-
to-live”attitude, the Gen X’ers are the opti-
mizers.Theystrivetooptimizecareer,work-
life balance, and previously established
businesspractices.
Acting as the analog to digital converter,
Gen X is the bridge from the baby boom-
ers to the millennials. But the brand new
workforce only operates digitally. Raised
on smart phones and social networks, they
have little understanding or patience for an
unconnected, unautomated business world.
The older generations may find some naive-
té in this youthful disposition, but the future
is digital and success belongs to those that
cancontinuetoleadmanufacturingthrough
thisdigitaltransformation.
Millennials will comprise more than one
in three adult Americans by 2020 and 75
percent of the workforce by 2025, according
to The Brookings Institution. This kind of
workforce turnover will profoundly change
manufacturing in ways that migrate toward
the characteristics of the group. Many mil-
lennials, experiencing screen time before
they could read, have developed an “always
connected”wayof life.Thisabstractandex-
tended socialization beyond their physical
spaces causes them to deeply care about the
environment,valuediversityandteamwork,
ANUFACTURING IN THE DIGITAL AGE HAS CHANGED.
The business dynamics and the skills that are required to succeed were
notpresentameredecadeago.It’sacertaintythattoday’stenuredbusi-
ness leaders are challenged with the rate of change to their establish-
ments and developing the next generation of leaders. The new leaders
willhavedifferentbackgrounds,workdifferently,andmusthaveadditionalskillstosucceed.
MANUFACTURING
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M
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“Leadership skills in managing
vendors and partnerships to
augment staffing and capabilities
will be more critical than ever.”
CI
NextGenerationLeadership
Feature/ Multigenerational Leadership 4/7
ScottRenneris
GlobalDirec-
torofIndustrial
Manufacturing
atOracleandhas
helpedguidein-
dustrialmanufac-
turingcompanies
throughmajor
operationaland
managementsys-
temtransforma-
tionsformorethan
twodecades.Afor-
merindependent
manufacturing
andsupplychain
consultant,Renner
holdsadegreein
managementin-
formationsystems
fromtheUniversity
ofCincinnati,and
anM.B.A.from
XavierUniversity.
3. ing at a rate of 10,000 per day.
While books have been writ-
ten about the business and
social impact of the retiring
boomers, this labor dynamic
has created a workforce and a
leadershipgap.Thisleadership
gap comes at a time of great
challenge in the manufactur-
ing world, as business is more
challenging than it has been in
decades. The leadership chal-
lenges for the next generation
requires deep industry experi-
ence and a steady hand, com-
bined with a new way of think-
ing about products, services,
and even society at large. The
future manufacturing work-
force will require deep techni-
cal skills, and the digital generation is show-
inglittleinterest.
The three mega factors to manufactur-
ing success in the coming decade are digital
transformation, globalization, and talent
management. This triad of challenges is in-
terconnected, enabled and constrained by
each other. The next generation of leaders
must have the ability to recognize and man-
agethesethreatsandopportunities.
AttheDawnofDigital
Transformation
D
igital transformation in manu-
facturing has only just begun.
The foundational elements
of cloud computing, big data, IoT, and
5G are not digital transformation alone,
but only the infrastructure to enable data
communication. The frontier for the next
generation of leaders is to harness this
data for competitive advantage. This re-
quires a new leadership skill set, one that
can break out of the discrete systems of
established business operations from
prior generations. This requires both the
technical know-how to understand the
interconnectedness of a larger ecosys-
tem, and perhaps more importantly the
creativity to “see” channels for growing
business - through new market opportu-
nities, optimization for extended supply
chains, and ability to build and deploy in-
telligenceintobusinessoperations.
In this converged model, technology be-
comes a much more important enabler to
business. The future leaders must be equal-
ly converged. A hybrid skill set combining
business and technology expertise becomes
mandatory as the physicality of products
and operations are intertwined with tech-
nology. Technology managers must become
morebusinesssavvy,andbusinessmanagers
mustbecomemoretechnologysavvy.
The baby boomers gave us enterprise
computing, and the Gen X’ers continually
optimized the computer state with iterative
precision. The next generation promises
the next revolution. Managing the transi-
tion to hyper-automation with artificial
intelligence and machine-to-machine com-
munication will be a tremendous challenge.
Replete with technical and social issues ri-
valing the Manhattan project, this revolu-
tion must be managed with both technical
competenceandsocietaltact.
