By: Pradeep Amladi, Vice President, SAP
May 19, 2016
In what it is calling the “Mine of the Future,” leading global miner Rio Tinto, is using automation to cut costs, improve safety, and reduce environmental impact.
The company has 69 fully automated driverless trucks operating in Western Australia, an automated drilling system at its West Angelas mine, and is working on the world’s first fully-autonomous heavy haul railway system. While the company says its seen a 14 percent increase in efficiency and a 13 percent decrease in cost from the shift to autonomous vehicles, it has also been reported that 38,000 mining jobs were lost in Australia between May 2012 and December 2014 (Financial Times, 2015). While lower-skilled positions are becoming obsolete, there is a growth in new roles that involve analyzing data and developing new technology solutions.
As the above, real-world example illustrates, the new digital economy is forcing companies to re-imagine who they are, what they sell and even how they operate. In this era of fast-paced business innovation, the world is getting smarter and more connected. But, along with this data-driven environment comes change and complexity, especially in the workforce. The “knowledge worker” is being transformed into the “digital worker” as companies strive to extract value and meaning from the incredible amount of newly available information. As technology continues to improve the speed at which data can be collected, analyzed and shared, companies and their employees will need to adapt faster than ever before.
Complexity can be the enemy of workforce management. People are working harder but, without access to the right technology, end up accomplishing less. In fact, organization complexity can drive up costs while actually slowing down progress. The primary forces driving change within today’s workforce include:
photo credit: Business Insider
Changing Workforce Demographics. According to PWC, by 2020 more than 50 percent of the workforce will be millennials. Not only will the majority of workers be younger, but their motivations, needs and skills also will be different. For example, 62 percent of millennials want to work for a company that makes a positive impact in the world (Global Tolerance, 2015). And yet, few companies give special attention to the particular wants and needs of millennials. Making industrial work attractive for this digital generation, while capitalizing on their particular skill sets, will be critical to the ongoing success of the industry.
Rise of Contingent Work. As customer requirements become more complex, organizations need the ability to quickly deploy talent outside their internal workforce. More and more companies are turning to contractors and services providers to add agility and lower fixed costs. Over the next five years, the number of independent workers in America is expected to grow by 25.4 percent to 37.9 million, comprising an estimated 30 percent of the private, non-farm workforce (State of Independence in America, 2015).
Constant Re-organization. Constantly re-organizing operations and corresponding workforce plans in accordance with data-driven changes is a reality for today’s manufacturers. Yet these ongoing adjustments cannot disrupt operations. All human resources systems should be integrated in order to maintain accurate data on all employees – whether they are internal or contingent – such as certifications, contracts, location, etc.
Increase in Regulations. Regulation compliance is a challenge when managing a growing, global workforce. Country regulations seem to change daily, making it difficult to ensure all safety and labor laws, visas and benefits stay in compliance with individual country laws. Without an integrated human capital management system, regulation issues can hinder an organization’s ability to quickly respond to market demand.
Five Workforce Management Strategies
Organizations in every industry must figure out how to attract the digital generation, while also supporting the company’s need for quickly delivering innovative products and services to the market. Below are five strategies for talent management in the digital age:
Change the Job. With nearly every asset now equipped with sensors that continually transmit data, job requirements are changing fast. Knowing how to access, analyze and use data to determine action and decisions is key. Consequently, job parameters are changing as well. For example, farmers now must be able to look at data from smart farming equipment, drones, satellites, partners and more to determine where and when to plant seed. Also, traditional assembly line workers are becoming orchestrators and exception managers.
Change the Work. In some areas, such as back-office processes, technology innovations are eliminating work that used to be performed manually. Procurement, inventory management, invoicing and payment processing are handled using real-time analytics and rule-based decision making. Drones are being used to inspect assets in remote locations; and some companies, like Rio Tinto, are developing completely unmanned operations featuring autonomous truck fleets and automated drilling systems.
Change the Access. To be effective, the next generation of workers must be able to access the right information when and where they need it. Access to real-time information arms employees with the data needed to solve problems quickly. This information also needs to be accessible from any location. With an increasingly global and remote workforce, workers need to access enterprise data and execute transactions from anywhere in the world.
Change the Interaction. Employees don’t want to read manuals or attend lengthy training sessions to learn how to use new systems or repair equipment. Instead, they want to interact with a company’s technology in the same way they use it in their personal lives. For deployed technology to be adopted by future generations of workers, it should include an easy-to-use interface featuring technology such as voice recognition, 3D graphics, visualization and/or gaming.
Change the Collaboration. In the past, team collaboration typically took place by assembling everyone in a conference room. Today, collaboration is more ad hoc with participants in different locations. Companies need tools that bring together the right people for the job independent of boundaries and help them share resources.
To compete in the digital economy, manufactures need to invest in digital capabilities that are congruent with their strategy and support workforce initiatives. The right workforce management system can create a rich environment for innovation by empowering workers to make decisions in the context of overall operations and industry trends. It’s time to invest in the future workforce, today.