TheNewRulesofGlobal
G
lobalization has traditionally
been characterized by massive
import/exportandinvestmentin
foreign assets. There has always been a “re-
moteness” about globalization that only
involved the trade of goods from faraway
lands. The coming of business digitaliza-
tionamplifiestheopportunitiesof broader
markets. As products and process become
more digitalized and the interoperability
of business operations rise, competitors
and partners will pop up anywhere. The
next generation of leadership must master
the potential of global ideas, the manage-
ment and protection of intellectual prop-
erty, the collaboration of more business
partners, and the extreme localization of
manufacturing that will be enabled by ad-
vancedtechnologies.
Whilethebabyboomersopenednewmar-
kets and established low-cost manufactur-
ing solutions, the next generation of leaders
will blow this model up, bypassing supply
chain rigidity and lead times for oversea
shipments. Instead, they will lead their in-
dustriesinAR,VRandanyvariantof trans-
location, teleportation, etc. They will lead
their industries in decentralized manufac-
turingbyutilizingcontractpartnersormini-
factories and digital material conversion
processes like additive manufacturing. The
playingfieldexpandsforthenextgeneration
and success favors those that can leverage
the world as a resource to fill demand simul-
taneously,nearandfar.
Talent–TheMostImportantAsset
M
anaging the talent needs of
manufacturing in the com-
ing decade may be the most
important dynamic. Arguably, it’s never
been a more exciting time to be in manu-
facturing. Every aspect of manufacturing
has become more technical. The digitiza-
tion of products, automation of process,
and the extension of supply chain man-
agement adds complexity that requires
moreemployeeknowledge,skill,andlarg-
er domain influence. The higher demands
of business will require a workforce with
highercapabilities.
In the face of a workforce shortage and
the heightened demands of business, au-
tomation of manufacturing is an obvious
response. The dearth of labor is the gaso-
line on the already raging fire of automa-
MANUFACTURING
LEADERSHIP JOURNAL
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“The leader-
ship chal-
lenges for the
next genera-
tion requires
deep industry
experience
and a steady
hand, com-
bined with
a new way
of thinking
about prod-
ucts, services,
and even soci-
ety at large.”
6
www.ml-council.com
“The next generation of leaders must be
able to combine the internal operational
excellence of the past with an external
focus on technological development and
new market opportunities.”
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CI
NextGenerationLeadership
Feature/ Multigenerational Leadership 6/7
4. tion, thereby driving businesses into even
more production investment. However, this
defines the proverbial Catch-22. How does
a manufacturer streamline and automate to
become more effective in the face of labor
constraints, and also acquire more skill sets
and staffing to support the complexities of
automation? Even the largest of manufac-
turers can’t reasonably expect to master ev-
ery technology that will contribute to their
transformation. Leadership skills in man-
aging vendors and partnerships to augment
staffing and capabilities will be more critical
than ever.
This nuisance between managing part-
nerships from the last generation to the
new is important. Heretofore, partnerships
largely were formed based on a build vs. buy
mentality. But labor shortages and the as-
sured rarity of certain skill sets will remove
that luxury for future managers. The ability
to build will simply not be realistic, thereby
creating the need for a higher level of stra-
tegic relationships with business partners.
This, of course, implies that leaders must
have the skills to form and manage a net-
work of disparate business partners that
contribute horizontally and vertically to
their industries.
Technology is rapidly changing business
models and traditional operations, and it
will continue to do so. While the trajectory
of business is quite obvious, the future details
of any singular environment are not particu-
larly predictable. Stagnant business models
that have life spans measured in decades are
no longer safe. This moving target means
that future leaders must create businesses
that are agile. The next generation of lead-
ers must promote and manage a state of con-
stant innovation. This means that they must
be able to foster a digital culture where every
employee becomes a sentry for new ideas and
improvements to product and process. Cor-
respondingly, your competitors are doing the
same. So, in this opportunistic dystopia, the
next generation of leaders must be quick to
react to market threats. The next generation
of leaders must be able to combine the inter-
nal operational excellence of the past with
an external focus on technological develop-
ment and new market opportunities. They
must develop an organization that evaluates
new technologies quickly, adopts new busi-
ness models quickly, incubates winners and
eschewslosers.
Required:Leaders
WhoRisetotheChallenge
M
anufacturing is changing at the
same time that the workforce
is changing, creating a perfect
storm for the next generation of leaders. The
combined assets from the entire workforce
will be required to thrive. The next genera-
tion of leaders will need to manifest the ex-
perience of the exiting boomers, the opera-
tional excellence from Generation X, and the
digitalinnovationfromthemillennials. M
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“AI is already proving to be a valu-
able tool in making predictions and
uncovering hidden insights from
which humans can then act upon.”
CI
ArtificialIntelligenceinManufacturing
Feature/ Empowering the Factory Floor With AI /
